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Full text of "Report of the congressional committees investigating the Iran- Contra Affair : with supplemental, minority, and additional views"

Y l.l/2:Serial 13751 

United States Congressional.., 



Government 
Documents 






%. AUG 7 1550 



' BC- 




100th Congress — 1st Session • January 6-December 22, 1987 



Senate Report 

No. 216 




IRAN-CONTRA INVESTIGATION 

APPENDIX B, VOLUME 10 
DEPOSITIONS 



United States Congressional Serial Set 

Serial Number 13751 



United States Government Printing Office 
Washington : 1989 



Union Calendar No. 277 
100th Congress, 1st Session 
S. Rept. No. 100-216 H. Rept. No. 100-433 



Report of the Congressional Committees Investigating the 

Iran-Contra Affair 

Appendix B: Volume 10 
Depositions 



Daniel K. Inouye, Chairman, 
Senate Select Committee 

Lee H. Hamilton, Chairman, 
House Select Committee 



U.S. Senate Select Committee U.S. House of Representatives 

On Secret Military Assistance to Iran Select Committee to Investigate 

And the Nicaraguan Opposition Covert Arms Transactions with Iran 

November 13, 1987. - Committed to the Committee of the Whole House 

on the State of the Union and ordered to be printed. 

November 17, 1987. -Ordered to be printed. 

Washington : 1988 



Bnited ^tatCB 3tnate 

SELECT COMMITTEE ON SECRET MILITARY 

ASSISTANCE TO IRAN AND THE NICARAGUAN OPPOSITION 

WASHINGTON. DC 20510-6480 



March 1, 1988 

Honorable John C. Stennis 
President pro tempore 
United States Senate 
Washington, D.C. 

Dear Mr. President: 

We have the pleasure to transmit herewith, pursuant to 
Senate Resolution 23, Appendix B to the final Report of the 
Senate Select Committee on Secret Military Assistance to Iran 
and the Nicaraguan Opposition. We will submit such other volumes 
of Appendices to the Report as are authorized and as they become 
available. 



Sincerely, 




Warren B. Rudman 
Vice Chairman 




III 



U.S. HOUSE OF REPRESENTATIVES 

SELECT COMMITTEE TO INVESTIGATE 

COVERT ARMS TRANSACTIONS WITH IRAN 

UNITED STATES CAPITOL 

WASHINGTON. DC 206 IB 

(202) 225-7902 

March 1, 1988 



The Honorable Jim Wright 
Speaker of the House 
U. S. Capitol 
Washington, D. C. 20515 

Dear Mr. Speaker: 

Pursuant to the provisions of House Resolutions 12 and 
330 and House Concurrent Resolution 195, 100th Congress, 1st 
Session, I transmit herewith Appendix B to the Report of the 
Congressional Committees Investigating the Iran-Contra A ffair, 
House Report No. 100-433, 100th Congress, 1st Session. 

Appendix B consists of the depositions taken by the 
Select Committees during the investigation. The contents of 
Appendix B have been declassified fop-^xelease to the public. 

enely yours. 




Lee H. Hamilton 
Chairman 



United States Senate 

Select Committee on Secret Military Assistance 
To Iran and the Nicaraguan Opposition 

Daniel K. Inouye, Hawaii, Chairman 
Warren Rudman, New Hampshire, Vice Chairman 

George J. Mitchell, Maine 

Sam Nunn, Georgia 
Paul S. Sarbanes, Maryland 
Howell T. Heflin, Alabama 
David L. Boren, Oklahoma 

James A. McClure, Idaho 

Orrin G. Hatch, Utah 

William S. Cohen, Maine 

Paul S. Trible, Jr., Virginia 



Arthur L. Liman 
Chief Counsel 

Mark A. Belnick Paul Barbadoro 

Executive Assistant Deputy Chief Counsel 

To the Chief Counsel 

Mary Jane Checchi 
Executive Director 

Lance I. Morgan 
Press Officer 



VI 



United States House of Representatives 

Select Committee to Investigate Covert Arms 
Transactions witli Iran 

Lee H. Hamilton, Indiana, Chairman 
Dante B. Fasceil, Florida, Vice Chairman 

Thomas S. Foley, Washington 

Peter W. Rodino, Jr., New Jersey 

Jack Brooks, Texas 

Louis Stokes, Ohio 

Les Aspin, Wisconsin 

Edward P. Boland, Massachusetts 

Ed Jenkins, Georgia 

Dick Cheney, Wyoming, Ranking Republican 

Wm. S. Broomfield, Michigan 

Henry J. Hyde, Illinois 

Jim Courier, New Jersey 

Bill McCollum, Florida 

Michael DeWine, Ohio 



John W. Nields, Jr. 
Chief Counsel 

W. Neil Eggleston 
Deputy Chief Counsel 

Kevin C. Miller 
Staff Director 



Thomas R. Smeeton 
Minority Staff Director 

George W. Van Cleve 
Chief Minority Counsel 

Richard J. Leon 
Deputy Chief Minority Counsel 



VII 



United States Senate 



Select Committee on Secret Military Assistance to 
Iran and the Nicaraguan Opposition 



Arthur L. Liman 
Chief Counsel 
Mark A. Belnick Paul Barbadoro 

Executive Assistant Deputy Chief Counsel 

to the Chief Counsel 

Mary Jane Checchi 
Executive Director 

Lance I. Morgan 
Press Officer 

Associate Counsels 



C. H. Albright, Jr. 
Daniel Finn 
C. H. Holmes 
James E. Kaplan 
Charles M. Kerr 
Joel P. Lisker 



W. T. McGough, Jr. 
Richard D. Parry 
John D. Saxon 
Terry A. Smiljanich 
Timothy C. Woodcock 



Committee Staff 



Assistant Counsels 



Legal Counsel 
Intelligence/Foreign 

Policy Analysts 
Investigators 



Press Assistant 
General Accounting 
Office Detailees 



Security Officer 
Security Assistants 



Chief Clerk 
Deputy Chief Clerk 



Steven D. Arkin* 
Isabel K. McGinty 
John R. Monsky 
Victoria F. Nourse 
Philip Bobbitt 
Rand H. Fishbein 
Thomas Polgar 
Lawrence R. 

Embrey, Sr. 
David E. Faulkner 
Henry J. Flynn 
Samuel Hirsch 
John J. Cronin 
Olga E. Johnson 
John C. Martin 
Melinda Suddes* 
Robert Wagner 
Louis H. Zanardi 
Benjamin C. 

Marshall 
Georgiana 

Badovinac 
David Carty 
Kim Lasater 
Scott R. Thompson 
Judith M. Keating* 
Scott R. Ferguson 



Staff Assistants 



Administrative Staff 



Secretaries 



Receptionist 
Computer Center 
Detailee 



John K. Appleby 
Ruth Balin 
Robert E. Esler 
Ken Foster* 
Martin H. Garvey 
Rachel D. Kaganoff* 
Craig L. Keller 
Hawley K. 

Manwarring 
Stephen G. Miller 
Jennie L. Pickford* 
Michael A. Ray nor 
Joseph D. 

Smallwood* 
Kristin K. Trenholm 
Thomas E. Tremble 
Bruce Vaughn 
Laura J. Ison 
Hilary Phillips 
Winifred A. Williams* 
Nancy S. Durflinger 
Shari D. Jenifer 
Kathryn A. Momot 
Cindy Pearson 
Debra S. Sheffield* 
Ramona H. Green 
Preston Sweet 



VIII 



Committee Members' Designated Liaison 



Senator Inouye 
Senator Rudman 

Senator Mitchell 

Senator Nunn 

Senator Sarbanes 
Senator Heflin 



Peter Simons 
William V. Cowan 
Thomas C. Polgar 
Richard H. 
Arenberg 
Eleanore Hill 
Jeffrey H. Smith 
Frederick Millhiser 
Thomas J. Young 



Senator Boren 

Senator McClure 
Senator Hatch 

Senator Cohen 

Senator Trible 



Sven Holmes 
Blythe Thomas 
Jack Gerard 
Dee V. Benson 
James G. Phillips 
James Dykstra 
L. Britt Snider 
Richard Cullen 



Part Time* 



Assistant Counsel 
Hearings Coordinator 
Staff Assistants 



Interns 



Peter V. Letsou 
Joan M. Ansheles 
Edward P. 

Flaherty, Jr. 
Barbara H. Hummell 
David G. Wiencek 
Nona Balaban 
Edward E. 

Eldridge, III 
Elizabeth J. Glennie 
Stephen A. Higginson 
Laura T. Kunian 
Julia F. Kogan 
Catherine L. Udell 



Document Analyst 

Historian 

Volunteers 



Lyndal L. Shaneyfelt 
Edward L. Keenan 
Lewis Liman 
Catherine Roe 
Susan Walsh 



*The staff member was not with the Select Committee when the Report was filed but had, during 
the life of the Committee, provided services. 



IX 



United States House of Representatives 



Select Committee to Investigate 
Covert Arms Transactions with Iran 

Majority Staff 



John W. Nields, Jr. 
Chief Counsel 

W. Neil Eggleston 
Deputy Chief Counsel 

Kevin C. Miller 
Staff Director 



Special Deputy 

Chief Counsel 
Staff Counsels 



Press Liaison 
Chief Clerk 
Assistant Clerk 
Research Director 
Research Assistants 



Charles Tiefer 

Kenneth M. Ballen 
Patrick J. Carome 
V. Thomas 

Fryman, Jr. 
Pamela J. 

Naughton 
Joseph P. Saba 
Robert J. Havel 
Ellen P. Rayner 
Debra M. Cabral 
Louis Fisher 
Christine C. 

Birmann 
Julius M. 

Genachowski 
Ruth D. Harvey 
James E. Rosenthal 



Systems 

Administrator 
Systetns 

Programmer/ 

Analysts 
Executive Assistant 
Stajf Assistants 



Catherine L. 

Zimmer 
Charles G. Ratcliff 
Stephen M. 

Rosenthal 
Elizabeth S. Wright 
Bonnie J. Brown 
Christina Kalbouss 
Sandra L. Koehler 
Jan L. Suter 
Katherine E. Urban 
Kristine Willie 
Mary K. Yount 



Minority Staff 



Thomas R. Smeeton 
Minority Staff Director 

George W. Van Cleve 
Chief Minority Counsel 

Richard J. Leon 
Deputy Chief Minority Counsel 



Associate Minority 

Counsel 
Assistant Minority 

Counsel 
Minority Research 

Director 



Robert W. 
Genzman 
Kenneth R. Buck 

Bruce E. Fein 



Minority Staff 
Editor/Writer 

Minority Executive 
Assistant 

Minority Staff 
Assistant 



Michael J. Malbin 

Molly W. Tully 

Margaret A. 
Dillenburg 



Committee Staff 



Investigators 



Director of Security 



Robert A. 

Bermingham 
James J. Black 
Thomas N. 

Ciehanskj 
William A. Davis, 

m 

Clark B. Hall 
Allan E. Hobron 
Roger L. Kreuzer 
Donald Remstein 
Jack W. Taylor 
Timothy E. Traylor 
Bobby E. Pope 



Security Officers 



Editor 

Deputy Editor 
Associate Editor 
Production Editor 
Hearing Editors 

Printing Clerk 



Rafael Luna, Jr. 
Theresa M. Martin 
Milagros Martinez 
Clayton C. Miller 
Angel R. Torres 
Joseph Foote 
Lisa L. Berger 
Nina Graybill 
Mary J. Scroggins 
David L. White 
Stephen G. Regan 
OR. Beckett 



Associate Staff 



Representative 
Hamilton 

Representative 
Fascell 

Representative 

Foley 
Representative 

Rodino 

Representative 

Brooks 
Representative 

Stokes 
Representative 

Aspin 



Michael H. 

Van Dusen 
Christopher Kojm 
R. Spencer Oliver 
Bert D. Hammond 
Victor Zangla 
Heather S. Foley 
Werner W. Brandt 
M. Elaine Mielke 
James J. 

Schweitzer 
William M. Jones 

Michael J. O'Neil 
Richard M. Giza 
Richard E. Clark 
Warren L. Nelson 



Representative 

Boland 
Representative 

Jenkins 
Representative 

Broomfield 
Representative 

Hyde 
Representative 

Courter 
Representative 

McCollum 
Representative 

DeWine 
General Counsel to 

the Clerk 



Michael W. Sheehy 

Robert H. Brink 

Steven K. Berry 
David S. Addington 
Diane S. Doman 

Dennis E. Teti 

Tina L. Westby 

Nicholas P. Wise 

Steven R. Ross 



XI 



Contents 

Volume 10 



Preface XXI 

Farber, Jacob 1 

Feldman, Jeffrey 29 

Fischer, David C 225 

Floor, Emanuel A 477 

Former CIA Officer 555 

Fraser, Donald 707 

Fraser, Edie 801 

Fuller, Craig L 903 



XIII 



Depositions 



Volume 1 



Airline Proprietary Project Officer. 
Alvarez, Francisco J. 
Allen, Charles. 
Arcos, Cresencio. 



Volume 2 



Volume 3 



Armitage, Richard. 
Artiano, Martin L. 
Associate DDO (CIA). 
Baker, James A., HI. 
Barbules, Lt. Gen. Peter. 
Bamett, Ana. 
Bartlett, Linda June. 
Bastian, James H. 
Brady, Nicholas F. 
Brown, Arthur E., Jr. 



Byrne, Phyllis M. 
Calero, Adolfo. 
Castillo, Tomas ("W"). 
Cave, George W. 
C/CATF. 



Volume 4 

Channell, Carl R. 

Chapman, John R. (With Billy Ray Reyer). 

Chatham, Benjamin P. 

CIA Air Branch Chief. 

CIA Air Branch Deputy Chief. 

CIA Air Branch Subordinate. 

CIA Chief. 

CIA Communicator. 

CIA Identity "A". 



XV 



Volume 5 

CIA Officer. 

Clagett, C. Thomas, Jr. 

Clark, Alfred (With Gregory Zink). 

Clarke. George. 

Clarridge, Dewey R. 

Cline, Ray S. 

C/NE. 

Cohen, Harold G. 

Volume 6 

Collier, George E. 

Cole, Gary. 

Communications Officer Headquarters, CIA. 

Conrad, Daniel L. 



Volume 7 



Cooper, Charles J. 
Coors, Joseph. 
Corbin, Joan. 
Corr, Edwin G. 
Coward, John C. 
Coy, Craig R 
Crawford, Iain T.R. 



Crawford, Susan. 
Crowe, Adm. William J. 
Currier, Kevin W. 
DCM, Country 15. 
DEA Agent 1. 
DEA Agent 2. 
DEA Agent 3. 
deGraffenreid, Kenneth, 
de la Torre, Hugo. 
Deputy Chief "DC". 



Duemling, Robert W. 
DIA Major. 
Dietel, J. Edwin. 
Dowling, Father Thomas. 
Dutton, Robert C. 
Earl, Robert. 



Volume 8 



Volume 9 



XVI 



Volume 10 



Farber, Jacob. 
Feldman, Jeffrey. 
Fischer, David C. 
Floor, Emanuel A. 
Former CIA Officer. 
Fraser, Donald. 
Fraser, Edie. 
Fuller, Craig L. 



Volume 11 



Furmark, Roy. 

Gadd, Richard. 

Gaffney, Henry. 

Gaffney, Henry (With Glenn A. Rudd). 

Galvin, Gen. John R. 

Gantt, Florence. 

Garwood, Ellen Clayton. 

Gast, Lt. Gen. Philip C. 

Gates, Robert M. 

Glanz, Anne. 



Volume 12 



George, Clair. 
Godard, Ronald D. 
Godson, Roy S. 
Golden, William. 
Gomez, Francis D. 
Goodman, Adam. 
Gorman, Paul F. 
Graham, Daniel O. 
Gregg, Donald P. 
Gregorie, Richard D. 
Guillen, Adriana. 



Hakim, Albert. 



Hall, Wilma. 
Hasenfiis, Eugene. 
Hirtle, Jonathan J. 
Hooper, Bruce. 



Volume 13 



Volume 14 



XVII 



Hunt, Nelson Bunker. 
Ikle, Fred C. 
Jensen, D. Lowell. 
Juchniewicz, Edward 
Kagan, Robert W. 
Keel, Alton G. 
Kellner, Leon B. 
Kelly, John H. 
Kiszynski, George. 



Koch, Noel C. 
Kuykendall, Dan H. 
Langton, William G. 
Lawn, John C. 
Leachman, Chris J., Jr. 
Ledeen, Michael A. 



Lei want, David O. 
Lilac, Robert H. 
Lincoln, Col. James B. 
Littledale, Krishna S. 
McDonald, John William. 
McFarlane, Robert C. 
McKay, Lt. Col. John C. 
McLaughlin, Jane E. 



McMahon, John N. 
McMahon, Stephen. 
McNeil, Frank. 
Makowka, Bernard. 
Marostica, Don. 
Marsh, John. 
Mason, Robert H. 



Meese, Edwin IIL 
Melton, Richard H. 
Merchant, Brian T. 
Meo, Philip H. 
Miller, Arthur J. 
Miller, Henry S. 
Miller, Johnathan. 



Volume 15 



Volume 16 



Volume 17 



Volume 18 



XVIII 



Miller, Richard R. 



Motley, Langhome A. 
Mulligan, David R 
Nagy, Alex G. 
Napier, Shirley A. 
Newington, Barbara. 
North, Oliver L. 
O'Boyle, William B. 
Osborne, Duncan. 
Owen, Robert W. 
Pena, Richard. 
Pickering, Thomas. 
Poindexter, John M. 



POsey, Thomas V. 
Powell, Gen. Colin L. 
Price, Charles H., n. 
Proprietary Manager. 
Proprietary Pilot. 
Radzimski, James R. 
Ramsey, John W. 
Ransom, David M. 



Volume 19 



Volume 20 



Volume 21 



Volume 22 



Raymond, Walter, Jr. 

Regan, Donald T. 

Reich, Otto J. 

Revell, Oliver B. 

Reyer, Billy Ray (See John Chapman). 

Reynolds, William B. 



Volume 23 



Richard, Mark M. 
Richardson, John, Jr. 
Robelo, Alfonso. 
Robinette, Glenn A. 
Rodriguez, Felix I. 
Roseman, David. 



XIX 



Rosenblatt, William. 

Royer, Larry. 

Rudd, Glenn A. 

Rudd, Glenn A. (See Henry Gaffney). 



Rugg, John J. 
Russo, Vincent M. 
Sanchez, Nestor. 
Scharf, Lawrence. 
Schweitzer, Robert L. 
Sciaroni, Bretton G. 
Secord, Richard V. 



Shackley, Theodore G. 
Sigur, Gaston J. 
Simpson, Major C. 
Sinclair, Thomas G. 
Singlaub, John K. 



Slease, Clyde H., IIL 
Smith, Clifton. 
Sofaer, Abraham D. 
Steele, Col. James J. 
Taft, WUliam H., IV. 
Tashiro, Jack T. 
Teicher, Howard. 
Thompson, Paul. 
Tillman^ Jacqueline. 



Volume 24 



Volume 25 



Volume 26 



Volume 27 



Thurman, Gen. Maxwell. 

Trott, Stephen S. 

Tull, James L. 

Vessey, John. 

Walker, William G. 

Watson, Samuel J., IIL 

Weinberger, Caspar. 

Weld, William. 

Wickham, John. 

Zink, Gregory (See Alfred Clark). 



XX 



Preface 



The House Select Committee to Investigate Covert Arms Transactions with Iran 
and the Senate Select Committee on Secret Military Assistance to Iran and the 
Nicaraguan Opposition, under authority contained in the resolutions establishing 
them (H. Res. 12 and S. Res. 23, respectively), deposed approximately 290 
individuals over the course of their 10-month joint investigation. 

The use of depositions enabled the Select Committees to take sworn responses 
to specific interrogatories, and thereby to obtain information under oath for the 
written record and develop lines of inquiry for the public hearings. 

Select Committees Members and staff counsel, including House minority 
counsel, determined who would be deposed, then sought subpoenas from the 
Chairmen of the Select Committees, when appropriate, to compel the individuals 
to appear in nonpublic sessions for questioning under oath. Many deponents 
received separate subpoenas ordering them to produce certain written documents. 

Members and staff traveled throughout the United States and abroad to meet 
with deponents. All depositions were stenographically reported or tape-recorded 
and later transcribed and duly authenticated. Deponents had the right to review 
their statements after transcription and to suggest factual and technical correc- 
tions to the Select Committees. 

At the depositions, deponents could assert their fifth amendment privilege 
to avoid self-incrimination by refusing to answer specific questions. They were 
also entitled to legal representation. Most Federal Government deponents were 
represented by lawyers from their agency; the majority of private individuals 
retained their own counsel. 

The Select Committees, after obtaining the requisite court orders, granted 
limited or "use" immunity to about 20 deponents. Such immunity means that, 
while a deposed individual could no longer invoke the fifth amendment to avoid 
answering a question, his or her compelled responses— or leads or collateral 
evidence based on those responses— could not be used in any subsequent criminal 
prosecution of that individual, except a prosecution for perjury, giving a false 
statement, or otherwise failing to comply with the court order. 

An executive branch Declassification Committee, located in the White House, 
assisted the Committee by reviewing each page of deposition transcript and some 
exhibits and identifying classified matter relating to national security. Some 
depositions were not reviewed or could not be declassified for security reasons. 

In addition, members of the House Select Committee staff corrected obvious 
typographical errors by hand and deleted personal and proprietary information 
not considered germane to the investigation. 

In these Depositions volumes, some of the deposition transcripts are follow- 
ed by exhibits. The exhibits - documentary evidence — were developed by Select 
Committees' staff in the course of the Select Committees' investigation or were 
provided by the deponent in response to a subpoena. In some cases, where the 
number of exhibits was very large, the House Select Committee staff chose for 
inclusion in the Depositions volumes selected documents. All of the original 



XXI 



exhibits are stored with the rest of the Select Committees' documents with the 
National Archives and Records Administration and are available for public in- 
spection subject to the respective rules of the House and Senate. 

The 27 volumes of the Depositions appendix, totalling more than 30,000 pages, 
consist of photocopies of declassified, hand-corrected typewritten transcripts 
and declassified exhibits. Deponents appear in alphabetical order. 



XXII 



Publications of the Senate and House 
Select Committees 



Report of the Congressional Committees Investigating the Iran-Contra Affair, 
1 volume, 1987. 

Appendix A: Source Documents, 2 volumes, 1988. 
Appendix B: Depositions, 27 volumes, 1988. 
Appendix C: Chronology of Events, 1 volume, 1988. 
Appendix D: Testimonial Chronology, 3 volumes, 1988. 

All publications of the Select Committees are available from the U.S. 
Government Printing Office. 



XXIII 



.1 



>eposition of Jacob Farber 



\ 



Inited States Senate, Select Committee 
)n Secret Military Assistance to Iran 
ind the Nicaraguan Opposition 



Oral deposition of JACOB FARBER taken at 
Three Greenway Centre, Suite 305, Route 73, 
Marlton, New Jersey, on Monday, June 1, 1987, at 
11:45 o'clock, a.m., before Harold Schulman, a 
Registered Professional Reporter and Notary Public, 
pursuant to notice. 



LPPEARANCES: 



^lO 



PRESENT; 



CHARLES KERR, ESQUIRE 

Associate Counsel 

United States Senate 

Select Committee on Secret Military 

Assistance to Iran and tne Nicaraguan 

Opposition. 

901 Hart Senate Office Building 

Washington, D.C. 20510 



DAVID FAULKHER, Investigator 



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HAROLD SCHULMAN ASSOCIATES 



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under provisions of E.0. 12356 
by O. Siriio, National Security Council 



(1) 



UNCLASSIFIED 

JACOB FARBER 



JACOB FARBER, having been duly sworn, was 

2 examined and testified as follows: 

3 BY MR. KERR: 
Q Mr. Farber, my name is Charles Kerr. I'm an 
associate counsel for the United States Senate Select 
Committee on Secret Military Assistance to Iran and the 

^ t Nicaraguan opposition. Mr. Faulkner is also here as an 



8 i investigator for the Committee. Essentially what we're 
9 ' going to go through today are some questions the Committee 
10 ; has, and I need your assistance. 

z 

n * Let me begin by starting with some background 

12 i information. Could you give us your residence, please. 



15 < Q By whom are you employed at the present time, sir? 

16 ; A By myself, self-employed. 

HjQ Do you work through a corporate entity? 

OE 

18 I A Correct. 

19 Q What entity would that be? 

20 A Farber Enterprises, Incorporated. 

21 Q What is the location? 

22 A Same as my home. 

23 Q What is the nature of the business of Farber 



o« fciMiinii 



Enterprises? 



i4-e»^ 



/ -f^y y 



under provirions of LO. 123; 
by O. SIfio, National Security Council 



imissm 



JACOB FARBER 3 

- — BtmSSifiH 

Consulting work for the U.S. government. 

Q Was there a time when you were associated with a 

firm known as Forway Industries, Inc.? 

A Correct. 

Q When were you associated with Forway Industries? 

A From July one, 1968, to October three, 1986. 

7,Q On October third, 1986, your interest in Forway was 



8 ^ purchased by someone else? 

9 -A Yes, it was purchased by Mr. Willard Zucker and 
10 - Alfred Clark. 

z 

n<Q With regard to the business of Forway Industries, 

12 : could you describe what that business was in the period 

13; that you were associated with Forway? 

14 »; A We were a leading manufacturer of militarized spare 

15 < parts in the United States, selling both domestically and 

16 ; overseas. 

w3q During the period of time July '68 through October 

< 
18 i of '86, what was your relationship to Forway? 



^ 



A I was the president of the company and the chief 

executive officer. 

Q You mentioned Mr. Zucker. How did you come to know 

Mr. Zucker? 

A Mr. Zucker is a former roommate when he lived in 

Washington many years ago and he worked for the Justice 



wmm 





JACOB FARBER 


4 


1 


UNbLHoolrlLU 

Department, he was an excellent friend, a friend 


to a very 


2 


close friend of mine whose name is Herbert Light 


who lives 


3 


in Cherry Hill. Through him I got to know him. 


When the 


4 


opportunity presented itself to retire for a former 


5 


partner of mine, Mr. Zucker, in conjunction with 


Mr. 


6 


Clark, bought fifty percent of the company. And 


that was 



7 . January first of '84. Wait, it could have been '83. 



8 ^ Q How about '82? 

9- A It could have been '82 also. Okay, '82, yes. 

10 5 Q So they bought into Forway. 

z 

11 J A Correct . 

12 i Q Sometime in 1982? 

13; A It was January. I remember that transaction 

MS occurred at the end of the year. It was either December 

15 i thirty-first or January. 

16 ; Q Mr. Zucker was associated with what firm at that 

17 3 time? 



X 

18 I A It was with his own company, with CSP. 



Q It was your understanding that CSF was a Swiss 

company? 

A Yes. Walt a minute. He bought it personally. It 

was personally bought by Willard Zucker. 

Q So Zucker was acting in his own behalf? 

A Correct. 

nit. 




^ 



JACOB FARBER 




Q Mr. Clark was associated with a firm called Clark 

2 Management? 

3 A Correct. 
Q And Clark Management would have bought into Forway 

5 at a later date? That would have been 1986? 

6 A To my knowledge, Mr. Clark bought immediately 
7 , together when my former partner was bought out. 



siQ What is the name of your former partner? 

9 - A William Blau. 

10 " Q With regard to Mr. Zucker, did you have fairly 

z 

11 « frequent contact with him after he bought into Forway? 
12 i A No. It was a very infrequent contact. 
i3;Q His relationship to Forway was essentially that of 
M « an investor as opposed to someone who had day to day 

15 < responsibility? 

16 I A Only as an investor. 

17 3 Q In terms of other people that you came into contact 

K 

18^ with, you met Mr. Albert Hakim? 



A Correct. 

Q Bow would you have met Mr. Hakim, through Zucker? 

A Yes. I believe at one time I was in Geneva on one 

of my visits to Europe, and I was introduced to Mr. Hakim 

by Mr. Zucker. 

Q What was your understanding of the relationship 



ntussro. 



JACOB FARBER 



iiHtftssm 



between ZucKer and Hakim? 
2 A Well, they were very good friends and Zucker wanted 
^ me to meet him, because according to Zucker and to Hakim, 

he was very well connected in Korea, and that he would 

5 have been useful to Forway in obtaining the possibility of 

6 submitting bids to the Korean military. And at that 

^ K meeting, Mr. Hakim offered to try to get such business, 

o 

8 ^ which never materialized. He never got a single, not even 
9 " an opportunity to offer a price let alone a purchase order 
^0; resulting from that. 

z 

11 J Q Give the place and time for me as best you can when 

12 i this meeting occurred? 

13; A Well, it was probably the spring of '83 or '84. It 

14 S was about that time. 

< 

15 1 Q So you met with Hakim. He represented that he had 
16 ; the potential to get some business for Forway; is that 

17 5 correct? 



c 

18 ^ A For Forway, yes, from Korea. 

19 Q But in fact Hakim did not succeed in getting 

20 business? 

21 A Nothing ever happened. 

22 Q In addition to Mr. Hakim, did there come a time 

23 when you met General Richard Secord? 

24 A Yes, I did. 



ONCIASSIFM 



JACOB FARBER 



ONCUSSinEO 



c_ 



Q Tell me the circumstances under which you met him. 

A I believe it was sometime in '84, '85, I don't 
remember, and he flew into Philadelphia. 

Q "He" being Secord? 

A Yes. And he asked me if we had the capability to 

build a small rocket launcher based on Soviet equipment. 

7 .And I told him that yes, in principle we could. And given 



8 ^enough time and money and samples, that we could do it. 
9 - And that was the last thing we ever heard about this 
10 - particular project. 

z 

njQ So you would have met General Secord at the 

12 ; Philadelphia Airport? 

13 ; A Correct . 

14 » Q And he was exploring with you the capability of 

15 < Forway to build a copy of a Soviet rocket launcher? 

16 5 A Yes . 

^^>°Q And you would have met Secord through whom, Zucker 

18 ^ or Hakim? 



A Through Hakim. 

Q Did Hakim indicate to you what his relationship was 

with General Secord? 

A Well, I understood they were partners. 

Q Did they identify to you the name of the business 

enterprise through which they were working? 



wmxtB 



JACOB FARBER 



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3 

4 
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t. 



A I knew all along that it was a company called 

Stanford Technology. 

Q What did you understand to be the business of 

Stanford Technology? 

A I knew that they were very much involved in 

building high security fences, and that they were 

successful in selling those fences to the Korean Nuclear 

Authority. And I also was aware that they were designing 

a kind of a concealed type of transmitter, you know, 

listening device. That, as a matter of fact, was offered 

to me for sale and they sent all the drawings to build the 

device. After I looked at -ct, I said this is a common 

item, that the art is to sell it and not to make it. I 

wasn't interested because I didn't think my company had 

the selling capabilities in that particular theater, and I 

was not interested. 

Q With regard to the listening device, you would have 

had those contacts at what point in time? 

A Probably in 1984, something like that. 

Q You would have discussed this with Mr. Hakim or Mr. 

Zucker? 

A I don't remember. Either one of the two. I don't 

remember. 

Q You would have discussed with Mr. Hakim, the plans 



mmm 



JACOB FARBER 



UNMSSIFIED 



for this device' 



A Yes. He did send me engineering plans for this 

listening device, and I reviewed it. And I determined 
that this was not the kind of business that would have 
been suitable for my company. 

Q Let me take you to 1986. Were there occasions in 

7.1986 when Mr. Zucker came to the United States to meet 




8 i with you? 

9-A Yes, there were. 

10 <- Q In terms of the number of such occasions, was it 

z 

11 jmore than once? 

12 ^ A Yes, it was. I believe that he was in the United 
13; States in January of '86, if my memory serves me right, 

14 « and I think also in March of '86 and probably again in 

< 

15 < September, late September of '86. There may have been 
16 ^ another opportunity, but I don't remember. 

17 5q The occasions you would have met with Zucker in 



c 

18^1986, these would have been business meetings? 



A Correct. 

Q And the meetings would have taken place in the New 

Jersey area? 

A At Forway, yes, at the company headquarters. 

Q And Forway's headquarters were located where? 

A In Woodbury, New Jersey. 



«tfcSS» 



10 



JACOB FARBER 



10 



wstim 



Q On the occasions when you would have met with Mr. 
Zucker, he would have been accompanied by other people as 
well in 1986? 

A Well, the first occasion he was alone, as best as I 
can recall. In the last occasion, during part of his 
visit, Mr. Hakim came over. And the purpose of Mr. 
7 c Hakim's visit was to bring another idea for business for 



8 i Forway, which was a laser operated gun sight that he 

9 ■ wanted Forway to investigate. And I performed an analysis 

10 ; of that to determine, (a) that we can manufacture it, and 

z 

11 I (b) , what the price could have been. And we offered him a 
12; price, which I don't recall at the moment. And that was 

13; the end of my dealings with Mr. Hakim, because shortly 



14 s after that my interest in Forway was purchased by Zucker 

15 < and Clark, and I ceased to have any relationships with the 

16 ; company. 

17 ^ Q He have been told that the purchase of your 

c 

18 X interest took place approximately October third. 



A That's exactly October third. 

Q And the purchasers of your interests were whom? 

A Arthur Clark and Willard Zucker. 

Q Let me just focus in on other people. Do you know 

a gentleman by the name of Gregory Zink? 

A Yes. 






11 



r 



JACOB FARBER 



11 



flmssf© 



Q How do you know Mr. Zink? 

A He was hired in March of '86 as chief financial 
officer of the company. 

Q And the company being Forway? 

A Forway, yes. 

Q Mr. Zink has given Mr. Faulkner of the Committee 

7 , some dates that he was familiar with. He placed Hakim and 




s^Zucker's visit in the fall of 1986 as having occurred 
9 - approximately Sunday, September twenty-one, 1986. The 
10 5 September twenty-one, 1986, date, does that correspond to 

z 

njyour recollection? 

« 
12 i A I think that's approximately correct. 

13 ;Q And he indicated to us that Mr. Zucker and Mr. 

14^ Hakim came to the Woodbury, New Jersey, area about Sunday, 

15 i September twenty-first, 1986, and that there were meetings 

16 5 that took place on the twenty-first of September and then 

17 3 the twenty-second, twenty-third as well. Do you recall a 



18 ^series of meetings taking place during that period of 



time? 

A 

Q 



Yes. This was when he brought the laser gun sight. 
And the person who brought the laser gun sight was 



Mr. Hakim; is that right? 

A Correct. 

Hakim was accompanied by other folks as well. Do 



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JACOB FARBER 



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20 

21 

22 

23 

24 



you recall the identities of the others? 

A I remember that there were other people that were 

sort of technical specialists that came. But I do not 

recall their names, and I do not recall where they were 

located. I believe they were located in the New Orleans 

area. But I'm trying to reach into my memory. 

Q Let me give you the names of a couple people. Do 

you recall meeting with a Bob or Robert Fritchie? 

A I don't recall the name. But it's possible, you 

know. 

Q Do you recall a meeting with a Robert Dutton, 

D U T T N? 

A NO, I don't. 

Q With regard to Mr. Hakim, do you recall whether or 

not he was accompanied by his wife when he came in in 

September of 1986? 

A I never saw her. 

Q On that trip in September of 1986, I take it 

General Secord was not present? 

A NO. 

Q I'm going to touch on some other matters, but let 

me focus you on a Saturday, September twenty-seventh, 

1986. Do you recall meeting with Mr. Zucker on Saturday, 

September twenty-seventh? 







13 



1 



JACOB FARBER 



13 



fMS» 



A Definitely, here in this office, in Mr. Cohen's 

2 office. 

3 Q Could you relate to me what you recall about the 
meeting or meetings you would have had with Mr. Zucker on 
Saturday, September twenty-seventh, 1986? 
A The subject of the meeting was the negotiations to 

7 , buy my interest in the company. They wanted to control 



8 ^ the company, and they were trying to buy me out. He met 
9 -here with Mr. Cohen and Mr. Zucker and my son-in-law, 
10; Richard Horowitz, ' who is also an attorney. Of course 

z 

11 « myself . 
« 

12 «Q The people that were present here were Mr. Cohen, 

i3;your son-in-law, Mr. Horowitz? 

u 

14 » A Yes. 

15 i Q Mr. Zucker. Anyone else? 

16; A There was nobody else at this meeting. 

17 3 Q In terms of what happened on that Saturday, can you 

18 ^ relate for me your best recollection of what happened 



vis-a-vis Mr. Zucker? 

A The purpose of the trip, the visit, was to 
negotiate an agreement of sale where I would tender my 
fifty percent ownership of Forway to Zucker and Clark. 
And we structured a deal. Of course, he was trying to buy 
for as cheap as possible and I was trying to sell for as 



muM 



14 



JACOB FARBER 



14 



UN C U S S I RED 



much as possible. And that was the subject of the 
negotiations that day. 

Q Run through me the events of that day. Was there 
more than one meeting with Zucker that day? Did you meet 
with him and break and have him come back? 
A Yes, we met. If I remember correct, we met in the 
7, morning. Zucker had to meet somebody at the airport that 




8 =! day, and he left somewheres around eleven to twelve, and 

9 " he returned sometime between one and two, approximately. 
10 5 Q In terms of the day itself, do you recall what the 

z 

" I weather was like? 

12 ^ A Yes, it was a very rainy day. 

13 5 In terms of who Zucker was meeting with at the 
Mj airport, did he indicate to you who he was meeting with? 
15 « A All he said was it was some lady who was coming up 
16; from Washington. But it was customary for him whenever he 

17 5 came to have all kinds of meetings with all kinds of 

18 ^people. So that was one more meeting to which we paid no 
particular attention. 

20 Q But you do recall him indicating he was meeting 

21 with a woman; is that correct? 

22 A As best as I can remember. 

23 Q In terms of why he was meeting with the woman, did 

24 he indicate anything for you to know why? 



fWSiffl 



15 







JACOB FARBER 15 


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2 
3 
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A 

what 

Q 

A 

Q 

with 


UNbLAoointy 

It wouldn't have been customary for me to ask him 
his private business was. 

He did not relate to you what the business was? 

No. 

Specifically in terms of the identity of the woman 
whom he was meeting, he did not indicate to you her 



7, identity; is that correct? 

3 


a i fi Correct. 

9-Q It was your understanding, however, that he was 

10 ^ meeting with her for business reasons; is that correct? 

z 

11 * A I have no idea what the purpose of the meeting was, 
12 ;Q Do you recollect when he first mentioned to you 

13; that he was going to be meeting with this woman? Was it 
14 ;;; on that Saturday? 

i5<A Yes. 

I 

16 ;Q Do you have any knowledge of anyone else who met 

17° with Zuclcer and this woman? 



18 I A I have no idea. 



Q Upon his return after meeting with that woman on 

that Saturday, did he say anything further about the 

nature of the business he had done with the woman? 

A No, he didn't. 

Q I take it that Mr. Hakim had been present earlier 

in the week; is that right? 



tmssifiw 



16 



JACOB FARBER 



16 



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15 5 

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19 

20 

21 

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23 

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A Correct. 

Q But Hakim, to the best of your knowledge, was not 

present on that Saturday? 

A No, I didn't see him. But I have no idea whether 

he was still in town or had left town. I don't know that. 

Q In terms of where Mr. Hakim had been staying when 

he was in town earlier that week, did you know where he 

was staying? 

A There are only two possibilities; either they 

stayed at the Hershey Hotel in Philadelphia or at the 

Gloucester Inn in Gloucester, New Jersey. But I don't 

know. 

Q Did you have occasion to meet, I think you said you 

did, with Hakim earlier in the week? 

A Yes. That is when we discussed the laser gun 

sight. 

Q When you discussed the laser gun sight with Hakim, 

was Mr. Zucker present at this time? 

A Yes, he was present. I believe at part of the 

meetings he was present, yes. 

The discussions that you had with Mr. Zucker on 

that Saturday, the twenty-seventh, was Zucker represented 

by counsel at that time? 

A No. He was by himself. He was representing 



liEUSSin CD 



17 



JACOB FARBER 



17 



mmm 



himself . 

Q The reason I asked is I'm trying to make sure I 
cover all people that might have known of this Saturday 
trip. There is no attorney that you know of who was there 
on behalf of Zucker on that Saturday? 
A No. 
7,Q As of that time, that Saturday, did you know at 



8 ^ that time a Lieutenant Colonel Oliver North? 
9-A No. I never heard of him. 
10 5 Q And I take it you would not have known Colonel 

z 

M< North's wife at that time either? 

12? A No. 

13 ;Q Since that time have you had occasion to meet with 

G 
14 s Colonel North? 



15 5 A 

I 

16 ; Q 

17 5 time? 



K 

18 ^ A 



No, 



I take it you do not know North at the present 



No. 

Or his family? 

No. 

With regard to the meeting that Mr. Zucker had on 
that Saturday, did he say anything that would cause you to 
believe either then or now that Zucker was meeting with 
this woman on behalf of or in conjunction with business he 



im mmn 



f ' '.fin ■ ■» « r , , n y» B ^M n s 



18 



JACOB FARBER 



18 



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was doing for Hakim oc Secord? 

A I have no idea. 

Q Let me shift gears a bit. In terms of your work 

for Forway, from the discussion that we had prior to the 

deposition, I gather there did come a time when you had 

business with General Secord on behalf of Forway; is that 

correct? 

A Correct. 

Q Could you describe that business, please? 

A Well, off the record for a minute. 

(Discussion off the record.) 
BY MR. KERR: 

Q In August, September of 1986, you had a subcontract 
through Forway to acquire certain types of radio 
equipment; is that correct? 
A Yes. 

Q In order to obtain that equipment, you made contact 
with Mr. Zucker? 



19 


A Correct. 


20 


Q Mr. Zucker suggested that you talk to General 


21 


Secord; is that correct? 


22 


A Which I did. 


23 


Q To assist you, General Secord gave you the name of 




Manny Weigensberg? ^ _ ^^.i-.*--* 

UNCLASSinED 







19 







JACOB FARBER 


19 








ift^ft i/^Airff"irv 








ONCLASSIREO 




\ 


A 


Correct . 




2 


Q 


And you then went to Mr. Weigensberg 


in that period 


3 


of 


time, August, September of 1986; is that 


right? 


4 


A 


I went in October, late October. 




5 


Q 


And Mr. Weigensberg agreed to assist 


you? 


6 


A 


Correct . 







7,Q And he was successful in helping you obtain the 



8 i radio equipment? 

9 - A Correct . 

10 5 Q Since that time you've had further dealings with 

z 

n < Mr. Weigensberg? 

12 t A Correct . 

i3;Q On related matters? 

14 5 A Yes. 

15 < Q In the subsequent dealings that you had with Mr. 

16 5 Weigensberg, they have been direct? 

17 3 a Yes. 



c 

18 ^ Q General Secord has not been involved? 



A Correct. 

Q I think I've asked this before, but just so that I 
can nail it down, to your knowledge, though, Zucker and 
Hakim were both here in this area in the period of 
September twenty-one, twenty-two, twenty-three, 1986; 



correct? 



KLiSSlHE 



20 



JACOB FARBER 



20 




E 



2 
3 
4 
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20 

21 

22 

23 

24 



A Correct. 

Q And Zucker was here by himself, as far as you know, 

on Saturday, September twenty-seventh, 1986, when Zucker 

had the meeting with the woman from Washington, D. C; is 

that correct? 

A Correct. 

Q There are a couple of things that Mr. Zink related 

to us that I would like to review with you. You've 

already indicated that you are not familiar with Robert 

Dutton of Stanford Technologies? 

A Yes. 

Q And you don't know of a man named Goff? 

A It is possible that these were people that came 

with the laser gun sight. But I don't remember their 

names. 

Q You have no knowledge of a proposal for American 

Arms to purchase from Forway a twenty-two caliber 

automatic weapon; is that right? 

A I have no idea of that. 

Q With regard to the radio transaction we discussed a 

moment ago, do you have any knowledge of the commission or 

fee paid by Forway to General Secord? 

A I'm not aware of it. 

Q Do you have knowledge of a twenty-five thousand 



mm 



21 



JACOB FARBER 



21 



iHtASSm 



dollar payment made by CSF to Forway in September of 1986 
that was used to generate cash for Mr. Zucker? 
A I have no idea. At that time I was not handling, I 
was not the chief operating officer. I was not handling 
any of the money from those transactions. 
Q The same level of inquiry, in August of 1986, do 
7 I you have knowledge of a fifty thousand dollar payment that 




e i was made by Forway to Stanford Technology as part of a 
9 -commission payment on the laser gun sights? 

10 >■ A I have no idea. I was not involved with any of the 

z 

11 'financial transactions at Forway. 

12 5 Q Do you have knowledge of a company called Hyde Park 

13 ; Square? 


MjA Never heard of it. 

15 < Q With regard to Charles Heusler of the Archer and 

lejGreiner firm, do you know Mr. Heusler? 

173a It's Heisler. I think it's H E I S L E R. 



c 

18^0 DO you know Mr. Heusler? 

A I met him once for five minutes. I don't think 
he's ever done — he tried to get Forway's legal business 
when they questioned the friendly relationship between Mr. 
Cohen and myself, and they wanted to get an independent 
counsel. And Mr. Heusler came and talked to Mr. Hade or 
Mr. Zink and talked to me for about a couple of minutes. 



f««& 



22 



^ 



JACOB FARBER 22 

ifflffi 

But I don't think that any legal business has ever been 

2 given to Heusler by Forway. 

3 Q Do you know when Heusler came on the seen? Would 
this have been in conjunction with the October third deal? 
A No. He came much earlier than that. He came in 
maybe June or July. I'm speculating. But I am almost 

'•certain he got no business from Forway. And at the 



8 i closing of they buying me out, he was not present. 
9'Q That was my next question. He did not play a role 
'0 5 in the buy out, to the best of your recollection? 

z 

11 J A No. 

12 ; Q So he wouldn't have been present on that Saturday? 
13; A No, he was not, definitely. 

u 



14 ;: Q We have a reference from Mr. Zink that Mr. Zucker 

15 I was in the Woodbury, New Jersey, area in June 1986, that 

16 J he came June second or third, that he came to Forway and 

17 J left about June fifth. Do you have any recollection of 

c 

18 t that visit by Zucker? 



A Well, it was one of the trips that he made 

concerning the financial situation of Forway, okay. 

Q You have no recollection of any mention of a 

meeting with a woman from Washington, D. C, at that point 

in time? 

A Not at that time. 



yNClASSinED 



23 



JACOB FARBER 



23 



wtftssro 



Q In terms of conversations, have you had any 
conversations with General Secord about the matters which 
are causing all the publicity since that publicity broke? 
A I called him in January or February, you know, 
because I wanted him to put pressure on Manny Weigensberg, 
you know, to expedite the shipment of the equipment. But 
7 , my understanding is that they're not on talking terms at 




8 ^ the moment. Because part of your investigation has 
9 - revealed that subsequent shipments of materials were not 
to ; bought through Manny, and he's very upset. 

z 

11 <Q But apart from his relationship with Manny, you 

« 
12? didn't discuss any of the matters that are in the papers 

13; every day, I take it? 

o 

14 5 A No. 

< 

15 < Q You didn't discuss his potential testimony? 

16 5 A No. 

17 3Q He didn't talk to you about testimony that might be 


K 

18 ^requested of you? 



A No. 

Q You have not had occasion to discuss this incident 

of Saturday, September twenty-seventh, with anybody, I 

assume, prior to being asked about it here? 

A Absolutely. 

Q Likewise, have you had any conversation with Hakim? 



mk 



mvj 



24 





1 


JACOB PARSER 2 4 


1 


A 


... UNCUSSIREO 


2 


Q 


Or Zucker? 


3 


A 


No. 


4 


Q 


About these matters? 


5 


A 


I have not talked to them since October third. 


6 


Q 


Do you have any knowledge of when Mr. Zucker might 



7 ■ be returning to the United States? 

' 



8 ^ A I have no idea. 

9'Q Do you know Roland Farina? 

10 ; A Yes, I know who he is. 

z 

11 }Q Do you have any knowledge of whether Mr. Farina may 

12 t grace our shores again? 

13; A He has never done that. His responsibility is to 

u 



14 « run the computer, and he's not connected with the business 

15 I end. He's an operations man. 

16 5 Q He did not normally travel with Mr. Zucker is what 
i73you're telling me? 

c 

18 z A The only person, to my knowledge, who does travel 



with Mr. Zucker is Mr. Zucker himself. 

Q Has anyone, to your knowledge, from the Independent 

Counsel's Office, Judge Walsh's office, been in touch with 

either you or Mr. Cohen? 

A No. 

MR. KERR: I'm fresh out of questions. We 



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25 



JACOB FARBER 



25 



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3 

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5 

6 

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19 
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21 
22 
23 
24 



yr.i) 



certainly appreciate your conversation with us on 
very short notice. You've been very helpful to us. 
In terms of this transcript, in the questions we 
reviewed with you today, the Committee does regard 
these as sensitive matters. I would be grateful if 
you would keep the matters we discussed here today 
confidential. 

THE WITNESS: I will be happy to do it. At 
the same time, I have revealed to you certain 
matters that are of great sensitivity to the 
security of the United States, and therefore, I 
request you treat them in the greatest confidence. 

MR. KERR: I understand. Specifically you're 
referring to the contractual work that related to 
General Secord? 

THE WITNESS: I'd rather not even say that. 

MR. KERR: In other words, so we're not 
missing each other, your concern relates to the 
contract work that you and I discussed basically 
off the record? 

THE WITNESS: Correct. 

MR. KERR: With regard to the transcript, 
we're trying to do it on an expedited basis. I can 
have the reporter make a copy of the transcript 



26 



JACOB FARBER 



26 



a ^ ssif i 



8£ 

£ 
9 - 

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12 : 
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14 S 

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« 

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18 » 

19 
20 
21 
22 
23 
24 



available to you for your review, to be sure there 
are no errors and the like. I would ask that the 
transcript not be copied. 

THE WITNESS: I will respect that. 

MR. KERR: Other than that, I think we're 
done. 

(Witness excused.) 

TESTIMONY CLOSED 




27 





UNWSSIHED 




i:££Xl£lS:AXlQJi 


1 
2 


I hereby certify that the proceedings. 


3 


evidence and objections noted are contained fully and 


4 


accurately in the notes taken by me in the hearing of the 


5 


above matter, and that this is a correct transcript of the 


6 


same. 



7. 

o 



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14 5 

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16 5 

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17 3 

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24 




HSROLD SCHDLMAN 

REGISTER^ PROFESSIONAL REPORTER 

NOTARY PDBLIC 



(The foregoing certification of this 
transcript does not apply to any reproduction of the same 
by any means unless under direct control and/or 
supervision of the certifying reporter.) 



IINGUSSI 



\v 



28 



OTENOGRAPmC MINUTBS 
Unrerlacd uhI Unedited 
Not for Qiiotetlon or 
DapUcatioa 



29 





Committee Hearings 
oryi* 

U^. HOUSE OP REPRESENTATTVES 



COPY NO.. 



W 



-0F.-_3 COPIES 




PsrflaBy DfldKsffled/Reteased on '~^^-'^ 

OFFICE OF THE CLERK ""'^®'' P^^'^iO"* "' E.O. 12356 



Office of Official Repoiten 



by N. Menan, National Security Council 



con NO. 



.^, A m 2 



(29) 



30 



NAME: HIR120000 tlRM^km PAGE 1 



RPTS DOTSON 
DCnX GLASSHAP 



«"% 



m 



DEPOSITION OF JEFFREY FELDHAK 

Thursday, April 30. 1987 

House of Representatives. 

Select Committee to Investigate Covert 

Arms Transactions with Iran, 
Washington, D.C. 



The Committee met, pursuant to call, at 9:>t5 a.m., in Room 
2203, Rayburn House Office Building, Pamela J. Naughton 
(Staff Counsel) presiding. 

Present: Pamela J. Naughton, Staff Counsel, Select 
Committee to Investigate Covert Arms Transactions with Iran, 
U.S. House of Representatives; Henry J. Flynn, Investigator, 
Selaet Committee on Secret Military Assistance to Iran and 
th« Nlcaraguan Opposition, United States Senate; Thomas 
HcGough, Jr., Associate Special Counsel. 



Partially Declassified/Released on 



-X^- 



m\mm 



under provisions of E.O. 12356 
by N. Menan, National Security Council 



31 



NAME 
214 
25 
26 
27 
28 
29 
30 
31 
32 
33 
3H 
35 
36 
37 
38 
39 
ilO 

m 

M2 
U3 
UU 
U5 
146 

•17 
t48 



HIR120000 



Whereupon, 



iifiUissim 



JEFFREY FELDMAH, 
was called for examination by counsel for the Select 
Connittee/ and having been duly sworn, was exanined and 
testified as follows^ 

BY HS. HAUGHTOK: 
2 We are on the record. It is April 30, 1987. X am 
Pamela Naughton, Staff Counsel with the House Select 
Committee to Investigate Covert Arms Transactions with Iran. 
The people in the room will please introduce themselves. 

MR. nCGOUGH: Tom HcGough, Associate Special 
Counsel, Select Committee on Secret Military Assistance to 
Iran. 

HR. FLYHH: Henry J. Flynn, Investigator with the 
Select Committee. 

THE WITNESS: Jeffrey Feldman, Assistant U.S. 
Attorney, the Southern District o£ Florida. 

What is my status before the committee in this 
proceeding? 

MS. NAUGHTON: Simply as a witness. He are doing 
many interviews, conducting many, many depositions of 
vazlous people throughout the government and private 
citizens . 

You are entitled to personal counsel at any time . 
I don't see any reason for it, but that, of course, is your 



UNCLASSIFIED 



32 



NAME: 

U9 
50 
51 
52 
53 
5i» 
55 
56 
57 
58 
59 
60 
61 
62 
63 
6U 
65 
66 
67 
68 
69 
70 
71 
72 
73 



HIR120000 



UNCUSSIRED 



PAGE 



choj.ce. You can certainly do that xi you like. All we want 
to get at is the truth, and that is what we are here for. 

The deposition is taken in Executive Session, which 
means that it is secret materials. It sealed in a vault. 
Copies aren't even released to anyone, even to the witness. 
The witness can view it and make corrections but cannot 
retain a copy. A copy goes to no one else, it is only 
disseminated at a hearing upon majority vote of the 
committee membership. He are in contempt of Congress if we 
give out any information in a deposition, so it is entirely 
secret. Do you have any other questions? 

THE WITNESS : Ko . 

BY ns. HAUGHTON: 
S Let's get the basics. How long have you been in 



ESA? 



A Since January of '85. 

2 What did you do before that? 

A I was Assistant State Attorney in Miami . 

S For what years? 

A 1981 through 1985. 

fi What did you do before that? 

A I went to school. 

2 Graduated from law school in '81? 

A That is right. 

Q What law school? 



UNCUSSIHEO 



33 



HAKE: 
7H 
75 
76 
77 
78 
79 
80 
81 
82 
83 
8>4 
85 
86 
87 
88 
89 
90 
91 
92 
93 
9U 
95 
96 
97 
98 



HIR120000 



uNcussra 



PAGE 



A University of Florida. 

S Have you held any other positions with the 
government other than those two? 

A Ko. 

S Are you in any special unit at the U.S. Attorney's 
Oiiice? 

A I think they're calling it the Contra Investigative 
Unit now. I an technically assigned to — that is a joke, for 
the record--! am assigned to major narcotics. 

e Is that the task force? 

A No, the task force is a — well, we have OCDEir, which 
I guess is a task force, and I am a member of OCDETF in the 
Southern District of Florida. It's Organized Crime Drug 
Enforcement Task Force. 0-C-D-E-T-F. 

e Have you been with that unit since January, 1985? 

A No , I have been with that unit since February 25, 
1986. 

2 And before that, what was your assignment? 

A Prosecution of violations committed against the 
Neutrality Act. 

S Here you involved in the Cutter case at all? 

A Ho. Cutter? 

e You haven't heard of that case? 

A No. Perhaps ydu should give me some more details. 
I may be familiar with it, but perhaps not by that name. 



UNCUSSIF1ED 



34 



NAME: 
99 
100 
101 
102 
103 
10M 
105 
106 
107 
108 
109 
110 
1 1 1 
1 12 
1 13 
1 m 
1 15 
1 16 
1 17 
118 
1 19 
120 
121 
122 
123 



HIR120000 



UNCIASSIRED 



PAGE 



2 It had to do with arms sales transactions . The 
defendants were two guys fron Long Island. 

A No. 

e Did there cone a time in early 1985 that you began 
investigating the alleged Neutrality Act violations 
concerning activity in Central America? 

A Yes. 

Q Can you tell me how that came to your attention? 

A Let me tell you what I have dona. If you want to 
proceed diif erently--the record should reflect I prepared a 
complete chronology > starting with my involvement with the 
Jesus Garcia matter, basically up to present, supporting 
documents for the activities which I have specified as 
having occurred on specific dates. If you want me to, I can 
go through the entire chronology and show you the supporting 
document. Otherwise, we can take it one step at a time. 

2 He will take it one step at a time, but using your 
chronology would be great. Hhy don't you go through the 
first date on your chronology. 

A I got into this by prosecuting a man named Jesus 
Garcia. Garcia, in August of '85. was charged with 
possessing an un-serialized and un-reglstered machine gun 
and silencer. It was four counts. On or around December 12 
or Oeeembez 10. somewhere in that area, he was convicted; 
and on December 17 of 1985. I met with Garcla's lawyer, John 



UNCUssra 



35 



UNCLASSIHED 



KinZ- HIR120000 w- - w— - -w W-- - — w ^j^^^ 



\2H 
125 
126 
127 
128 
129 
130 
131 
132 
133 
13>4 
135 
136 
137 
138 
139 
140 

mi 

1t(2 
1((3 

ms 

1(46 
147 
118 



Mattes. H« had Indicatad to ma that Mr. Garcia wanted to 
offer his cooperation to the governnent regarding historical 
conspiracy, and we went ahead and net on the 17th and 
reached agreement that on January 3 of 1986 we would speak 
further about this. 

Between December 17 and January 3, I have several 
notations that I had met with the case agents in this 
matter, George Kyzinski and D.C. Diaz, who is an officer 
with the City of Miami Special Investigative Section. 

2 Could I stop you there for a minute? The gun case, 
was that an FBI case? 

A It was sort of odd, because there were a ntimbet of 
agencies involved in the gun case. It came to me as an XTT 
case. I was on duty. It was basically to handle any 
citizens complaint, to fill out arrest complaints, just 
answer questions that agents may have, and I was contacted 
by Dennis Hamburger, who is an agent with the Bureau of 
Alcohol, Tobacco and Firearms, and he told me that he had 
just seized a gun, and he wanted me to take a look at it and 
brought it to my office, and from that point on, I was 
involved, but the Bureau of Alcohol, Tobacco and Firearms 
got involved only after the FBI and City of Miami had been 
involved . 

I would say the City of Hiami--the City of Miami was 
the primary investigative agency. The FBI was the agency 



UNCUSSIFIED 



36 



uNcussm 



HAHE: HIR120000 '-^ ■ ■ Wfcf i ^/^ 1 1 |^IJ pjGE 



1l»9 
150 
151 
152 
153 
1514 
155 
156 
157 
158 
159 
160 
161 
162 
163 
16M 
165 
166 
167 
168 
169 
170 
171 
172 
173 



that got the phone call. They passed it on to the City of 
Miani. The City made seizure of the weapon, and once it was 
seized, they contacted the Bureau of Alcohol, Tobacco and 
Firearms, and they conducted the follow-up investigation 
under--they followed up with U.S. phone calls and ultimately 
made the arrest. 

8 When the defense attorney cane to see you to set up 
the appointment with the agents, why was it the ATF wasn't 
called in along with the FBI? 

A Because, quite frankly, the ATF at that point had 
no jurisdiction in the matter. Dennis Hanburgez was in the 
Garcia matter after the conviction, and the FBI has primary 
jurisdiction over neutrality matters, and the FBI was the 
agency that was following up these matters. 

You have to realize at the time there was another 
investigation going on by the Bureau and by the City of 
Miami. They were investigating Renee Corbo, doing a 
surveillance of Rene* Corbo, and it turned out the people 
involved in the surveillance were also the same two agents 
involved in the Garcia matter, and that is how I basically 
got brought into the Corbo matter, because I Knew the agents 
fzoB the Garcia case. That's the way it happened. There 
was no conscious purpose to leaving them out. It is just-- 

2 Ko, I am not suggesting there was. I want to 
understand who was involved. In your mind then, in January 



iNCLASSra 



37 



NAHE: 
174 
175 
176 
177 
178 
179 
180 
181 
182 
183 
18U 
185 

' 186 
187 
188 
189 
190 
191 
192 
193 
19H 
195 
196 
197 
198 



HIRt20000 



UNCLASSIHED 



PAGE 



8 



this was a Neutrality Act case? 

A I don't know what it was. Garcia had bean 
naking — had suggested from the beginning that there was 
something nore to his case than simple possession of a 
machine gun and silencer, and I think I became very well 
aware oi that on October 31 of 1985 when we had the motion 
to suppress in the case. 

But at that time he was talking about. Garcia was 
talking about a plot to blow up the Cuban and Russian 
Embassies in Managua, and ultimately that just bombed out. 
He was not able to develop any evidence other than to show 
that a man named Allen Saum. who was a government witness, 
made allegations to that effect or had suggested he was 
planning something to that effect. 

As far as investigating a plot on a United States 
Ambassador or blowing up the U.S. Embassy in Costa Rica. 
Garcia didn't say anything about that until after his 
conviction . 

2 Garcia pled guilty or was tried? 

A Ho, ha was tried. 

fi There was a trial? 

A Yes. 

fi Hhat was his defense at trial? 

A His defense was he was entrapped, which was 
completely bizarre, because he had the gun in his house 



UNCLASSIFIED 



38 



NAHE: 

199 
200 
201 
202 
203 
20M 
205 
206 
207 
208 
209 
210 
211 
212 
213 
21'* 
215 
216 
217 
218 
219 
220 
221 
222 
223 



HIR120000 



UNCUSSIFIED 



PAGE 



beioie the alleged government agent entered the pzenise and 
had sold the weapon before the alleged government agent had 
entered his premise . 

fi So his defense was not I was working for the U.S. 
government? 

A No. Well, yes, that was his defense, that he 
thought he was working for the U.S. Government, and that is 
why he purchased the fire arm. But he was unable to 
establish that. 

Q Did he claim for whom in the government? 

A Major Alan Saum, S-a-u-m. Saum apparently did 
represent himself as such, but he lied. And I know that for 
a fact, because I obtained Saun's military records, and he 
was booted out of boot camp for behavioral problems . He was 
crying and couldn't survive boot camp. He didn't last more 
than a month or two weeks . 

Q Now, when you met with Hr . Mattes and the two FBI 
agents, what happened? 

A Basically the only recollection I have on the 
meeting on January 3 was we obtained permission to debrief 
Garcia, and Garcia Was debriefn/on January 7, 1986. That was 
thtt first time that he ever mentioned, and I an readying 
fzoa an FBI 302 dated — actually, it is an FBI memo, dated 
3/21/86. I am referring to page two, where it's stated: 
•'It was during the January 7, '86 interview Garcia first 



iWSSIflED 



39 



KAnE = 
22U 
225 
226 
227 
228 
229 
230 
231 
232 
233 
2314 
235 
236 
237 
238 
239 
2140 
241 
2(42 
2143 
2(4 >4 
2(45 
2(46 
2(47 
2(48 



HIR120000 



UNCUSSIHED 



PAGE 10 



nade the allegations concerning the plot hatched in 
February, '85 in Miami to assassinate Lewis Tanbs in Costa 
Rica and later blame the hit on the Sandinistas. 

2 Garcia hadn't been sentenced at this point, is that 
right? 

A No. 

2 What did you promise in exchange for the 
opportunity to debriei him? 

A Really nothing. We have correspondence to show we 
never reached an agreement. It was just he was willing to 
give us a proffer, to give us a complete debriefing and to 
be polygraphed on it> and we basically proceeded with the 
understanding if we could work something out> we could work 
something out. 

It ultimately could have been a recommendation at 
sentencing his sentence be mitigated because he assisted in 
development of, you know, of a historical conspiracy case, 
but we never reached any agreement, although we had worked 
towards that goal. 

2 So at sentencing, did you take that into 
consideration? 

A Ko, because, in my opinion, Mr. Garcia lied. 

2 Hhen was he sentenced? 

A Garcia was sentenced September-- 

2 September? 



UNCLASSIFIED 



40 



NAME: HIR120000 PAGE 11 

249 A --15 of 1986. 



UNCLASSIFIED 



UNCUSSIFIED 



41 



NAME: 
250 
251 
252 
253 
254 
255 
256 
257 
258 
259 
260 
261 
262 
263 
264 
265 
266 
267 
268 
269 
270 
271 
272 
273 
274 



HIR120000 



DCHN GLASSNAP 




■%o 



PAGE 12 



To what? 



m 



A I think it was three years on each count. The 
court suspended sentence on two of the counts and imposed 
probation consecutive to the jail term on the iirst two 
counts . 

2 You debriefed him on January 7, you said? 

A I didn't, the agents did> with Hr . Hattes. and I 
think Kr . Amestri present. 

Q Who is rtr . Amestri? 

A Mr. Amestri is an investigator at the Publlo 
Defender's Office. 

8 What did Garcia tell them? 

A I don't have a copy of the Garcia 302, and I could 
synopsize it. I basically said that — actually, rather than 
synopsize it, let me read a portion off of the FBI report 
that I have here. Again, referring to the FBI report, dated 
3-21-86, it states, the top paragraph, page two, ''On 
January 7, '86, Garcia was interviewed by the FBI with 
Hattes and Amestri at the Metropolitan Corrections Center in 
niaal. It was during this IntervlaM he made the allegations 
oi a plot hatched in 1985 in Mlaiii to assassinate U.S. 
Ambassador Tambs. Although Garcia freely spoke out against 
the Anexleans involved in the plot, he refused to speak out 



ONCLASSIFIED 



42 



NAME: 
275 
276 
277 
278 
279 
280 
281 
282 
283 
2814 
285 
286 
287 
288 
289 
290 
291 
292 
293 
29>« 
295 
296 
297 
298 
299 



HIR120000 



ONClASSm 



PAGE 13 



on the gun-running situation involved in the plot.*' 

Q Did he outline a Contra re-supply network and 
program? 

A )(o, not that I recall. The essence of his 
allegation was he met Tom Posey--this is from my recollection 
nou--he met Tom Posey in January of '86. Posey returned in 
February-- 

e 1985? 

A February, '85, you are right. Posey returned to 
enter a plea to carrying a concealed fire arm in Hiani. 
During that time, he got in touch with Garcia. They met, 
Posey at that point suggested that the embassy be broken up 
and that the Ambassador be killed. Ambassador Tambs be 
killed to collect the bounty placed on these people. Garcia 
said the participants of the plot, Stephen Carr, Robert 
Thompson, Sam Hall, Peter Glibbery, and Tom Posey, and I 
believe Bruce Jones, he had also mentioned, was involved, 
that Garcia attended a meeting at the Howard Johnson's near 
the airport in Miami — 

e Wait a minute. I want to get the names. Hall — 

A H-a-1-1, Sam Hall. 

2 Sam Hall — what is Thompson's first name? 

A Robert. 

S Hho else? 

A Stephen Carr, Bruce Jones, peter Glibbery. 



UNCLftSSIFIED 



43 



NAnE = 
300 
301 
302 
303 
30M 
305 
306 
307 
308 
309 
310 
31 1 
312 
313 
31U 
315 
316 
317 
318 
319 
320 
321 
322 
323 
32i« 



HIR120000 



UNCUSSIRED 



PAGE 114 



Q Axe these all people associated with CHE? 

A At this point, I don't think X can answer the 
question. I have been told not to go into any matters 
pertaining to the investigation itseli. I can only tell you 
what my recollection--! think if I go beyond that at this 
point, I would be going into natter we discovered during the 
course of the investigation. I have no problem personally 
answering it. 

Q I interrupted you, I am sorry. You mentioned these 
people. And then what happened? 

A He said he had a meeting at the Howard Johnson's 
where Stephen Carr pulled out a sat oi blueprints oi the 
American Embassy in Costa Rica and basically laid out a plan 
to blow up the embassy and kill the Ambassador, and he said 
that because he was aware of this plan, Tom Posey decided 
that he had to be taken--he, Garcia — had to be taken out, and 
that is why Tom Posey sent Alan Saum to Miami in July of 
1985. He alleged that Saum came to Miami with the intent of 
setting Garcia up and/or taking him to Central America to 
kill him. And that is why he is where he is today. He said 
that he refused to speak about the involvement of the Cuban 
faotlon in this plan. He would not go into that. I think 
that is a fair summary of what I remember about the Garcia 
debriefing . 

I spoke to John Mattes about this. I don't know if 



IINCUSSIFIED 



44 



325 
326 
327 
328 
329 
330 
331 
332 
333 
334 
335 
336 
337 
338 
339 
340 
3U1 
3>42 
343 
344 
345 
346 
347 
348 
349 



HIR120000 



UNCUSSIFIED 



PAGE 15 



you want to go into this at this point. 
2 Sure . 

A Firstf there is a couple things you have got to 
consider. I've been a prosecutor ioz almost seven years in 
nianii--the thought oi hearing about CIA plots is nothing new. 

The public authority defense is asserted, I think, iiore 
frequently in Miani than it is in other parts of the 
country. I have seen it. 

Just based on ny own investigation of Alan Saun and 
knowing what I knew about Alan Saun, I knew that he was not 
involved with the government. I had Kevin Currier gat^ 
involved to see if Saum did work for any agency. Currier 
testified at trial Saum was not employed by any military 
agency. X got his military records, which showed him at 
best of being a cry baby. 

After speaking with Alan Saum at length. I was 
convinced he was a fraud. At the same time. I never 
understood, to this day I don't understand why Saum came to 
Miami and contacted Garcia. It is still a mystery in my 
mind. So I never really accepted Garcia's acclaim he was 
working for the government. During the entire time between 
his arrest and trial, there was never an allegation made 
Garola was involved in an assassination plot or he had been 
set up by Tom Posey. 

In fact, he had subpoenaed Tom Posey as a defense 



UNCLASSIFIED 



45 



NAME: 
350 
351 
352 
353 
3514 
355 
356 
357 
358 
359 
360 
361 
362 
363 
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365 
366 
367 
368 
369 
370 
371 
372 
373 
374 



HIR120000 



UNCLASSIHEO 



PAGE 



16 



witness. So when Garcia made the allegation in January 
about the assassination plot, I was skeptical. I became 
even more skeptical on March 1 U when John Mattes advised me 
that the first time that he ever learned about the 
assassination plot was after he had spoken with Martha 
Honey, and Mattes also told me--let me refer to my notes. 
2 She is a reporter for whom? 

A She is a stringer for several papers. She is an 
American, works down in Costa Rica. 

This is what — I have a note here for March 14. In 
September of '85, Martha Honey, Times, CBS, calls and says 
''Are you sure your client was not involved in the American 
Embassy hit in Costa Rica? And Mattes said, all Mattes knew 
was Saum's story of '85, which was the Russian Embassy hit 
in Managua. 

Then John went on later to tell me the first time 
Garcia ever mentioned anything to him about this 
assassination plot was after he had spoken with Martha 
Honey. This plus several other factors ultimately led to my 
discounting the existence of this assassination plot. 

MR. nCGOUGH: You said the first time Mattes 
laaxned of it was after he had spoken to Martha Honey. He, 
Mattes, or he — 

A He, Mattes. 

From what I gather, both of then learned about the 



wussm 



46 



NAME: 
375 
376 
%11 
378 
379 
380 
381 
382 
383 
3814 
385 
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387 
388 
389 
390 
391 
392 
393 
394 
395 
396 
397 
398 
399 



HIR120000 



UNCLASSIFIED 



PAGE 17 



assassination plot ixom Martha Honey. Garcia never made any 
mention of it at all ixom the time he was arrested to the 
time he was convicted, even at the motion to suppress where 
Mattes was given the opportunity to cross-examine Saum, but 
there never was a question raised about Garcia's involvement 
in the assassination plot. 

So I guess'-getting back to the chronology, you got 
to realize that nothing was discounted. It was a definite 
change. When we went ahead and decided to speak with Garcia 
and to listen to his story, there was no decision outright 
to exclude what he said was true. He basically went in. we 
listened to him. and then we wanted to polygraph him, and 
that was the next step. 

I believe on January m of '85 Garcia was 
polygraphed. He was polygraphed on three issues. The first 
issue was his involvement — I an sorry. Tom Posey's 
involvement in the plot. The second issue was whether the 
plot existed, and the third issue was some reference to 
Garcia's involvement in other criminal activity in the Miami 
area. 

For purposes of this proceeding, the first two 
isauAS were irrelevant. On the issue of the existence of a 
plot, he was deemed to come out inconclusive. They couldn't 
say one way or another, whether he was telling the truth. 
With respect to Tom Posey's involvement, he was deemed 



wussro 



47 



HAME: 
400 
U01 
(402 
403 
404 
405 
406 
407 
408 
409 
410 
41 1 
412 
413 
414 
415 
416 
417 
418 
419 
420 
421 
422 
423 
424 



HIR120000 



deceptiv 



. UNCLASSIFIED 



PAGE 18 



Hhen conitonted with the deceptions the machine 
picked up, he admitted he had lied about Posey's 
involvement. 

2 Going back ior a moment to the machine gun, did you 
trade it? 

A I am sorry. 

8 Did you trace it? 

A The machine gun? 

e Yes . 

A No . It had no serial number on it. He admitted 
who he bought it from. 

2 Who did he say he bought it from? 

A A man named Chlno. 

2 Has it ever traced to Posey? 

A No . It couldn't be. because Garcia made a 
statement, alleged statement, to a person at ncc saying that 
the machine gun had come from Tom Posey, but at trial, under 
oath, he testified that the gun had coma from Chino . And on 
March 14, I spoke with John Mattes; Mattes told me the gun 
had come from Chlno. 

e So he admitted he lied about Posey. Has that out 
of whole cloth? 

A I am sorry. 

2 Has that out of whole cloth? What did he finally 



UNCLASSIFIED 



48 



NAME: 
42S 
426 
427 
428 
429 
430 
431 
432 
433 
434 
435 
436 
437 
438 
439 
440 
441 
442 
443 
444 
445 
446 
447 
448 
449 



HIR120000 



tell you? 



UNCUSSIFIED 



PAGE 19 



A I have the polygraph report. He never really 
changed his story. The iact was because the existence of 
the plot came out inconclusive, that in and of itself made 
it worth exploring. 

Miami is a Casablanca. I don't discount anything 
others say. I wasn't quite sure he was telling the truth at 
that point, but there was no way that I was going to say, 
no, this case is closed. So on January 22 of '86, we had a 
meeting at the Public Defender's Office, Kevin Currier, 
George Kyzinski, an agent named Herb Cousins, myself, John 
Mattes, met in the Public Defender's Office around 5:00 p.m. 

Basically, we all a^raad without more, Garcia's 
story is not going to amount to a hill of beans, because, 
number one, he was deceptive with respect to Posey's 
involvement. There was no corroboration at that point of 
anything that he was saying, and ha refused to, Garcia 
refused to talk about the involvement of certain Cubans in 
this so-called plot. Garcia was really not offering us much 
at that point. 

On top of it, he had completely changed his defense 
now. He was saying he got involved in this machine gun case 
through his involvement in the assassination plot with Tom 
Posey in January, '85 whereas at trial he had said he got 
involved with this machine gun case because he was involved 



UNCUISSinED 



49 



HAME' 
^50 
451 
452 
453 
454 
455 
456 
457 
458 
459 
460 
461 
462 
463 
464 
465 
466 
467 
468 
469 
470 
471 
472 
473 
474 



HIR120000 



UNCLASSIFIED 



PAGE 20 



in a plot to blow up the Cuban and Russian Embassies in 
Managua. He had changed his story completely. He was not 
too strong on January 22 of '86. 

2 Hasn't he sort of like a prison guard or something? 

A Yes. He uas a corporal at the jail, Dade County 
Jail. 

Q Go ahead. I am sorry. 

A So what ue did on the 22nd is after the meeting 
with Mattes, I went back to my office and met with the 
agents--! have notes that you are all entitled to look at. I 
can't give any of the documents to you because it has to go 
through somebody at Justice. Would you like to see this? 

S Yes. 

A For the record, I am showing counsel the copies of 
my notes from January 22. I am showing you the records. 
On the first page, you will see that there is a 
series of cate9ories--let me see. X think the reason we 
called it Corbo I is at that time there was two cases, the 
ongoing surveillance and the historical case. At this time, 
ue were talking about the historical case. But, basically, 
you have suspects, and I have listed Posey, Carr, Thompson, 
Glibbery, Jones, Hall, John Hull, Corbo, Capito, who is 
Francisco Hernandez, and then — 

2 What do you know about John Hull? 

A Informer. 



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2 Why do you have him as a suspect? 

A Because at this time--I an not zeally sure. I know 
his name came up. I don't know if it was through John — not 
John Mattes, but through Jack Terrell. The statement was 
taken of Jack Terrell. Terrell had mentioned Hull's name. 
Hull came up early. I think Bruce Jones worked for John 
Hull. I can't tell you specifically. 

Likewise, I don't know how Corbo came into it on 
the 22nd, because Garcia had not mentioned Corbo on his 
initial debriefing. He had lots of conversations, and 
somehow or other this is the list of names we came into. Z 
can go back and check the initial correspondence. 

8 Here you looking at Hull for drugs only or for gun 
running? 

A Ho , at this point, I would say the events we were 
looking at specified here are the Howard Johnson's meeting 2- 
85 where this alleged assassination plot occurred, and we 
have the arrest of Thompson, and I would also think the 
March 6 gun shipment. Garcia talked about that. I failed 
to mention that earlier. 

In his statement on the 17th, he mentioned the 
waapons that were going to be used fox this operation 
against the embassy in Costa Rica were on board the March 
gun flight. So we were looking, I think at this time we 
were looking at the existence of an assassination plot, and 



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ue also looked at the likelihood oi the March 6 shipment. I 
think those were the basic perimeters. 

And we went back--upon referring back to the notes, 
on January 22> on page two, under Category C, corroboration, 
we decided we would have to corroborate the presence in the 
hotel oi the alleged members oi the conspiracy, and we wrote 
down a list oi things that we could do in order to 
corroborate Garcia. 

Now, the substance oi the meeting, we wanted to 
interview people who allegedly had information concerning 
the plot and then iinally the ilight, March 6 ilight. such 
things as FAA ilight record and pilot--and so iorth; and then 
proving the bounty against the Ambassador oi the embassy, we 
were thinking oi getting all the documents used for Thompson 
because we felt at that point we would have a hard tine 
interviewing Bachoa. 

Q Was he in jail? 

A Bachoa? 

S Yes . 

A I don't know. 

C In Spain you mean? 

A I don't know. 

But, basically, speak with Carr, get records 
corroborating the ilight, hotel records. So there was--even 
aiter the January 22 meeting where Mattes and myself and 




52 



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everyone else was there, we had concluded we needed 
corroboration. The Governnent people went back and drew up 
the strategy on how we could try to naka sonething of what 
Garcia was saying. 

The next principal event--the record should reflect 
I an skipping over portions of this and going on to what I 
consider to be the material events. 

Following the 22, I would say that I did very 
little on the Garcia matter until March 11. Between the 22 
and the It I had begun a Jury tanpering investigation of a 
major, major trial that ended in a mistrial down in Miami, 
the Sunshine State Bank investigation. I had to prepare for 
a 13-defendant boat case, marijuana boat case, that had been 
mis-tried. I had begun preparation on the case, the United 
States versus Rafael Soto, which was at that time the 
largest maritime seizure of cocaine in the history of the 
country. And I had left on annual leave, and X had also in 
that period moved up from major crimes to major narcotics. 

So I was preparing for vacation, preparing for 
transition up to major narcotics, and I had begun several 
other matters. 

ft Excuse ma. The Soto case, did that have any 
relation to the Narter District in Florida? 
A Hot that I know of. 
Q I am sorry, go ahead. 



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A I returned to work iron annual leave on February 
25, and from February 25 to Harch ^U, my recollection is I 
did, I worked strictly on Operation Birdnan, which was an 
international nethaqualone conspiracy, which is the ton of 
cocaine case, the re-trial of Ponce OeHoore . I began 
working on the boiler roon, which was a major fraud case, 
and I had also continued work on the Sunshine State Bank 
Case . 

In all candor, the Garcia natter at that point 
really had becone a lesser priority because I had, in ny 
opinion, other natters pending. The allegations being nade 
by Garcia were historical and the plot was to have — if the 
plot was said to have existed in February of *85 and the 
embassy destruction and the assassination was supposed to 
have occurred in March, and since we are alnost a year 
later, all we were doing was exploring the historical 
conspiracy . 



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So on Maxch m, X would say it was the next day 
that I have any real involvement again in the case. And 
what happened on March 13, I believe, Kevin Cuxxier called 
me and informed me he wanted to see me and John Mattes 
wanted to see me. I said, fine, no problem. We--Kevin was 
supposed to come in, in fact, did come in at nine o'clock on 
March It and Mattes was set for two o'clock that afternoon. 
When Kevin came in, Kevin brought with him a series 
of Customs declaration forms pertaining to the March 6 
flight, and he had also brought copies of hotel bills which 
tended to corroborate Garcia's claim that Carx and Thompson 
were at a particular hotel in Miami. 

The finding of these documents was significant 
because it — you know, at last there was some physical 
corroboration of Garcia's allegations. As soon as I saw the 
documents, I took them down to Ana Barnett, one of the chief 
assistants and Kevin was with me. He just began talking 
about the case, and it was at that point that I spoke with 
Leon for the very first time about this whole matter. Leon 
caaa into Ana's office and — 

fi Just happened to come by? 

A Just happened to come by. You have to know Leon 
and — he is constantly walking up and down the hallway. 



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26 



MR. HcGOUGH: What was Ana's last name? 
THE WITHESS : Barnett. He came into the office and 
said, ''Does anybody knou anything about these mercenaries 
down in Costa Rica?'' That's exactly what we are talking 
about right now. 

BY HS. NAUGHTOK! 

S Yes. 

A He basically wanted to Know what we had. Kevin, 
myself. Ana and Leon wanted to--at the time Joe HcSorley's 
office, and we began discussing exactly what we had. When I 
say exactly, you know, it's--we had, I think, a basic 
understanding of what we were looking into, but there 
obviously was a lot more. There was something — ^something 
that went on. My whole feeling was I didn't think Garcia 
was telling the truth about the plot, but it was apparent 
that he knew about events that had gone on in niami the year 
before, and there was something--something going on down 
here. He just went through what we had. 

Q Excuse me. Did Kellner tell you why he was 
inquiring? That is kind of out of the blue? 

A Apparently he had gotten a phone call from Justice. 
Ikat was ay impression. 

8 Did he say from whom? 

A No. Not that I recall. X just remember him coming 
in and--like right away, I had very little contact with Leon 



mtussw 



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up to that point. He took an interest in this; it shot up 
iron case nunbez ten on my list to — zoom> right to the top. 
Right away Leon expressed an interest and he told me that 
there was a likelihood I could be going to Costa Rica. I do 
not Know exactly when that was > but it was sometime between 
March 1U and March 17 because on March 17 X have a note that 
I called Tony Avirgon, who is Martha Honey's husband, and 
advised him I wanted to travel during the week of Easter and 
he advised me not to come. So sometime within the three 
days between March 14 and March 17, I was told to go to 
Costa Rica. 

In any event, we spoke with Leon, told him exactly 
what we had and then met with Mattes at two o'clock. At 
that meeting my intent--he had requested the meeting, but it 
was my intention at that point to iind out everything that 
he had discovered. Mattes was pursuing this case like a mad 
dog. Regardless of the allegations he made against me, I 
got to give him credit because he worked hard ior his 
client. He had gone to Costa Rica and spoken to people who 
we had previously classified as targets and perhaps 
witnesses, but Z would say on March It the people that he 
had spoken to in Costa Rica were considered possible targets 
of the case because according to Garcia. Carr and Thompson 
and Glibbery were involved in the assassination plot. 

Basically what I wanted to do on the mth when John 



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cane in was to go through everything that he had learned 
from the inception of his involvenent in the case right up 
till present. The way we started was his involvement from 
the day that his client was arrested and we were going to 
take it all the way up to present 

There are allegations made about the March It 
meeting. Do you want me to cover this cumulatively? Should 
I just hit the high points? 

8 I have read the articles regarding Mattes. I am 
not particularly concerned with it. So if it is not 
pertinent to the facts — 

A Basically what happened on the IMth, wa got as far 
as the point of Garcia's arrest up until the end of the 
trial, where Martha Honey came in and apprised Garcia of the 
assassination plot. I remember the meeting ended with my 
asking Mattes when was the first time your client ever 
mentioned anything about the assassination plot to you. He 
said if Martha Honey spoke to him. 

Then we went on. I reaember during the course of 
the meeting I told John that we had gotten information that 
he may be misrepresenting his authority because we had 
gotten correspondence from the U.S. Embassy in Costa Rica 
reflecting letters that Carr and Glibbery sent to the 
Embassy saying that Tony Avirgon had come to see them and 
implied that they were going to be indicted unless they 



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PAGE 29 



coopeiated uith tha FBI. 



fi Who is Tony Avixgon? 

A naxtha Honey's husband. He is also a reporter. 

Q Okay. 

A Avirgon told Carr and Glibbery — Avirgon told Carr 
and Glibbery he was an enissaxy from the FBI and was 
authorized to extend immunity to them, them being Carr and 
Glibbery/ and that Mattes was the one who had authorized him 
to make these representations to Carr and Glibbery. 

The ultimate allegation was that Mattes through 
Glibbery--through Avirgon extended immunity to Carr and 
Glibbery. Oi course, it was only hearsay, but we — Mattes 
also told the agents on March 12 ox Maxch 13 — March 13, the 
day he got back form Costa Rica, he admitted speaking with 
Carr and Glibbery and some of the other mercenaries who were 
down there and he told — Mattes told the agents that he 
advised Carr and Glibbery and the rest of them not to talk 
uith the Bureau unless Mattes was present. I basically told 
John that, number one, if he was authorizing or extending " 
immunity to witnesses, that is improper, because he has no 
authority to do that. Kumber two, he shouldn't be going 
around telling witnesses not to talk with the FBI. You 
know, this is reflected in a report, reflected in the 3-21 
report. I told John that he can't go around telling 
witnesses not to speak with the department, not to speak 



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with the Bureau. You know. I said that's just not the uay 
to do it. He can't do that. You are not authorized to do 
that. 

I advised Mattes that there's a likelihood that if 
ue impaneled a grand jury he uould be called as a witness 
because he took statements from Carr and Thompson — Carr and 
Glibbery who at the time were subjects and the statements to 
him were evidence, and that was essentially--that was 
essentially it. We had a very long discussion. I think the 
whole meeting took about three and a half hours and had 13 
pages of notes that I took. 

Ue left with the understanding he would coma back 
on March 18 and continue where we had left off. That is 
basically--at that point it ended with Mattes. 

On March 17, I spoke with Tony Avirgon in Costa 
Rica and basically advised him I was coming down and was 
trying to work out a date. I have a note that Avirgon 
advised me not to travel the week of Easter, advised me to 
travel U-7-86, advised me Mattes was in Costa Rica with a 
staff person and Senator Kerry. That was surprising. I did 
not know ha had been with someone from Senator Kerry's 
office. Mattes advised me he and his wife were targets of a 
grand jury investigation, said he would send copies of all 
correspondence and articles to me. I didn't know where John 
got that from, but marked Honey being a target or him being 



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a target oi a gxand jury Investigation. At this point 
Mattes was starting to go off the deep end. 

It was also on the 17th that ue got a phone 
call — when I say we. I am not quite sure who got it. Hy 
recollection is that Leon told me Justice had called him and 
requested a continuance in the Garcia sentencing. Between 
March IM and 17, it was a lot of momentum building up. Ue 
were supposed to--Mattes — Garcia was supposed to be sentenced 
the following day--no. two days later, the 19th. We filed a 
continuance. It was granted. That at the time was the 
second continuance. The third continuance now on 
sentencing. The first continuance was January It of '86 and 
February 11 of '86; those were both continuances' filed by 
John alleging that sentencing should not occur because 
Garcia was still cooperating. Then we filed the continuance 
on the 19th. 

2 What reasons did you give? 

A Just that--I could show you the continuance. I have 
it here. Tor the record, I am showing counsel the 
continuance filed on the 19th by the department. I filed 
the continuance at the department's request. 

fi Did Kellner tell you who at Justice called him? 

A Ko. Somehow or other, I think — the impression I 
got, it was Nark Richards. But I'm not really sure. 

I have a note here that on the 19th I met with 



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PAGE 32 



George Kyzinski. Going back to the 18th — on the 18th ue were 
supposed to meet with Mattes again and we had waiting at ray 
office DCDA's Kevin Cutxier, George Kyzinski and I believe 
Diaz' boss> one of the agents from SIS. 

Rather than going on recollection, let me read you 
portions of a letter that I wrote to Hattes that was never 
sent out. You will understand how this fits in in a moment. 

In the letter dated — that I wrote March 31, 1986, I referred 
back to the incidents of March 18. In summary. Mattes never 
showed up and the second paragraph reflects that '"On March 
18, 1 986 ' '--quoting directly from the letter — ''we were 
supposed to have met in my office at five p.m. You 
indicated to me earlier that day that you would attend this 
meeting. The purpose of this meeting was for you to discuss 
with us the names of other individuals who corroborate your 
client's story. However, at SMS p.m. you had still not 
shown up in my office. At that time I called you and you 
indicated to me that you were not free to reveal the names 
of the corroborative witnesses because an individual named 
Ron Rosenbllth, a staff member 4pfqB Senator John Kerry's 
oiilce, but It was Kerry's office who told you not to 
cooperate with the government. Your letter gives the 
inpzession that you had discussed this topic with me'' — for 
the record, the topic was the existence of corroborative 
witnesses — ''but that I have not taken affirmative action 



UNCLASSIFIED 



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ItUiSSIflED 



NAME: HIR120000 llSlUL.riW*" fm^w^ pjgj 33 

767 with respect to it. Obviously, this uas not the case 

768 because you refused to reveal the naiies oi the witnesses who 

769 can assist us in any investigation we may undertake.'' 

770 I also have a note made contemporaneous with my 
77 1 phone call to Mattes on the 18th. I have a note here, 

772 ''spoke with Mattes, told him not to talk.*' And he gave rae 

773 the name of Ron Rosenblith, the number 22>4-27>42, Senator 

774 John Kerry. 

775 MR. McGOUGH: Read that again. 

776 THE WITNESS: 22U-27t42. 

777 Things were starting to gat odd now. The day 

778 before Mattes told this reporter in Costa Rica we are 

779 getting ready to indict him and his wife. The next day I 

780 find out--I found out also he had been in Costa Rica with 

781 someone from Senator Kerry's office. I found out on the 

782 18th Senator Kerry's office is advising him not to cooperate 

783 with the department any longer. 

78U Ue then went ahead and — reading from my notes from 

785 March 18, I imagine while waiting for John to come we had a 

786 brief discussion. Me talked about^^^^^^^^^^^l, about the 

787 confidential informant Diaz had. a man m 

788 Th« notes reflect I spoke with Mattes. He was no longer^ 

789 cooperating. Then we wrote out a list of people who were 

790 targets. X need to be very careful with this, because there 
79 1 were many lists that were written out. At this point we are 





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iwssife 



PAGE 3U 



just dealing with various allegations and people who we 
should stay away from initially because of fears of 
immunizing or giving the appearance that they were 
cooperating, basically sticking with people who we felt were 
witnesses without problems. . Even--I look back on 
this and I see compared with what I have today that witness 
list was wrong. But, in any event, we wrote out a list of 
targets. Ue had Rene* Corbo, Frank Castro, Jose Marcos, 
Francisco Chinez, Rafael Torres Jimenez, Francisco 
Hernandez, Jose Hacias, Pedro Hill, Philepe Vidal, John 
Hull, Tom Posey, Jack Terrell, Bruce Jones, Sam Hall, Feko 
Rojas, Juan Perez Franco, Steven Carr, Robert Thompson, 
Peter Glibbery, John Davies, Claude Sheffard, Sandra Corbo, 
Alan Saum, Allen de la Halera and a man named Rica Bassas, B- 
A-S-S-A-S. I tell you at the time I had no idea who half 
these people were. There was another investigation going on 
into a bombing of the Continental Bank in Miami. George 
Kyzinski was involved in that case and during the course of 
that investigation he discovered that Renee Corbo and a 
bunch of these other Latin people may not have only been 
involved in the bombing but were involved in training people 
at the paramilitary camps and sending them down to Costa 
Riom. 

At this point I could see that the case was 
starting to broaden. He got--we were not only looking at 



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PAGE 35 



these allegations of assassination plot, but George was 
basically broadening the case by looking--bringing into this 
case the neutrality allegations that had been discovered in 
this prior investigation. 

So in all candor at this point I really had no idea 
where we were going. I just knew we had something . My 
basic approach is if you stick with it and pursue it, you 
will ultimately get an understanding of what is happening. 
Ue just started doing that. 

On the 18th we also drew up a list of witnesses. 
Daniel Vasquez, Senior, Daniel Vasquez, Jr., Ron Boy, the 
pilot of the Karch 6 flight, George Fradlan, Jaime Ortega, 
Beatrice Rodriguez, Hector Cornea, a maid at the Howard 
Johnson's Airway Hotel, custodian of records, Martha Honey, 
Tony Avirgon, John Mattes, John Maiestre, Jesus Garcia, Jack 
Terrell, Alan Saum, a man named Marceleno Rodriquez and a 
man named Jose Soaz. 

I can't underline that — the accuracy of these lists 
today obviously have very little bearing to what is going on 
today. I just want the record to reflect that. This is 
just notes we are making. 

BY MS. NAUGHTON: 
fi I understand. 

A Even after Mattes said to us that he wasn't 
cooperating, we were still going through and pursuing the 



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allegations his client was making and also beginning to look 
into the bioadet neutrality allegations. 

The continuance that was requested by Justice was 
actually filed on March 19. On the 19th I called Martha 
Honey, told her we were coning down on March 30 of '86, and 
she said she wanted her lawyer present but she will 
cooperate and put us in touch with other people in Costa 
Rica who have information and to call her back. I have a 
note I met with Kyzinski as wall on the 19th. 

Within the five days of the March 11 meeting, we 
had made plans, definitive plans, to go to Costa Rica and 
interview these mercenaries who at this time, based on my 
notes, I would say ware targets, subjects, whate-ver. They 
were all read their rights when we were down there. In my 
mind we were treating then as people who could be indicted 
because of their alleged participation in this assassination 
plot. 

BY MR. McGOUGH: 

e Let me back up. You said you told Martha Honey you 
were coming down. When? Hhen did you tell her? 

A I told her~ 

2 I believe you said on March 19 you told her you 
were coming down on-- 

A March 30. Let me take this out. 

I have a terrible habit of not only being redundant 



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but verbose. If I get to the point where it becomes 
intolerable, just let ma Know. 

Okay. On March 21 I have a note in my book, my 
date book, to make travel arrangements to go to Hew Orleans 
to interview Jack Terrell. Jack Terrell had previously 
given a statement to an FBI officer in New Orleans. He was 
someone that ue had known about. You could tell at this 
point there was a great deal of momentum. Made plans to go 
to Costa Rica. I would have gone sooner, but I didn't have 
an official government passport. I had to submit my 
paperwork. In the interim, we decided that we would go to 
Hew Orleans to interview Jack Terrell. I went with George 
Kyzinski. We took a statement from the Infamous Colonel El 
riAko. At that point the investigation again — I say changed. 

It didn't change. There was more stuff added to it. I 
came away--I went to interview Terrell because he allegedly 
had information about the assassination plot. When I spoke 
to him about the assassination plot, I found out the same 
thing that I found out from Garcia. Ultimately when I asked 
Terrell on March 27 where he had learned about the plot 
from, I will read you my notes. He told me that he had 
l*azned — ha learned about the alleged meeting where the 
assassination plot occurred, he learned about it from 
Philepe Vidal, Martha Honey, Peter Gllbbery and Robert 
Thompson. Thompson and Glibbery denied any involvement. 



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Ultimately later denied any involvement in the plot and 
we--there is physical evidence to corroborate that. Philepe 
Vidal we have not spoken to. Martha Honey, again, she was 
the common element. That was the same person Garcia had 
spoken to and it was the same person that Terrell had spoken 
to. What ue did come auay uith, Terrell, was a bigger 
picture of Tom Posey's involvement uith the FDK and CKA ' s 
attempts to put mercenaries into Costa Rica under the guise 
oi trainers, being trainers. In all candor, ior me to say 
anything more about that at this point I think would be 
overstepping the boundaries that I have been given. We are 
looking into those matters now. 
BY MS. HAUGHTOK: 

8 He don't want any post December >4th information. 

A Okay. 

e At this time let me back up to Posey a minute. Did 
you learn that Claude Sheffard was helping recruit 
mercenaries ? 

A Ko . What we learned was that--at the risk of 
breaking the rules a little here — I learned from Sheffard 
that he had come to the United States basically looking for 
MozK and he was friendly with a man named John Keyes in 
Massachusetts and that Keyes got in touch with Posey. I 
think there was an article--! think Sheffard told me there 
was an advertisement in some magazine, a military magazine. 



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Keyes was the one who got in touch with Posey. They 
arranged for Shefiard to go with the CKA to Honduras in 
November of 198>t. Then he was re-recruited by Posey in 
February to go back down to Costa Rica. 

In terms--to answer your question whether or not X 
have ever heard about Claude Sheffard recruiting other 
people, the answer to my best recollection is no. 

2 Okay. 

A When I came back from Kew Orleans, totally, totally 
psyched up about this case, the things that Terrell told me 
were exciting in and of themselves, but he not only — ha gave 
me more than words. He gave me newspaper articles that had 
been written about his exploits in Honduras, and he had 
given me some other corroborative information which led me 
to believe that what the man was saying was true. Terrell 
was no stellar individual. He had his problems in the past. 
Without — there would be a real question in my mind whether 
or not I would have believed him if he didn't have the 
materials. The materials he provided me spoke for 
themselves. It was obvious what he was telling ne with 
respect to his involvement in Honduras in November of 198U 
was true. So when I came back to Miami on the 26th. I would 
say that I came back believing that the bigger focus now was 
the paramilitary activities of the CHA and Terrell. Posey. 

ii Corbo. 



There was still the question about Rene^ 



He had been 



mussm 



69 



NAME: HIR120000 



mussw 



PAGE (40 



under surveillance which ultimately ended in failure. They 
never got anything out of it. There was still historical 
matter about the March 6 shipment that Corbo allegedly tooK 
down with Carr and Thompson. 

As far as the assassination plot was concerned, I 
think that started fading. It faded even more when I spoke 

to Terrell on the 27th by phone. He told me his 
information was hearsay. What happens, I got so caught up 
in the paramilitary plot he was talking about in Honduras I 
forgot to ask him the key question I wanted to ask him. 
That was how did you find out the information about the 
assassination plot. On the 27th I called him back and had 
an extensive conversation with him. I learned at that time 
it was just hearsay. He had no direct information. 



uNCussra 



70 



NAHE: 
956 
957 
958 
959 
960 
961 
962 
963 
964 
965 
966 
967 
968 
969 
970 
971 
972 
973 
9714 
975 
976 
977 
978 
979 
980 



HIR120000 



RPTS DINKEL 



DCHN OAKIELS 



WSMM 



PAGE m 



So I spoke with Leon on llazch 27th and we talked 
about appazently--ny recollection is we talked about my 
Terrell interview and--sent me to dEind out about an 
assassination plot. I didn't come back with much about 
that, but I came back with the paramilitary plot. 

Everything--things--I think — everything was 
convoluted. It was just a big mess. There were thousands 
of allegations flying around. He had begun shipments, an 
assassination plot on an ambassador, we had mercenaries in 
Honduras, and it was obvious that there was something going 
on> but it was — at that point, it seemed beyond 
comprehension . 

S Specifically, obviously Hall's farms in Costa Rica, 
the people you want to talk to in Costa Rica, was it your 
sense at this time that this paramilitary activity was 
active in Costa Rica or in — 

A Ko. It was obvious what we were looking at were 
people who were attempting to assist the contras, but there 
was — there were common threads through all this; but for the 
most part, when I got back from New Orleans. Instead of 
narrowing and clarifying what Z initially began with, it 
just became more confusing. And Leon was real confused as 
was I. Leon still — I would say at this point that his 



wussm 



71 



NAHE^ 

981 

982 

983 

9814 

985 

986 

987 

988 

989 

990 

991 

992 

993 

994 

995 

996 

997 

998 

999 

1000 

1001 

1002 

1003 

1004 

1005 



HIR120000 



UNCLASSIFIED 



PACK 42 



enthusiasm began to wane a little bit. 

1 recall that he was sort of questioning whether I should 
go to Costa Rica: and on the 28th> we had--my notebook 
reflects a meting that was six hours. I have really no 
recollection of what went on in that mating, but it 
ultimately ended with his advising me to go to Costa Rica. 

2 That is on the 28th? 
A That is on the 28th of March. 
8 You met six hours with the U.S. Attorney? 
A Yes . 

C You don't know what you discussed? 
A Ho . I wish I had taken notes. 
2 Yes. 
A Basically, what we--there weza many discussions. 

Many discussions that I have with Leon were impromptu. I 
know that is hard to believe, but I give you my word Z have 
no real independent recollection of what was discussed at 
that meeting other than to say that when I finished it, I 
was told to go to Costa Rica and interview these 
mercenaries . 

8 Has the discussion about this case? 

A Yes. 

8 It is not about soma other case? 

A No. Ko . Ho. It was clearly a discussion 
about--when you say this case now, you are not only talking 



yOCUSSlflED 



72 



KAHE: 

1006 
1007 
1008 
1009 
1010 
101 1 
1012 
1013 
101U 
1015 
1016 
1017 
1018 
1019 
1020 
1021 
1022 
1023 
102(4 
1025 
1026 
1027 
1028 
1029 
1030 



HXR120000 



UNCLASSIFIED 



PAGE U3 



about Garcia, you aze talking about Cozbo, Tezzeil. It was 
lik« just sitting at a table with several bright people 
trying to figure out what the hell is going on. No natter 
how hard I tried, there was never any real organization to 
it. 

When I--at some tine around the first of April, or 
even before, I started developing charts. 

For the record, I am showing counsel the charts 
that are under the portion of the notebook labeled 3/31/86. 
The first chart is narked January of 1985. 

I don't recall when these charts were prepared, but 
I found them in my notes. At least one of then was prepared 
before I went to Costa Rica, which was March 30. Around the 
time I had this meeting with Leon, I would say that sone of 
these charts were being prepared. 

Basically, the first chart shows Oliver North, 
National Security Council, Staff Intelligence Adviser, CIA; 
Rob Owens, State Departnent, sonething AID; John Hull. Fron 
Hull, I have two lines to Bruce Jones, Jin Denby . Then I 
have a line fron Hull to a line which ls--narked with our 
day, fine, the FDN, under that I have the Cuban allegiance. 
I t«nd to believe this first chart cane after I got back. 
It Is too conpleta. 

Q So it would be like late April? 

A I don't know. Ue are trying to nake sense of what 



IINClASSIflEO 



73 



HIR120000 



UHCIASSIFIED 



PAGE HH 



we had. I really--you Know, I sat here and tried to figure 
out how I even found out about Oliver North. Mattes was 
talking about Hoith. My earliest notes even showed a 
reference to North. 

But I really--this will become more significant when 
we get to the Costa Rican trip. I started in my own mind 
trying to put the whole picture into perspective. I would 
think that these charts, all three of them--one of them at 
least represents my understanding of what was happening. 

2 Do you recall when you first heard of Robert Owen? 

A Uell. it had to be early on. There is a reference 
in the FBI memo that I referred to earlier about Mattes 
mentioning something to the agents about Owen in February. 
That seems so far away, so removed from what wa were--what I 
was sent to look at. 

These things were floating around. Hhat I was 
trying to do, because Leon was--he insisted on having an 
understanding of what this was about. Ue need to know what 
this case is about. I don't know if you have ever been in a 
position where your boss tells you. ''Tell me what this case 
is about.*' and you really don't know what it is about. I 
did- ay very best to come up with a schematic, to explain the 
little bit that Z thought I understood about the events we 
were looking into. 

2 Hhat was your understanding of Robert Owen? Hhat 



UNCUSSIFIED 



74 



MAKE: 
1056 
1057 
1058 
1059 
1060 
1061 
1062 
1063 
10614 
1065 
1066 
1067 
1068 
1069 
1070 
1071 
1072 
1073 
107M 
1075 
1076 
1077 
1078 
1079 
1080 



HIR120000 



did he do? 



UHtlOTED 



PAGE M5 



A You know, I really at that time don't know. I just 
Knaw he was involved. Everybody was saying he was involved, 
nary Hats was telling me Oliver Horth was running a secret 
war irom the basement of the Hhite House. Do you believe 
that? 

e Did anyone tell you that about Mattes? 
A What is that? 

Did anyone tell you that about Mattes? 

X heard it from several sources. I just don't 



e 

A 

recall 



I knew these were just allegations. I had real — my 
impression now, my recollection is that just through the 
information we gathered, these names came up, I had nothing 
really behind the allegations. Just that people were saying 
they were involved. 

I think that much of this came from a Common Cause 
article that Jacquelyn Sharkey wrote during the fall of 
1985. There was refetance in there about John Hall and 
Peter Glibbery mentioned he was getting money — Peter Glibbery 
mentioned John Hall was getting money from the National 
Seouzlty Council. I saw that article way early on. That 
is, I think, primarily how I got the information. 

In fact, I think there was reference to Rob Owen in 
that article. It wasn't — the bottom line is that my 



UNCLASSIFIED 



75 



HIR120000 



UNPiSSffl 



PAGE U6 



recollection is that I didn't have any direct evidence that 
North and Owens and Hull uere doing A, B and C. It was just 
from the various things I was reading and iron the various 
conversations I was having with people, their names had come 
up. 

I can't tell you if any of these charts were 
discussed on the March 28th meeting with Leon. All I know 
is that we had a long meeting and I didn't know until the 
last minute whether or not I was going to Costa Rica. 
Ultimately, Leon decided to send me. 

THE WITNESS: Can we take a break? 

( Brief recess . ] 

BY HS. NAUGHTON: 
S Unless there is something else, can we take you to 
Costa Rica? 

A That is the next step. Okay, 
e Okay. 

A Let me put on the record, during the break, there 
were no of f-the-record conversations about any of the 
matters . 

Let me — before we move to Costa Rica, let me show 
yo« one last thing. Mattes was getting very ''hinkey*' 
rl«lkt before I left. 

From the 1th, the conversation where he said 
Senator Kerry advised him not to cooperate or his staff 



HNtmsw 



76 



NAME: 
1106 
1107 
1 108 
1 109 
1110 
1111 
1112 
1113 
1 1 14 
1 1 IS 
1116 
1 1 17 
1118 
1 1 19 
1 120 
1121 
1 122 
1 123 
1 UU 
1 125 
1126 
1 127 
1 128 
1129 
1 130 



HIR120000 



wmvm 



PAGE 147 



person, the remarks that Tony Avirgon aade to me; and 
finally, on the 28th, when I received this letter I am about 
to show you, something uas up. 

There is a very informal way of communicating with 
the Public Defender's Office. You rarely use letters, let 
alone certified letters. 

On the 28th, Harch 28th, I received, for the 
record, a letter dated March 27, signed by John Mattes. 
This later is odd, number one, because it uas certified 
mail, return receipt requested, and it is now--what is it, 
the 18th--almost nine days later, nine days after he advised 
me that he no longer was cooperating with the government, he 
sends me a letter begging for an informal, written 
cooperation agreement and the fact there were other people 
who wished to seek such an agreement with my office. 

That directly--this letter directly contradicted 
what he told me on the 18th. I wrote him a letter on March 
28. The letter I am showing counsel is dated March 31, but 
that was the date it was typed. 

On March 31, I was in Costa Rica. The day — the day 
Z l*it the office, March 28, I dictated this letter and it 
bAsieally reviews my train of thought and I think the train 
oi thought of the office at this point in the investigation. 

Really, I — I advised Mattes his letter suggests that 
we have expressed disinterest in the efforts or the 



UNCUSSIHE 



77 



HIR120000 



UNCLASSIREO 



PAGE HB 



corroborative work or evidence that he had gathered. That 
was obviously wrong, because he advised us that he was not 
going to give it to us. 

I advised him oi conversations that I had with a 
key witness in his client's case and reminded him as soon as 
I finished those conversations with the witness, I called 
him, John, and advised him what the witness told me and 
advised hin that, ''Since Sam was currently the focus oi 
your investigation, I feel — '• there is a blank, this letter 
was never retyped, never sent out — ''I feel it was incumbent 
upon me to reveal to you the substance of any conversation 
which I may have had with him.'* 

Above that, I say, ''I don't want to take the 
chance of withholding any material which you may deem to be 
Brady material. 

This letter was not sent out. Hhen I spoke with 
Dick Gregorie about it, who was the Chief Assistant, I spoke 
with him while I was in Costa Rica. He felt by answering 
the letter we were basically playing into his hand. This 
response never went out. 

In fact, I just found this letter, the March 31 
liH *T that I dictated to Mattes, I just found that in my 
cMfiin file on April 27 of 1987. It was incomplete. It had 
never been retyped. So that is why the blank is in there. 

Anyway, I leave for Costa Rica on Sunday, March 30. 



WIASSIFIED 



78 



KAHE: 

1 156 
1157 
1 158 
1 159 
1 160 
1161 
1 162 
1 163 
1 16t< 
1 165 
1166 
1 167 
1 168 
1 169 
1170 
1 171 
1 172 
1 173 
1 17U 
1 175 
1 176 
1 177 
1 178 
1 179 
1 180 



HIR120000 



HNtiAssro 



PAGE tt9 



March 31, we went to the embassy and the iiist people we 

spoke with were George Mitchell and Jim Kagel. Ilitchell is 

the security officer and Mitchell is an Assistant security 

officer . 

I have a note here that one of them advised me of 

the names of the people who are interested in our 

investigation. He also advised me that Ed Halsh, Voice of 

irKrt<W77 
America Security Officer, now John Hull. It says Hull is 

tight with President Reagan. 

At this point, when I left for Costa Rica, Hull was 
a name that was fixed in my mind. I think a lot had to do 
with the Common Cause article. 

Jacquelyn Sharkey interviewed the same people I was 
going down interviewing. It kept coming back to Hull, 
Hull's name kept coming up as an important figure. I 
advised him I was down there to speak with several people. 
One was John Hull. 

Actually, I was advised by Mitchell and Magel 
Ambassador Tambs wanted to speak with me and he is entitled 
to know everything I was doing. I was fighting with myself 
at that point because there were obviously high government 
ofAlolals Involved in the questions I was asking. I was 
gotog down there determined to find out if there was an 
assassination plot, but on top of it, I was determined to 
find out what the hell these guys were doing down there in 



UNCLASSIFIED 



79 



NAME: 
1 181 
1 182 
1 183 
1 18i< 
1 185 
1 186 
1 187 
1 188 
1 189 
1 190 
1191 
1 192 
1 193 
1 194 
1 195 
1 196 
1 197 
1 198 
1 199 
1200 
1201 
1202 
1203 
120U 
1205 



HIR120000 



UNWSSIFIED 



PAGE SO 



the first place and whether or not they were sent down there 
surreptitiousiy by any agency of the government. 

So I uanted--uent into Ambassador Tambs' office. I 
finally decided I was not going to withhold anything from 
him and I was going to tell him exactly what questions I was 
down here to have answered. I pulled out my little chart 
with Oliver North, Rob Owen, and John Hull. The ambassador 
turned white . 

S I guess. 

A The only thing he said when I pulled out the chart 
was, ' ' G e t ^^^^^^^H i n here.'* Those words are indelibly 
imprinted in my mind. 

2 

A Yes. ' ' Get^^^^^^^^l in here.*' In comesj 

tew that he was dealing with 
three people who had only seen the tip of an iceberg and was 
discouraging, I would say--not discouraging, but basically 
trying to rip the credibility of the various people who were 
making the allegations that we were exploring. 

I started taking notes. He got very upset. Not 
very upset. That is not fair. He just said, ''Don't take 
notas, don't take notes.'* 

fi Excuse me. Was it explained to youl 






I didn't even know what 



ICUSSW 



80 



NAME • 
1206 
1 207 
1208 
1209 
12 10 
12 11 
12 12 
12 13 
12 14 
12 IS 
12 16 
12 17 
12 18 
12 19 
1220 
122 1 
1222 
1223 
1224 
1225 
1226 
1227 
1 228 
1229 
1 230 



HIR120000 




)viously--when I left, you have to understand, 
when I left Costa Rica, I was going down to do what I 
normally do when the United States Government sends ne to 
travel; to go down, eat breakfast, stay m a jail for eight 
or nine hours, and visit with witnesses, get dinner, and 
that is It. You know. 

Then when Nagel told rae that--or Mitchell told me 
the ambassador wanted to see me, I was pretty impressed with 
that fact. 

When the ambassador said he wanted rae to speak with 

I sort of had an inkling who that was. 

Hher 




At that point, I felt that we had gotten a lot 
farther than I thought that we would ever get on this trip. 

So I went down and :ust went for it. You know. I 
started asking him questions and I later wrote a summary of 
my interview with him. 

I will show you this in a moment. 

Basically, he was introduced to me 
ll asked him what that meant. 

spoke to him. I have a note here ' ' Spoke with 
him with Ambassador Tambs present,'* and^^^^^^^^Btold me 





ONCUSSIFIEO 



81 



HAKE: HIR120000 
1231 
1232 



ONCLASSiRE 



PAGE 52 




UNClASSre 



82 



KAME: 

1233 
12314 
1235 
1236 
1237 
1238 
1239 
12140 

um 

12>42 
12U3 
121414 
12145 
12146 
121(7 
12148 
1249 
1250 
1251 
1252 
1253 
12514 
1255 
1256 
1257 




HIR120000 ^lil^ ^*°^ ^^ 

RPTS DOTSON "^ 

DCHN 6LASSKAP 
[ 1 1 =30 a.n. 1 

S Prior to the Boland Amendment? 

A Right. X will go on. He says Hull has not been 
involved in any military capacity either for the U.S. 
Government or the Contras movement since March of 19814, 
since Hull provides medical assistance to the Contras. He 
describes Hull as a patriotic American, says we should talk 
to Corbo, describes Corbo as a pain in the ass, says he is a 
renegade without any ties to — says Corbo present has 50 
people operating in Costa Rica out of Hull's Ranch. 
Requested we contact him if we taKe action against John 
Hull. Believes Martha Honey and Tony Avirgon tied into 
September murder. Avirgon are Sandinista agents or have 
ties to Sandinistas, something about tipping off with regard 
to travel. 

I also remembered him telling me that when I said 
John Hull, he said — when I talked about Oliver North, I said, 
••Do you know if John Hull knows Oliver Korth?'* And he 
says, 'Certainly'*, I could tell you — and I asked about Rob 
Owen, he said, '*! can tell you for a fact John Hull knows 
both Rob Owen and Oliver Korth.'' He cautions me, he said, 
''Do you know who Oliver North — let me tell you who Oliver 



IINCUSSIfi 



83 



ICliSSlflfO 



NAME: HIR120000 ^ M V*"* **^ ''^ " " ■"""■" pjoE St» 

1258 Koith IS. Oliver North is tha person who introduced ma to 

1259 tha President of the United States last weak.'' Ha 

1260 emphasized that Hull knew both Owen and knew North but was 

126 1 basically casting an eye on me for even questioning the 

1262 possible criminal involvement of these people in tha 

1263 activities that we were discussing. 

126U 2 Did you ask them if they were involved? 

1265 A Not really. This conversation just like totally 

1266 took me by surprise. I did not come down prepared to speak 
t o ^^^^^^^^^^^^^^^^^^^^^^^^^^^^H and, 

1268 I really didn't have the understanding I have now. I often 

1269 wish I did. It was a grand opportunity, investigative 

1270 opportunity, and you got to understand so«athing--you know, 

127 1 at the time I was 29, Assistant United States Attorney, I am 
1272 with an Ambassador of the United States andl 
1 27 3^^^^^^Hand I was concerned to even raise some of the 
127U questions here, because obviously I did not feal that 

1275 comfortable with the situation. 

1276 2 Sure. 

1277 A I didn't want to step on toes. 

1278 2 All you need is for Shultz to call youz boss. 

1279 A It was just, in retrospect, I thought I was 

1280 aggressive even asking the questions I asked, avan pulling 

1281 out the chart. But I would have been more aggressive. I 

1282 should have been more aggressive, because history has 



UNCUSSIREO 



84 



NAHE 
1283 
128U 
1285 
1286 
1287 
1288 
1289 
1290 
1291 
1292 
1293 
1294 
1295 
1296 
1297 
1298 
1299 
1300 
1301 
1302 
1303 
130(« 
1305 
1306 
1307 



HIR120000 



UNCUSSIFIE 



PAGE 55 



basically spokan. 

fi You wouldn't be here. 

A That is right, maybe. Who knows? But that was 
basically what I gathered. 

The whole tenoi of the meeting was weiid. The 
Ambassador was, I want to say smug, but he sat back, smoked 
his pipe, didn't say a word^l^et^^^^^^^^Hdo all the 
talking. It was so obvious^^^^^^^^Hwas seriously bothered 
by our presence there, and the fact I was even asking 
questions, and you will see later on it was--my impression 
was correct, and it was just like, let's hurry up, tell me 
what you want to know, and let's get out of here. That is 
what we did, spoke for a little bit. 

2 Has it your impression that Tambs had heard this 
all before, or did he interject with questions? 

A ny--what I remember about Tambs was I walked in, 
introduced myself, I said, ''Hr. Ambassador, we are here to 
have some questions answered, one of them is a plot against 
your life.'' He laughed. He thought that was a joke. I 
said, ' ' Ue are also here to pursue some other allegations, 
and I had a chart that can give you an idea of what the 
allegations are.'' I pulled o ut the chart, and he obviously 
beouie distressed, and he calledl 

[-the impression I had was that he was treating us 
like he had us on the tip of his finger, and we asked--the 



IINCUSSIHED 



85 



yitCUSSiFito 



NAME: 
1308 
1309 
1310 
1311 
1312 
1313 
131U 
131S 
1316 
1317 
1318 
1319 
1320 
1321 
1322 
1323 
132(4 
1325 
1326 
1327 
1328 
1329 
1330 
1331 
1332 



HIR120000 



PAGE 56 



agents said--two agents basically kept quiet, I did the 
qusstioning, and I remember he was basically giving ne some 
background, and I remember getting the guts up to ask him ii 
John Hull worked for the CIA, and he smiled. That is when 
he told me about this stuff prior to March of '8M. That was 
basically it. 

But I could tell when he left, he thought that he 
had--he was directing us, go after Corbo, leave these other 
people alone, and let me know what you are going to do with 
respect to Corbo, Chamorro, blah, blah, blah. So we went on 
our way, and the next couple days we spent at La Reforna. 

Q That is the jail? 

A Yes. We spoke with the mercenaries; and we wera 
not allowed out there without someone from the embassy 
accompanying us. Jim Nagel came out with us. We split into 
teams. Kevin Currier and I spoke with some, and Jin Nagel 
spoke with some, and we, all three of us, spoke with John 
Davies. I think that was the only Interview where someone 
from the embassy was not present with us. I had also spoken 
with Welsh, a security officer with the Voice of America; he 
told ne he knew John Hull, that he considered him a close 
frland, Hull and several others owned several ranches in 
Costa Rica. He had been to Hull's ranch numerous times. He 
believed Hull is a true American, hates Communists, said 
Hull has a radio and George Hltchell cleared this . 



UNCUSSIFIEO 



86 



BHClASSra 



NAME: HIR120000 ^^ ■ ■ w — - - - p^gj ^^ 

1333 Then he said Hull reports to someone in the 

133U embassy, but never saw evidence o£ military support of 

1335 Contras on his ranch. That was all on the 31. Then I think 

1336 from 4-1 to U-3--those were the days we did the intervieHS--on 

1337 >4-1, I got a phone call from John Hull requesting to speak 

1338 with me in San Jose on ■4-2# t-3. I said, ''Fine''. 

1339 And then on ^-2, we started getting--it got to a 
13t40 point down there where I wouldn't even speak in my hotel 
13141 room. I really didn't feel comfortable. X felt perhaps we 
13<42 were being watched. I really didn't know, but there were 
13>43 just certain, we were being treated like we were the enemy 
13Ut and we had no business being there, and it started really on 
1345 April 2 with Jim Nagel. Nagel made a comment to George 
13<46 Kyzinski which George reported to me on April 3. I wrote a 
1347 note on April 3 of the conversation I had with Kyzinski. He 
13U8 told him at LaReforma Nagel asked George how long Feldman 

1349 has been in the business and how long Kyzinski was in the 

1350 business. Kyzinski asked Kagel why he was asking. Hagel 

1351 said the U.S. Ambassador is the law, and we are here through 

1352 his graciousness , there are other agencies that had their 

1353 operational requirements, and we should not interfere with 
135>4 th* work of these agencies. That was the start. 

1355 Then on U-3, John Hull called me at 8:15. Ha was 

1356 supposed to meet me at 8=00 o'clock at Hotel te u gt iniv e ll e a . 

1357 I think it was down there. And he calls ma up, there was a 



muMW 



87 



HAKE: 
13S8 
1359 
1360 
1361 
1362 
1363 
1364 
1365 
1366 
1367 
1368 
1369 
1370 
137 1 
1372 
1373 
137U 
1375 
1376 
1377 
1378 
1379 
1380 
1381 
1382 



HIR120000 



UNCIASSIFIED 



PAGE 58 



different John Hull irore the man I had spoken with on the 
1st. 

2 What do you mean? 

A Hell, on April 1, he called ite . I had his home 
phone number. It is in the back of my book here. And I had 
left a message for him, and he called me back, and the man 
was really, he wanted to speak with us, and I began — this is 
the second big surprise. I didn't think we got a chance to 
speak with Hull when we got down there. 

Then on the 3rd, he doesn't call up and calls me 15 
minutes late and says that he, said on advice of counsel, he 
did not want to speak with he, he said, ''We are pissing off 
many people in the Costa Rican Government'*. He said ha 
thought we were here to take down Martha Honey and Tony 
Avirgon because of false representations about them, and he 
has learned differently. 

For the record, I an reading from my notes. He 
said he was a Costa Rican citizen, and I told him that we 
would interview him about Rene« Corbo. He said he couldn't 
say much about him, and, most importantly, he denied the 
U.S.- Embassy advised him not to speak with us. He denied 
thmt. 

fi Did you ask specifically about anyone at the 
embassy? 

A I just said, ''Did anyone at the U.S. Embassy 



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itos 

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PAGE 



59 



advise you not to speak with us?'' He said, ''No. I an a 
Costa Rican citizen, I have nothing to do with the U.S. 
Embassy . ' ' 

Hell, at that point we had nothing, no real reason 
to hang around the hotel, so we went oH to the embassy, and 
as we walked through the door, X saw Kirk Kotula. Mr. 
Kotula said ''Good morning,'' we said ''Good morning''. He 
said, ''By the way, John Hull came to see me yesterday'' — I 
am reading from my notes, which were written almost 
contemporaneous with these events. I wrote them shortly 
after this happened. 

Kotula said Hull came to see him yesterday, Hull 
advised him that he contacted us and wanted advice about our 
purpose, and Hull wanted to know whether he should talk with 
us. Kotula advised Hull not to speak with us without an 
attorney . 

At 9=15 — obviously, something was up because 40 
minutes before the witness told me he had little or nothing 
to do with the government, because he was Costa Rican, and 
he outright denied that he had any contact with these people 
at all and that he had received no advice regarding whether 
to apeak to us, and then Kotula is telling me 40 minutes 
later ha had advised Hull not to talk. I caught Hull in a 
dead lie. 

Then Nagel spoke to us at 9=15, and he said that 



iiniussim 



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mis 

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PAGE 60 



Mr. Hull had spoken to the Ambassador the day before and 
that he had also spoken with Kirk Kotula — ue saw Kotula, 
Kotula said> I advised him not to talk with us. Then I saw 
Nagel, and I found out not only did he say Kotula, but the 
Ambassador and Kotula advised Hull not to speak with us 
without counsel, and Hagel said Hull is a friend of Ronald 
Reagan, if you understand what I mean, Ronald Reagan knows 
who John Hull is, you know politicians. 

And then this was--on April 3 at 10=30 a.m., I spoke 
with Paul Fitzgerald. He was a nice gentleman, worked with 
Kotula. 

S Is that the embassy? 

A yes. He is Vice Consul. 

8 His name is? 

A Paul Fitzgerald. 

2 Since we weren't going back to La Reforma that day, 
I went over to the Consulate and pulled the files on Carr 
and Thompson. Fitzgerald was the one who was certifying 
them, and I have copies of the letters. 

As I was speaking to Fitzgerald, I asked if he saw 
John Hull recently. He said yes — I am reading from my notes-- 

fi Fitzgerald saw Hull? 

X Has in Kotula's office yesterday. Kirk told Hull 
had been contacted by the National Security Council and the 
Voice of America during our visit. 



UNCUSSinED 



90 



liNtussra 



'--.< . ./ 



MAKE: HIR120000 I ||llll_nU%/l 1 IW*^ PAGE 61 
1>433 2 Hull had been contacted? 
mSU A By the National Security Council and Voice o£ 

11435 America regarding our visit. 

11436 MK. nCGOUGH: Who told you that? 

11437 THE MITHESS: Fitzgerald. 

11438 It got to a point ^^^^^^^Hwouldn ' t say hello to 
1U39 us. We are Americans and members oi the American Government 
II414O doing investigative work, and I remember sitting in the 

mi4l restaurant at the hotel wondering whether or not there were 

II4142 people there watching us. That is the kind oi--that is how 

11)143 it got down there. We were made to feel very uncomfortable. 

II41414 and I remember the last day after all this happened, the 

II4145 Ambassador wanted to see us again on the 3rd, almost like a 

1t4i46 send-off. a fond farewell, and also to get a report from us 

114147 about what we discovered. 

IMMS I remember that I wanted to speak to the agents, 

IU149 and I was in Mitchell's office with Nagel, the three of us 

IMSO were there with Kagel, and I saw Nagel. He bothered me. he 

11451 really bothered me. He was like the House snitch in the 

11452 embassy. I remember Nagel followed us wherever we went, and 

11453 I said to Nagel, ''You stay here, we are going out there, we 
114514 are going to talk.'' 

I1455 Iha three of us went outside in the hallway and 

11(56 spoke, and then we were brought up to the Ambassador's 

II457 office, and I basically told him the people supposed to be 



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KAHE' 
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PAGE 62 



involved in the assassination plot dani«d involvement, and I 
didn't go into the substance of my conversations with the 
people, and that was basically it. I remember saying 
something about John Hull. 
BY ns . NAUGHTON: 

2 Did the Ambassador ask you what you had found out? 

A Ko, he did n't really a sk me much of anything. He 
was just listening .^^^^^^^^^Bwasn' t there, and he was very 
polite. I want the record to reflect he was never rude to 
us himself, but there was — between Hull's comments we were 
upsetting many people, and the way Hagel was always around 
and the little hints we were getting, it was apparent we 
were stirring up some problem. 

I don't know how significant this is, but I am just 
going to show you something here. Hhen the allegations, not 
allegations, but when my memo was leaked, somehow or another 
the Miami Herald and some other papers got a copy of the 
memo I wrote, and there was a reference to the treatment we 
had gotten in the embassy, and when the Herald saw the 
footnote about our treatment at the embassy, they called 
Kotula and asked if these events occurred, and he said, no, 
that I was lying, and that everything was like totally 
untrue. He said that he treated Hull just like he would 
treat any other American citizen. 

And that statement was remarkable in light of the 



m^^'SB 



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wmssiFe 



PAGE 63 



fact I found these letters in the file. The record should 
reflect Z am showing counsel a letter on John Hull. Clark's 
stationery/ dated November 5 of 1985. Let me just — certified 
correct by Paul Fitzgerald, Vice Consul of the United States 
of America/ a letter that was attached to this 
correspondence from Hull dated October 30/ '85/ to Mrs. 
Edward J. Carr and certification of that/ a letter sent from 
Stephen Carr to Kirk Kotula. an affidavit dated March 9 of 
'86/ signed by Peter Glibbery. that was in one of the fileS/ 
and an affidavit signed by Carr, dated March 9/ a note: 
''Kerry Christmas/ John/ Pete is still being hard headed/ I 
have chosen my course as of today. Why don't you take a 
look at that? You might find some significance in those.'* 
The most outrageous thing is in one of the letters 
Hull was requesting visa favors for one of his buddies/ and 
Kotula had the nerve to tell the press YtftttJr was just another 
American citizen living in Costa Rica. 

e The letters from Steve Carr. were these after his 
incarceration? 

A Yes. There is a whole other side to this. Honey 
and Avirgon are chasing the story about La Panka--! don't 
knoM if you are familiar with that. 

Q No. 

A La Panka was at the Pastora jungle camp. I think 
on March 20/ 1984/ Pastora called a press conference in the 



llHtmSW 



93 



UNtussra ., 



HIR120000 IIIVllI Hlltlll IL.U PAGE 6>4 
jungle. They invited a bunch of journalists. Someone set 
o£i a bomb. Three journalists were killed and several 
maimed, one o± them Tony Avirgon. 

From that point, they set off on a hunt for the 
killers. Somehow or another. Honey and Avirgon were able to 
link Hull to La Panka, and they sued Hull in Costa Rica, and 
Hull was afraid of Carr, Glibbery and the rest of them 
because, without going into what we discovered, the 
allegations were that Hull had recruited or was taking part 
in the recruitment of mercenaries down there and were using 
Carr and Glibbery and these other people to establish that 
Hull was working on behalf of the United States to bring 
mercenaries to fight the contras. 

And I guess they were using that to corroborate 
Hull's involvement with the CIA. She was trying to prove La 
Panka was a CIA plotter, or whatever. There was a fierce 
battle between Hull, Honey and Avirgon with respect to 
Glibbery and the rest of them. Carr and Glibbery and the 
rest of them believed that Hull was the key to freedom and 
that if they supported Hull, this is initially, they 
wouldn't have a problem. They trusted Hull would get them 
out. 

When Hull didn't get them out, Carr started making 
statements to the press, and he basically gave, took the 
position that Hull was the CIA operative. And apparently 



WSMB 



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Stephen realized he had made a nistake in doing that, and 
just referring to the letter, dated February 12, here you 
can see that--it uas used by journalists and nada an 
error--what is that? 

All of the manipulations came from extreme leftist 
organizations. It's the course I want to take. Because I 
can't take any, can't take back my previous mistakes. Kirk 
Kotula was obviously involved in trying to get Carr and the 
rest of these people to recant their statements regarding 
Hull's involvement with the CIA and with any other American 
agency, and he knew about it, and apparently Hull and Kotula 
had corresponded about it, because the letter, dated April 
1, April 1 of '86, Hull writes Kotula encloses a letter from 
Robert Thompson, testimony from Carr that might help us 
rattle Martha Honey's cage. 

I guess the whole point--you need to have that 
background to understand some of the references that were 
being made in the correspondence. 

8 The Honey suit had already been filed, right? 

A Right. But it had still not been tried. 

e Was that in the U.S. Courts? 

A No, no. The Daniels-Sheehan suit was not filed 
until Hay 30. The suit in Costa Rica was pending and was 
tried, I believe, in July, or June. 

Q Uas Robert Owen a named defendant in either of 



UNCLASSIFIED 



95 



HIR120000 
them? 






PAGE 66 



A I bslieve he is named in the Honey suit in the 
Southern District of Florida. 

So that basically ends the trip to Costa Rica. 
What I wanted to mention, going back just for a second, even 
after Mattes advised us that he wasn't going to cooperate 
with us. I continued to cooperate with him and pass 
information on to him, and there was--on 3-28-86, I spoke 
with John Mattes. I was advised — I called him to tell him 
about a conversation that I had with Alan Saum, but he was 
not in the office. 

Also, on 3-26-86. I spoke with Saum and again 
advised Mattes. There was a third conversation.' which we 
will get to in a few moments, where Mattes was on the phone, 
and we spoke with Saum. I just wanted to put that in here 
because I have it in the chronology. He came back, I came 
back from Costa Rica, once again totally, totally thrilled 
with what I had discovered. I had no definitive proof that 
North and Owen and all these people were involved, but I 
just knew that there was something, something was going on 
based on the way we were treated. 

X had also learned about the recruitment of 
■•zeenaries in Miami. Stephen Carx admitted he had been 
recruited in Miami. 

2 What did Carr and Gllbbery tell you, if anything. 



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PAGE 67 



about how iai up this went? Did they mention North, did 
they iiention-- 

A The narae , Korth. never came up. He heard Owen's 
name and just that he was down there, and it was just like, 
there was always something mysterious about that, because 
everyone always talked about the Korth-Owen connection. But 
all I ever was able to prove, or, you know, able to find out 
in Costa Rica about North and Owen is that Owen had come 
down to visit John Hull sometime in late February or Early 
March--no, late March, early April. That was it, that he was 
down there . 

Quite irankly .^^^^^^^^Hhad already confirmed to 
us Hull and Owen knew each other. But, basically, what we 
did find out was that Renec Corbo was involved, that he had 
recruited mercenaries., they had flown the guns down on March 
6. although Hull admitted he had never seen the guns, he 
only saw the boxes, and that Ccrbo told him there were guns 
in the boxes. But he had never seen the guns themselves in 
Fort Lauderdale, which was a direct contradiction of what he 
had told someone from the Miami Herald in July, '85. 

But, you know, there was also allegations about 




UNCLASSIFIED 



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HAMK 
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So it was very exciting. 

Again, ue came back, and it was adding raoie and 
more a lleqat:^ons to this already coniused mess that we had. 

But, again, it was--we Knew something 
was there, I knew something was there. It just needed to 
be. It needed to be investigated, but there was really no 
overall understanding of what we have, just a bunch oi 
different allegations which appeared to be true. 

So I came back, and on the >4th of April, I met with 
Leon. It was the day I got back from Costa Rica. I 
remember Ana Barnett, I remember Larry Sharf being there, I 
don't remember if Dick Gregory was there or not, and Leon 
was there. I went through the chart that I had shown to the 
Ambassador, and that was the first time we talked about the 
Boland amendment. And that became a topic of conversation. 

I remember asking questions, raising issues ^ Is 
there a criminal violation attached to violating an 
appropriations bill, was there a criminal section affixed to 
the Boland amendment, what is the Boland amendment? Just a 
lot of questions being raised. 

When then asked, wa started looking for the Boland 

amendment, couldn't find it. He asked David ^a moft t to pull 

A 



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16^6 

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UNCUSSIFIEU 



PAGE 69 



a copy of the Boland anendment off tha nachlna. and David 
cana in three quarters of the way through our conversation 
and brought in the Boland amendment. I still have the 
copies he pulled for us. And we talked, and we came away 
irom that meeting with the understanding that--we still 
didn't understand what we had, and I want you to write a 
memo . 

Forgive me for being presumptuous ior a moment, 
according to the papers, it was at this meeting that Leon 
Kellner told me to slow down or go very slow. I don't 
recall any conversation, except for one, which I will tell 
you about, which occurred later on in the stinmer, I don't 
recall any conversation where Leon Kellner ever told ■• to 
slow down. Because, quite frankly, I wouldn't be part of 
it. 

Z left that meeting on the Uth of April with an 
order I was to write a memo so that they could sit down and 
study what we had, and that was it. Leon — again, Leon's 
emphasis was assassination plot and guns. He didn't express 
a great deal of interest in a neutrality violation. 

And when I sat down and told him, I remember when I 
told him what Carr had said, Carr had not even seen the 
guns, and all of them denied being involved in an 
assassination plot, it was almost as if, as far as they were 
concerned, the major allegations of the case had been 



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KANE 

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disproven, and it is not like htt wasn't disinterested in the 
test oi it, but the things that were aost important to hin, 
as iar as he was concerned, had no basis, in fact. 

So he wanted a memo, and that's what I basically 
started doing. So from that point on, I worked on the memo, 
and I had also — before I left for Costa Rica, I knew I had to 
come back and prepare for a fraud trial, which I had 
anticipated was going to take about six weeks to try. When 
I was down in Costa Rica, I told the agents there was going 
to be somewhat of a delay when I got back because I had to 
start preparing this thing, it was a monster. 

And I guess from — I guess from M-7 until May 2, what 
I did--90 percent of the time was work on the boiler room--I 
also worked on the memo. I have a note here on (4-11-86 
Leon--Leon, Larry Sharf, Ana, I believe Dick was there, and 
myself met in Leon's office. That was the day of the FBI 
shooting . 

2 Hasn't that the 1st? 

A No, I think it was the 11th. It was a Priday. I 
will tell you in a second. April 11 was the date of the 
shooting. That was the day Bryant and Robert Perry released 
an article, the first real article, about the investigation. 
And I don't know why we met on the llth, but all I remember 
is I said to Ana Barnett, I remember telling them, and I 
felt foolish for saying it, but I remember thinking to 



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PAGE 71 



myself that this case was basically fraught with potential 
problens. and I felt that there was a need to be concerned 
about appearances, especially because Leon's Presidential 
appointment had not come through at that point. 

I remember talking to Ana about that, saying that 
Leon has not been appointed, blah, blah, blah, and I 
remember Ana and I spoke to Leon. He came back on the 11th. 

Vie had said to him that, just kiddingly, nothing real 
serious and facetious, we brought up the question about his 
appointment and just the other political concerns, and — I 
should be careful when I say that. I guess the easiest way 
of saying this is that it was a hot potato, this case was a 
hot potato. Leon looked me straight in the face, and ha 
said, ''Politics are not for me to consider, the only thing 
that I need to consider is the evidence and the law, and I 
am not interested in politics.*' He was very sincere about 
that. That stayed very much in my mind, because I later 
came back to it in another conversation that I had with him 
in August, which I will get to. That was really the last 
big meeting I had with Leon, in April. 

I have several references about getting notes from 
Kevin Currier. Also, I got an interesting letter from 
Mattes during april. He once--once again, Garcia' s 
sentencing date was postponed, and he gave the reason Garcia 
is cooperating with the government. I don't know where he 



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PAGE 72 



had gotten that izom, because he indicated to us on the 18th 
that he was not. But he also — 

8 Let me back up foz one second. 

A Yes. 

S This conversation with — had he already spoken to 
Leon? 

A Yes. He didn't coite down until the next day. 

S This conversation you had with him is beiore the 
Attorney General comes down? 

A You had better ask Leon that. I wasn't at the 
meeting with the Attorney General. Hy understanding is, and 
what Leon has told me since, is that the meeting, I think, 
occurred in the lobby oi the Baptist Hospital. 

Q But the conversation you had with him was the day 
of the shooting? 

A To the best of my recollection. 

I am showing counsel Mattes' letter, dated April 1(4 
of '86. This is a letter I received from Mattes regarding 
my cooperation I extended to him. And the reason, you know, 
I don't mean to stress my, overly stress my relationship 
with Mattes, but the way I perceived this is that Mattes has 
aoeused me of obstructing his investigation into events that 
Leon said to have slowed down through the direction of the 
Attorney General, and, quite frankly, I feel that his 
allegations diminish my credibility because if you believe 



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1733 
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173S 
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what he said to the papers, ultimately, it would make me 
look as if I were some kind of co-conspixatoi in this. 

The bottom line is if I did anything with Mattes, 
it was I tried to assist him, even after he attempted to cut 
his aid off from us. 



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DCMN GLASSNA 



*i^«to 



PAGE 74 



2 Did he still represent Garcia at this point? 

A Only ior a few more ueeks . I uould note during the 
period of tine between March 14 and May 22, which was the 
day he was terminated, he never once brought to the court's 
attention any oi the so-called improprieties that I or the 
agents had committed. And, in fact, he never brought to the 
attention oi Garcia's counsel, and in the Garcia brief just 
recently filed, there is no allegation of government 
misconduct. The only person who brought the so-called 
improprieties--the only person that he raised these 
improprieties to was Senator Kerry. 

So on April 17, 1986, Mattes once again moved for a 
continuance. The significance of that is that Mattes* line 
now is that he was going to bring to light the North network 
and my role in it and my attempts to obstruct his 
investigation on March 19, but that Justice had moved to 
continue that sentencing here, and as a result, his 
opportunity to make the world aware of Oliver North and Jeff 
Feldman's attempt to impede the investigation was taken away 
froB him. But here he is, on April 17, once again moving 
for a defense continuance of the sentanclng. 

S Let me stop you. 



mmm 



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8 After the Attorney General's visit> did Leon 
discuss with you any discussions he had had with the 
Attorney General? 

A Mo. Ho, not that I recall. The Attorney--! knew 
that Leon was having periodic contact with Kark Richard, but 
as far as Mr. Jensen or Mr. Reese, no. 

MR. nCGOUGH: When you say periodic contact, with 
regard to this investigation or in general? 

THE HITNESS: No, I think it was with regard to 
this investigation. That name was always around for sone 
reason. 

Then I got this--this was interesting — you know, I am 
just basically giving it to you as Z understand it. So if I 
am going off track stop me. 

On April 11 — wait, not April 11 — on April 21, I 
received this letter from Stephen Carr, and again for the 
record, I am showing counsel the letter dated April 11, 1986 
from Stephen Carr, care of Kotula, U.S. Embassy. And Carr 
is basically begging for an opportunity to cooperate with us 
so he can get out of jail, and he mentioned Pete Glibbery 
himself had received a letter from Mattes, dated Harch 27, 
saying Rosenblitt and others are ''working to secure a safe 
r*'feuxn to the U.S.'' 

And then he attached, Carr attached a letter that 
he had received from Peter Glibbery, and in that letter. 



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HIR120000 ■^ • ■ w»«« i^^^^ii ■h.Br# PAGE 76 
again I an showing it to counsal at this point, Glibbary 
tails Catz, ''Today raceived a letter izom J. Mattes, dated 
nazch 27,'' says that he has tzied to phone us, but couldn't 
get through. 

Then there is a reference to Ramirez, who Mattes 
had allegedly spoken to on several occasions. Mattes in his 
letter to Glibbery said RR and others are working to secure 
a safe return to the USA and that Mattes sent — what do the 
initials PLO stand for? ''Push Leon Overboard''. And 
Mattes goes on to say he will keep in touch with us very 
shortly and is thanking him for their help. 

BY MS. NAUGHTON: 
S Hhat is the PLO reference to? 

A I don't know. I found that vary, vary bizarre. 
Push Leon Overboard. It may be Klinghoffar. 

MR. MCG0U6H: That was a joke circulating at the 
time about Leon Klinghoffer. 

THE HITKKSS: At the sane tine, it nay be a 
reference to Leon Kellner. I don't know. It was--apparantly 
by this point ha was in vary daap with Senator Kerry and his 
people. Tha rest of it is just, you know, the FBI — Glibbery 
said tha PBI had been to see hin, tha PBI agent had been a 
gantlanan, just sone general connents . 

Okay, the next significant event was on April 28, I 
submitted ny first draft of tha nano to Leon. To make it 



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real simple, Leon didn't liKe it. It wasn't detailed 
enough. So I went back and drew up--and the reason it wasn't 
detailed enough/ I was working my hind o±i on the boiler 
room. When the boiler room finally got continued, I had 
time to re-write the-- 

BY HS . NAUGHTOH: 

2 Your first draft, did it contain any 
recommendations for future action or course of action? 

A Yes. I got the recommendation right here. It 
wasn't as specific. I said although — this is the 
conclusion-- •' Although our investigation has dispelled 
Garcia's story, we have learned CHE actively assisted FDK in 
Honduras, Costa Rica between Kovember, '8H and April, '85. 
There is no question Renee Corbo and CHE actively recruited 
individuals in the United States to train and/or fight with 
the FDK and contras ; further investigation may also verify 
Carr's claim the weapons were among the items shipped from 
the United States to Salvador.'* 

So it was basically the concept of doing further 
investigation. Leon wanted more. So I went ahead — by the 
way, let me move ahead, I have on April 25 in my book, I had 
nottts meeting with Kellner for both U-ZH and U-25 of '86, 
and apparently I met with Leon on >4-25-86. But I don't have 
any notes of my meetings. I kept no notes, to my regret, of 
my meetings with Leon. I went ahead, I imagine the '♦-25-86 



ICliSSlflEO 



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was . the meating that we had to discuss this nemo. Because 
that was the first meeting that I had with him after I 
submitted the memo to him. 

Q You said the memo was ^-28? 

A Then no way. I don't know. 

S You don't have any independent recollection of what 
those meetings were? 

A No, I have no independent recollection. There was 
another meeting I had with Leorion 5-5-86, and that must have 
been the meeting we talked about the memo. But I don't 
remember the it-25 meeting. There were a series of impromptu 
meetings that X had, and there was always discussion about 
the case, and for the most part they were always' redundant. 
just what do we got here, that type of conversation. 

So we had--apparently on the 5th, we had a meeting 
about the memo, and I re-drafted it, and I have the word 
''processing logs'' here. The memo, which was basically a 
new draft of the memo, was finished at t|--I am sorry, 6 = 45 
p.m. on the mth of Hay. And on May 1>t, I met with Kevin 
Currier, and we went over it line by line, the memo, and at 
that time we both concluded that we ought to go forward with 
a grand jury Investigation. And that was not the first time 
Z had stated that, because the March 1M meeting with Hattes 
I told Mattes I was hoping to Impanel a grand jury. 

But for the benefit of everyone here, I will read 



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the last paragraph iron page 20 of the 5-14 draft, the first 
draft: ''The FBI requests we begin a grand jury 
investigation into the activity described in this neao . The 
Bureau believes a grant jury is necessary for several 
reasons. First, it would dispel clalits the Departnent of 
Justice has not aggressively pursued this matter; second, a 
grand jury would ellnlnate some of the deception the FBI 
believes they have encountered during their Interviews with 
Daniel Vesco. Ronald Boyd and Max Vargos . The grand jury 
would give the Department of Justice access to gun records 
and bank records. Canex was the fund-raising organization 
set up to raise funds. I concluded we have sufficient 
evidence to begin a grand jury Investigation. I believe a 
grand jury investigation would ultinately reveal gun running 
activity, including gun running and neutrality violations. 
Due to the political nature of this case, I an not sure such 
violations could be successfully prosecuted in South 
Florida. ' ' 

We are going to find criminal activity. I don't 
think we are going to win this case in South Florida. Leon 
liked this neno. He sent it back, and he hlnself concurred 
that we have sufficient evidence — he crossed out ny whole 
reoonnendatlon here. For the record, he scribbled out the 
last paragraph, and he inserted, ''I concur, we have 
sufficient evidence to institute a grand jury investigation 



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PAGE 80 



into the activities described herein.*' 

But he himself sometine before May 20, which is the 
day we formally discussed this memo, he himself concurred a 
grand jury uas in order. Okay? 

2 Let me ask you this. Is it standard to write such 
a memo before you go to a grand jury for subpoenas? 

A When you don't understand the case, I imagine that 
you do. This wasn't a--this was just a summary of what we 
had developed at this point. In terms of whether it is 
standard or not, you are going to have to ask Hr . Kellner. 
I just do what I am told. 

You know, Leon did not--Leon did not have a 
comprehensive understanding of what I was chasing with the 
agents, and he wanted something to read, and I gave it to 
him, and that was it. 

8 Here is what I am getting at. 

A Go ahead. 

2 Even in the initial work you do on the 
investigation, it is clear you need some records. Hhat I 
don't understand is why can't you just issue a grand jury 
subpoena for the records from the beginning? 

A I wanted to do that. I had no problem. To me, the 
gxuid jury is a very, very important tool, but Leon, you got 
to know Leon. Granted, you know, in light of everything 
that is going on now, there is an appearance because he did 



UNCLASSIFIED 



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not. go to the grand jury he was involved in sone attempt to 
slow it down. That is certainly an appearance that has to 
be acknowledged. 

But I am telling you that Leon Kellner, the only 
concern that he had on the 20th when we discussed this nemo# 
was that the reputations oi , you know, important people in 
the community almost, I would say in the Latin Community 
especially, were not going to be dragged down because of 
inferences that can be drawn from issuing subpoenas to these 
people. He wanted to know more about what we had--I am 
jumping ahead — let me step back, and I think we can put this 
in order. I got this draft back, I gave it to him on May 
15, I got it back sometime before the 20th. I went ahead 
and had another draft typed up with his conclusion. 

And when we went into the meeting on May 20, Leon 
and I were both going into the meeting believing a grand 
jury was in order. I said Leon and I, because Leon himself 
had written at that point the last paragraph in the memo. 
So when we went in, it was — you know. Larry Sharf had been 
given a copy of the memo, and I believe Ana Barnett had been 
given a copy. Everybody read it. Ue went over it 
critically, and they got to the point where they asked me, 
''Hhy do you need the grand jury?*' 

And I basically told them, ''I need the grand jury 
to weed out deception, I need the grand jury to get records. 



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it's just a tool> it's just one tool I need to get the 
investigation started.'' 

And I think'-let ite make this real clear. Ho natter 
what reason I gave. Larry Shari especially had a reason why 
I was wrong. And he did it--Larry Sharf is a very cynical 
individual, very bright, and I-- 

S What is his position? 

A He is, I think, special counsel? 

2 So he came in with Kellner? 

A Yes . He has known Leon ior ages . They have been 
friends for ages. That is Larry's job in the office. If I 
had to describe his job, Larry is there to pull from any set 
of facts any problem that could possibly arise. He is ''Dr. 
Doom' ' is what I call him. He basically felt that we did 
not have enough at that point to go to the grand jury, and 
Dick Gregorie felt the same. 

Now, iarry Sharf was the recipient of one of the 
Attorney General's awards. He got it for his involvement in 
the ABSCAH investigation, and Dick Gzegozia was the man who 
investigated the Headle Cartel. He prosecuted the case 
involving Bazzy Seal, both men had a gzeat deal more 
eNfttzlence than I did. And even though I felt differently 
than they did — and I think what I was more concerned about at 
that point was the appearance, let alone the need for the 
grand jury to do the investigation, I still nevertheless 



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miAssw ... 



HIR120000 limill Mlltlll IImW page 83 
followed their recommendation, and their recommendation at 
that point was do some more background work, and then come 
back and we'll talk about issuing subpoenas. 

I think the heart of their concern was that if we 
went to the grand jury at this point, we were taking the 
chance of putting people in there that you really don't have 
an understanding of specifically what their true involvement 
was, and if you get down to questions of immunity, you may 
end up immunizing people who are, who shouldn't be 
immunized. And all that was said to me at the Hay 20th 
meeting was just do some more background work and come back 
in a few weeks, and we'll talk about this again. 

I said fine. And I knew the agents would be 
horribly upset because I started Hay 14 talking about a 
grand jury, and we did this memo, and it was supposed to be 
the last hurdle. I came out of the meeting saying, we got 
to do some more background work. 
Let me just-- 

e Hera is what I don't understand. What is so magic 
about doing grand jury work? Why is that such a big step? 
All it is is you send out some subpoenas and you — 

A Is it really? I don't perceive it that way. 
B*e«use when you take people into the grand jury, you have 
to advise them of their status, number one. you got to give 
them their rights, and you got to make a determination what 



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to do in the event that a witness takes the Fifth, whether 
or not at that point, you compel them or whether or not you 
just leave them alone. 

And without knowing in advance what the 
individual's role is, or having a better understanding what 
the role is, then you are operating from a position oi 
weakness. And although at the time I felt that I had 
sufficient information, you know, to go forward, I wasn't 
quite frankly worried about that, they ware. And they were 
my supervisors, and they felt I needed more information, and 
that was it. 

The only regret that I have is that I didn't stick 
with my conclusion. Leon asked me to change the conclusion 
on the memo, and I did. That was just it. But if you ask 
me, as the prosecutor of the case sitting there, whether or 
not the three of them had pre-planned this conclusion, the 
answer is no. Because there was a serious intellectual 
analytical discussion of each of the points that I raised, 
and they came up with good reasons why I was disheartened. 
You know, I wanted to get this thing moving, but they said, 
''Do some more work,'* and that's where we left it. 

S When you talk about impaneling a grand jury-- 

A It wasn't impaneling. 

fi You don't mean literally? 

A Ho. 



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NAME: 
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2om 

2015 
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e There is already a grand jury sitting? 
A Right. I went ahead--sonetime between, before the 
nay 20 meeting I got letters iron Garcia complaining about 
the attorney and all this other stuii. On the 20th, we had 
the meeting, and this is the draft of the meeting, the memo 
that was used at the meeting. 

For the record, X am showing counsel the memo, 
dated 5-20, in the top right-hand corner, and it is labeled 
''Final Draft with Sharf and Kellner's Suggestions.'* 

MR. nCGOUGH: Whose handwriting is that? 

THE WITNESS: nine. This is mine too. Everything 
up here is mine. The black marks are yellow marker. If you 
guys want a better copy, I will get you a better copy. The 
key thing here, the substance of the memo stayed the same. 
The only thing that really changed was the conclusion. I 
came in to the nay 20 meeting, I concluded we have 
sufficient evidence to institute a grand jury investigation 
into the activities described herein. 

That paragraph, or that sentence was changed at the 
end of the nay 20 meeting to read ''I conclude that we have 
sufficient evidence to continue the investigation into the 
aetivlties described herein. At present it would be 
premature to take this matter to the grand jury, some 
background work still needs to be finished. Upon completion 
of this work, I believe a grand jury investigation may be in 



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The only thing that I agreed to do at the end o£ 
this May 2 meeting was to do some more background work> and 
Leon was adamant, that's when he talked about destroying 
reputations by sending out subpoenas, and he really 
impressed me as being very concerned that the process was 
used legitimately. 

Granted, you know, there was a question, I 
questioned in my own mind at that point whether or not there 
was some fishy business going on, but I had no reason to, it 
was because of what was being suggested at that point. 
There were articles in the Kew York Times. I would be lying 
if I told you I didn't think about it. 



UNCLASSIHED 



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2051 
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RPT3 DINKEL 
DCHN SIABKE 



UNCLASSIFIED 



In all candor. I didn't balieve it, but tha 
conversation was serious and X just want ahead, like I said, 
and decided he wants a little more background, do more 
background. No probleit. 

BY ns. NAUGHTON: 

e Was that your last draft? 

A No. I took this draft and resubnitted it for 
typing. I have the word processing log on 5/22. It looks 
like at 1=30 p.m.. I got it back at 2=15 p.m. on 5/22. This 
was my final draft. Again I am showing Counsel the draft 
labeled 5/22. That is in the upper right-hand corner. 

On this draft. I just put in what I had written 
at the end of the 5/20 memo. This is the draft X sent to 
Leon, the final draft. I didn't sign off. put my signature 
to any of them. I don't know why. I did it. That was it. 

e Is there a — is that the last draft? 

A No. I submit this to Leon and I make plans to 
carry on with the investigation. In the interim. John 
Hattes has been removed from the case and on Hay 22. Judge 
Soxantlno appointed the attorney to represent Garcia. On 
Hay 27. I had a meeting with Currier and Kyzinski. Again, 
the purpose for this meeting was to do — lay out a strategy to 



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get the background wotk done that Leon wanted done. 

I have here, I am showing you my notes from May 
27, ''establish gun running strategy,'' get] 

Who gave the guns, who arranged the 
shipment, who flew the shipment.'' This was an analysis of 
what we had accomplished to date on the March 6 gun 
shipment . 

I would say at this point the assassination plot, 
for the reasons I state in the nemo, basically was 
discounted. What we are really looking at now was the gun 
shipment and the neutrality violation that Corbo was 
involved in and perhaps CHA was involved In. 

I then wrote down a list of people who we should 
interview, also other tasks, have to identify Corbo's 
Salvadoran weapon. Contact Costa Rican associates. Then 
the same thing with respect to the June 13 shipment. I had 
a list of who we should speak to. 

e Okay. 

A I wrote down a list of people that — of interviews 
we have completed up to this point. I made notes that we 
had iJitariews from the bombing case that I needed to look at 
and the physical evidence that was gathered to date. 

So, basically, on nay 27th, I sat down with the 
agents and we decided who we were going to interview and it 
was from these interviews I was going to make — reprint my 



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recommendation ue go to the grand jury. 

The interviews began very shortly. Really, I was 
lucky to have two very dedicated agents, KMzamski and 
Currier. They are about as fine agents as you are going to 
find. They went right out and started interviewing people. 

2 Did they, to your knowledge, write any internal 
status reports on it? 

A On the investigation? 

fi Yes. 

A I really don't know. I am sure they did. I got 
a whole bunch of stuff from Customs in New Orleans. I found 
teletypes the FBI disseminated to Customs in there. There 
was a teletype regarding the Garcia interview. I know that 
on March 13, of 1986, Kevin Currier brought — wrote a 302 
to--or--what do you call that? The teletypes? 
MR. FLYNN: Airtels . 

THE HITNESS: Wrote an airtel to the Bureau of 
Headquarters regarding Hattes' relationship with Tony 
Avirgon. The reason that occurred, I think, is because 
Currier and Glibbery rewrote letters to the embassy about 
Avlzgon authozizlng immunity to them. I think that is how 
that oaae up. Look, I am sure that they did. I really 
don't know. Z didn't see much of that. 
BY ns. NAUGHTON> 
fi You never saw their brown case file? 



Mmsm 



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A Their brown case iile is 15 volumes. It is 
nassive. The answer to your question is, no. I had my own 
strategy. Ue were just taking it through. I trusted them. 
I still do. There were times over the course of the 
investigation that I didn't. That was stupid on my part, 
but you know, I trusted them, dearly. 

2 But did they ever--do you know whether or not 
they ever on their updates or anythlMn) else express their 
dissatisfaction with not going forward? 

A They didn't have to express it. They expressed 
it to me. Kevin Currier, personally. Currier was adamant. 
U.S. --to this date. Currier will tall you there was soma 
impropriety. I think that is what ha truly believes. But 
there wasn't. It is just that is it. You know, I can't 
look into my boss' mind. I don't know what he does when I 
am not in his office, but as his employee, you know, I have 
no reason to state this, because I have no long-term plans 
to stay with the Department. 

As his employee, he is quite frankly as fine a boss 
as a person can have, because the man is accessible, he 
listens. He is not condescending at all. I think he is 
truly committed to using the system in an ethical manner. X 
think what happened as a result of inaction, for vary 
innocent reasons, he has created appearances of impropriety. 
You have to deal with them. I have never seen — except for 



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one tine, on August 29, which I will tell, but, outside of 
that one conversation I had with him, he nevex gave me any 
reason to believe that there was something going on. 

Q Did Currier ever give you any reason to believe 
it? 

A You have to know Kevin. Hell, they were gung-ho. 
Their investigation always continued. It never really 
stopped. That investigation had been going on as far as I 
was concerned ior years. The Cuervo end oi it, they knew 
about as early as 1985. George interviewed Tom Posey on 
January 5 of 1985. 

e What I am getting at, did either Currier or 
George ever mention their superiors received a call from 
anyone in high places or put — they had experienced any 
pressure through the FBI to slow down on the investigation? 

A I don't recall — I don't recall any conversation 
where they said they got pressure from above. Kevin was 
putting pressure on. You know, Kevin really wanted the 
grand jury. Remember, they always threatened to take it 
above Kellner's head and take it to headquarters, that kind 
oi stuff. Do what you want, Kevin. 

S Okay . 

A So we met on the 27th. He talked. At that 
point, around the 27th, the first week of June, I ended up 
getting a case which required my having to travel to 



UNCUSSIFIEO 



in 



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Thailand. Of course. I uas greatly distressed by this--it 
was a great case, a heroin case. That kept ne busy really 
iron the first of June right through the beginning of 
August. I tried two cases back to back. That Sodo Kyosa 
case, the ton of cocaine, went to trial right after the Thai 
case. The Thai case took the better part of the nonth. 

Q You went to Thailand June 1 through when? 

A No. This is--I picked up — I have a note here I 
began working on the Thai case June 5 of 1986. Between the 
27th, Kay 27th and June 5th, I have a notation on the 28th, 
met with Currier and Kiszynski. On the 22nd, I called- 
Currier and asked him to check items seized from Jose 
Kuteen's shop in Miami. 

On June 2, X have the word processing log where 
Larry Sharf resubmitted my memo for corrections. Larry had 
made changes without my permission to the memo. That was 
the final draft that was sent. 

The changes are really for the most part 
insignificant. Ha changed the tone. In the final draft, 
which is dated again Hay 1 M , but which was sent out on June 
3rd, Larry had added-- 

C Hait. Sent out on June 3rd? 

A Right. 

2 You told me June 2 is what he changed? 

A June 2nd is when Shazf resubmitted my final draft 



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oi the meno to typing. He added ceztain provisions. I can 
go through then if you want point by point exactly what he 
changed . 

2 Okay. 

A Starting with page 8 of the drait narked 6/3/86, 
on the top oi page 8, in ny final draft, I referred to 
nartha Honey as a Costa Rican journalist. In Larry-Larry 
referred to her as a journalist. He took out the reference 
to her being a Costa Rican journalist. 

He added the footnote 7, which concerns the 
filing of a civil conplaint by Hartha Honey on Hay 30,- 1986. 

MR. HcGOUGH: Footnote 7? 

THE HITHESS! Right. 

HR. ncGOUGH:what does that deal with? 

THE HITNESS: Martha Honey's lawsuit in Miani. 

BY MS. NAUGHTON: 
2 That is why you have the difference in the date 
between the date on the neno and the footnote you are 
talking about? 

A Right. On page 12 of the final draft, there is a 
discussion about John Hull. In ny final draft, I referred 
to John Hull as an Anarican citizen residing in Costa Rica. 
Lazzy Sharf referred to hln as an Anerican who resides in 
Costa Rica. Larry also addded footnote 8 in the final draft 
which is--Hull told ne in a telephone conversation that he is 



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now a Costa Rican citizen. Th« United States Embassy, 
whoever docunents Hull as an American citizen. I didn't put 
that in. That istiue. 

Then finally, a big change was in the conclusion, 
ny final conclusion was what I had previoymy stated, in 
summary we have sufficient evidence to continue the 
investigation, it may be premature to take this matter to a 
grand jury, background work still needs to be done. Upon 
completion, the grand jury investigation may be in order. 
That is how I ended it. 

Larry ended with the following: ''I conclude 
that we have sufficient evidence to continue the 
investigation into the activities described herein. At 
present, it would be premature to take this matter to a 
grand jury absent further field investigation. A grand jury 
investigation at this point would represent a fishing 
expedition with little prospect that it would bear fruit. 
Ue are not now in posession of facts which might enable us 
to confront those witnesses whom the Bureau believes have 
been deceptive. Further background investigation and 
interviews may uncover such information. The grand jury is 
not needed for access to Costa gun shop records since ATF 
has the right to inspect. 

''Canek Bank records were desired to identify 
Corbo's associates. This appears to be an unnecessary and 



UNEUlSSffl 



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undesirable step at this time. Many Cozbo associates 
already have been identified and further interviews can 
identify others who might be relevant to this investigation. 

The banX records on the other hand would likely yield a 
list of innocent contributors to Canek who have no knowledge 
of or active participation in the activities alleged. 
Moreover > the usual delays in obtaining and analyzing bank 
records can be expected. I have discussed the matter with 
FBI agents and they have agreed to defer the background work 
at this time. Upon completion of these steps, the grand 
jury investigation may be in order.'* 

The only thing I resent regarding my supervisor's 
handling of the whole case thus far is this, because I 
didn't write this. I'm eating this now. This Is not — 

e 

S Some of those rasons are pretty pathetic. 
A 

A The fact that--personally , the whole idea of the 
investigation was to identify Corbo's associates and I never 
found that unnecessary and undesirable. Now some of the 
language in here is reaching. But It in part reflects some 
of the things that we talked about at the Hay 20 meeting, 
but I don't remember anyone — and I certainly did not say that 
It was undeslreable to Identify Corbo's associates nor did I 
balleve that it was undeslreable to subpoena bank records, 
because there may be a delay in getting them. But this is 
what went out. I never saw it before It went out. It was 



UNCUSSIFIED 



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PAGE 96 



just sent out on June 3rd uith a cover letter. 

MR. HcGOUGH: you never saw it before it went 



out? 



Richard? 



THE HITKESS: I didn't see it before it went out. 

BY nS. NAUGHTOH: 

When you say went out, to where did it go? 

nark Richard. 

MR. McGOUGH: Hera you copied on the letter to 



THE HITHESS: No. Leon called me down after it 
was sent out and gave me a copy. 

MR. ncGOUGH: How long after that? 
THE WITNESS: The next day. 
BY nS. NAUGHTON: 
2 Did you read the conclusion when I gave it to 



you? 



A Yes. 

fi Did you express your dismay? 

A For what purpose? Really, at that point there 
was no sense in saying anything. I had no control over it 
any more. If they didn't see fit to let me look at my own 
maao before it was sent out, I had no business expressing 
anything. I have to work there. The thing is it was an 
internal memorandum as far as I knew. I had no idea it 
would ever be disseminated publicly. Certainly if I had 



UNCLASSIFIED 



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PAGE 97 



known someone uas going to leak it, there would have been a 
major protest. 

2 Why don't we get to that as long as you brought 
it up. As far as I know — correct me if I am wrong — the first 
people who get it is the Washington Times, is that right ? 

A I don't know. 

& As far as the first leak? 

A I don't know. Do you know where the postmark was 
from on the envelope? 

2 Ho . He have not subpoenaed the press. I heard 

r 

the fist leak was to the Washington Times. 

A 

A That would be — 

2 Obviously when the story breaks or someone you 
know has your memo, you know if you read it in the Miami 
Herald, or Time magazine. 

A I knew, only a couple of days ago, a week ago, I 
just heard from Leon that the memo had been mailed en masse 
to a number of papers and television stations around the 
country. You know. That was it. Z thought it was bad 
because there were references to people who put their 
reputations and lives on the line by talking to us . There 
were references to them in the memo. I felt that whoever 
leaked it should — showed disregard for the safety of those 
people. There was nothing that could be done at the time. 

2 So Leon told you it was to several papers 



ilNMSm 



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throughout the country? 

A Right. Ky understanding was that he had iirst 
gotten called about that irom Justice. 

2 About the leaks? 

A Ho. Yes. About the leaks of the memo. I think 
it was Mark Richard again. I am not sure. I really don't 
know. 

2 Do you now whether or not the memo was 
accompanied by any statement or any — 

A Yes, this letter. Enclosed is a detailed 
memorandum reflecting the investigative steps undertaken in 
connection with this investigation. footnote 7 on page 8 
reference is made to civil lawsuit instituted by Martha 
Honey and her husband Tony Avirgon. I sent you a copy of 
the complaint last week. I will keep you informed about the 
status of the investigation. Very truly yours. 

2 Uas the United States a named defendant in the 
Honey suit? 

A Ho. 

2 It is in state court in Florida? 

A Ho. United States District Court, because it is 
a suit involving parties from more than one state. 

2 I guess you misunderstood my previous question. 
When the newspapers received your memo, do you know whether 
or not or did Leon tell you whether or not any other 



U1USSIFI[D 



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HIR120000 



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PAGE 99 



NAME 

2351 mateiial was contained in it ? 

2352 A Contained in what? Contained in the-- 

2353 2 The envelope with youi memo? In other words, a 
23514 note as to what this was, what to do with it? 

2355 A Ho. Ho. 

2356 S Do you have any ideas as to who leaked it? 

2357 A You are asking ne to speculate. That is not iair. 

2358 I'm not going to be part of any witch hunt. I have a 

2359 belief, but I am not going to state it. I have no evidence 

2360 to support it. Whoever did it is a fool. Because it 

236 1 compromised the investigation. Certainly it didn't 

2362 encourage people to participate when their security can't b* 

2363 guaranteed, and I think it demeans the Departmeirt and th« 
236>t system overall when the security of witnesses is compzomised 

2365 like this. 

2366 2 Did you give copies of it to anyone else other 

2367 than-- 

2368 A Ko . Look, I think that the memo was stolen out 

2369 of my cabinet. I think it was stolen a while back. A 

2370 footnote that I--the original footnote about John Hull and 

237 1 ^^^^H^^^^^^Hwas on a piece of yellow paper that was my 

2372 rough draft file. One day--the week after everything came 

2373 to light about David tswsn, for soma reason or another, that 
237M piece of paper shows up under my door. I had not seen that 
2375 piece of paper in months. 



UNCLASSIFIED 



129 



HIR120000 



UNCLASSIRED 



PAGE 100 



. . 8 The last tine you saw It was in your iile 
cabinet? 

A It was in ny filing cabinet. I walked into my 
oiiice--! have the date, I don't have it hexe though. I 
don't have the book. It was recently, only about three or 
four weeks ago. It was laying under the door. Just totally 
shocked ne because the only way that someone was going to 
get that was not even a copy. That was the original. It 
was to have gone into my filing cabinet and taken out. 

2 It was just an insert? 

A Not an insert. It was a piece of eight by 
fourteen paper. It was the most sensitive footnote in the 
entire memorandum. The footnote suggested that Hull was an 
operative for the CIA. That was the essence of it. The 
lack of cooperation we had at the end was — but-- 

2 Is that in your file? 

A What's that? 

Q That. 

A Yes. Sure. 

2 Is your file cabinet locked? 

A It wasn't. Neither was my door. Hy office is in 
a sacure area. You really--all you are locking your door 
froB are your colleagues. I wasn't cynical enough. 

2 Why don't we go on in your chronology. I 
think--you are in Thailand. You come back. 



wussife 



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ONCUSSIFIED 



PAGE 101 



A Again uoxk on the Thai casa June 5th. I have a 
notation on June 10 oi 1986, met with Kellnex regarding 
Mattes, Garcia, and destruction letter. I knew you would 
like that. The destruction letter was a letter dealing with 
destruction of drugs, where he has to sign the drug 
destruction letters. I had a drug destruction letter. I 
went looking for it the other day. Instead of finding the 
drug destruction letter, I found the letter I wrote to 
Mattes. That's how I found it. 

I had no idea why at this point I was still 
talking to Kellner about Mattes and Garcia. I tend to 
believe it was because everything was still hanging in the 
air, he had still not been sentenced. A final decision had 
to be nade about a cooperation agreement. At this point, 
though, it was just senseless. It was obvious that John had 
gotten his way with Senator Kerry and at this point Garcia 
and Mattes were no longer even in an attorney-client 
relationship. He had been terminated on Hay 22. I am only 
guessing. I really have no idea. 

2 He was terminated because his client wanted that, 
right? 

A Yes. 

fi 7he(^]j was no other Independent — 

A No. I have the letters if you want to see them. 
He just basically felt Mattes was in a conspiracy with me. 



ONCUSSinED 



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HIRUOOOO 



UNCUSSIFIED 



PAGE 102 



Iionically Mattes is still visiting Garcia. I went through 
the attorney log book at the prison last week. As I went 
through it, I noticed John--I think as late as last September 
and October was still visiting him. 

X have no recollection really of the June 10. 
Even if there was a meeting on that date, I just had a 
notation I was supposed to meet with him. 

June 20, I left for Thailand. June 28, I 
returned from Thailand. July 7, X began the Thai case. 
July 25, X ended the Thai case. July 30. X began the Soto 
case . 

2 What were the dates? 

A July 30 began the Soto case. August 1, X ended 
the Soto case. X was really out of pocket from the 
beginning of June all the way through August 1 of '86. 

Then 10 August I get back to the thick of things. 
On August--July 31, X received an FBX PROS memo. X never 
asked for the FBX PROS memo. THWaj is on July 31. Kevin 
prepared it. X only recently found out why he prepared it. 
He was basically looking for a way to pressure Leon into 
making a decision. 

There wasn't much X could do on the case after 
JuB* 1 because X was tied up on the Thai case . The Thai 
case was given to me because the man who was handling it 
before ended up taking over the niami River Cops 



iinmim 



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UNCUSSIFIED 



PAGE 103 



investigation. They needed someone who could get the case 
togthar quickly and try it. it was a great opportunity. A 
nice trip to Thailand. I took advantage of a good thing 
when I saw it. I MfW* oH on that. 

As a result, nothing much got done on the--on this 
case, the contra case until 8/8. Hot 8/8, until 8/14 of 
'86. 

8/14, I gave Leon the PROS memo, the FBI PROS 
memo. I gave it to him on August 8 of '86 which is the day 
he left for vacation. I finished reading the FBI PROS memo 
on August 12 of '86. I felt that it was clearly sufficient 
evidence at this t...me to go forward. Cerbo had been 
interviewed. He himself admitted there were weapons on the 
March 6 shipment. There were a lot of other interviews that 
were done. I felt that at this point, we had enough to go 
forward . 

I felt that way actually back in Hay. but I felt 
we had gotten Leon what he wanted. 

I was told not to do--when I gave Leon the PROS 


memo, my recollectin is I was told not to do anything until 

he had read It. I didn't. The only thing I did was meet 

with George and Kevin on August 14. It's back to the same 

thing. Z have the New Orleans connection which was Jack 

Terrell at THA . The paramaters of the investigation* 

September '84 through April 15. Members of the conspiracy. 



UNCussm 



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NAME: 
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auso 

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UNCUSSIRED 



PAGE 10U 



the targets, further investigation that needed to be done. 
Than I have a sequence of events that I went through. We 
did this at lunch, at a lunch meeting. At this point, it 
was just ny way of getting back into the case and trying to 
sort of regroup because I had been in trial or preparing for 
trial since the beginning of the sunner. 

August didn't pan out too well. Leon had still 
not given ne an answer and, too, ny son was sick and was put 
in the hospital. There were sone personal problems. But to 
say that the agents were persistent would be an 
understatement. Kevin especially. He wanted to know--! 
kept going down to Leon. I really thought I was losing 
credibility with Leon because I was nagging him to make a 
decision or let me know one way or the other. He kept 
telling me that he had to read the memo. That was it. 

On August 29, that was the only time Leon ever 
gave me a reason to believe there was wrongdoing. Before X 
get to that, let me just catch up here. On 8/18> I began 
working Operation Texas full-time, which is a marijuana 
conspiracy case. 8/20 I had my only conversation with 
people at Justice. Tht was Joe Tafe, who was in charge of 
nautxallty violations. He gave me hints. On 8/25, I began 
O^xation Blackjack which was a Migerian heroin conspiracy. 
I had other things going. On 8/29, I went down. This is 
like the fourth time maybe--! don't remember the number of 



ICLASSIFIEO 



134 



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wussra 



PAGE 105 



times — I went — had been down to see Leon a nunber of tines. I 
said, look, I have to know. They want to know. They have 
been waiting. They are being persistent. He told ne at 
that point sit on the case until he gets back from 
Washington, D.C. Politics are involved. I said to him, 
Leon, that really upset me because he told me on April 11, 
during the day of the FBI shooting that politics were not a 
consideration. I said to you, why are you telling me 
politics are involved when you told me politics aren't a 
factor for you to consider. 

He said to me that politics aren't a factor for 
you to consider but they are a factor for me to consider. 
That is what he said. He subsequently — I confronted him with 
that at a later point. He explained to me what he meant by 
that. He didn't deny--he has never denied that he said that 
to me . 

MR. FLYNK: What was the date of that? 

THE WITNESS: August 29. 

He told me that he has received a series of 
affidavits from John Hull regarding the Avirgon/Honey 
lawsuit. Again it was John Hull manipulating people. There 
were affidavits from the various mercenaries. He was hoping 
Leon would use these affidavits — it showed complete ignorance 
on his part about how the system operates and even what the 
United States Government role was in that lawsuit. Kut I 



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UNCLASSIFIE 



PA6E 106 



did not see these affidavits at this time. He showed then 
to ae subsequent to the tine he got back from D.C. He was 
apparently concerned that the office was being manipulated 
to take a position on the lawsuit oz even to take a position 
with respect to the investigation that we were conducting. 
That's what he basically told me. 
BY ns. NAUGHTOH: 

2 Has the U.S. a party to that lawsuit? 

A No. 

e Why — why the affidavits? 

A Why is Hull doing that? 

2 I can understand Hull doing it for purpose of the 
criminal investigation. If the U.S. isn't a party to the 
civil, why would that be a concern for the U.S. Attorney? 



UNCLASSIFIED 



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2540 

asm 

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RPXS DINKIL 



DCnX DANIELS 



UNCUSSIFIED 



PAGE 107 



A Exactly. That is the question I think he was 
asking hinself. He felt that he was being asked in a vexy 
subtle way to manipulate something he had no role in. I 
felt that--expressed to me his concern that the office was 
not only--was being manipulated. 

He were being used for selfish interests, interests 
that may even have ties back to Washington. Ha just didn't 
know. He did the smart thing. He took the affidavits to 
Washington and brought them to Mark Richards and showed them 
to him. This is all what I learned later. 

In the meantime, I. didn't know any of this. The 
only thing I remember was my boss telling me, ''Sit on the 
investigations; politics are involved.'' 

I immediately reported that to my father-in-law, 
who is a lawyer and former judge down in Miami, because I 
anticipated that this day would come and I wanted a witness. 
I didn't want to be left in a position of making an 
uncorroborated statement about the conversation that I had 
with my boss. 

But being the gentleman that he is, he never — to 
this day, he has not denied it. He hasn't denied he said 
that politics were involved. He has explained that to me. 
2 So Kellner gets the affidavits pursuant to the 



UNCUSSIFIED 



137 



HIR120000 



itussra 



PAGE 108 



civil litigation, the Honey suit? 

A That is what he told me? 

S But he goes to see Mark Richards? 

A He got the affidavits. There was a letter to Leon 
and a letter to Uarren Rudnan. Copies were sent to Leon. 
Sone affidavits fron some of the mercenaries; and he went to 
Washington with the affidavits and he came back. I don't 
remember when he gave me the affidavits. He did. He gave 
me some memoranda on the Neutrality Act, asked me to read 
them. It was back to the same status, just waiting for him 
to finish reading the memo. 

In all candor, at this point, after August 29, I 
thought the case was dead. I really did. The case just sat 
in a box on my table. I was busy. I was a narcotics 
prosecutor . 

e How long was Kellner gone? 

A Two days, but he never got back in touch with me. 
I didn't say a word. The only person I reported it to was 
my father-in-law so I had a witness. That was it. 

8 Did the FBI keep bugging you at this point? 
.A X don't think that accurately describes their 
vlfor . 

e 

A 



But that continued? 

Sure. Sure, and I am just going on preparing my 



cases, getting ready for trial. Finally thinking that there 



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PAGE 109 



uas a decision made by indecision, and I was at that point 
prepared not to hear anything else about this case ever 
again. 

I just thought that it uas put out to pasture. 

MR. FLYNN: Did bureau headquarters ever contact 
DOJ about the case? 

THE WITNESS: I don't know. I don't know. That 
was my ieeiing. I had no idea what was going on in the 
background. I had no idea Leon has given the memo that the 
FBI wrote to Dick Gregoria. That was the only copy that 
they had. That doesn't necessarily iorgive them ior not 
making additional copies. What ha did was sent the letter I 
gave him to Dick, asked Dick to read it, make a - 
recommendation . 

Dick sent the memo back to Leon. I imagine Leon 
ultimately read it and then around the iirst week of 
November, I got a memo from Leon authorizing me to go to the 
grand jury. 

.> Before I get to that, let me just fill in the gap 
here. 8/1>i, I met with George and Kevin. 8/18, I began 
working the marijuana case. Operation Texas. 8/20, I spoke 
with Joe Taf e . 8/25 began Operation Blackjack. 8/29 
" " ^ told me to sit on it. 9/10/86, sit on the 



investigation. 

9/10/86 began Operation Lawman, which was a large 



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HIR120000 III vU|.riwV>* •"■"^ PAGE 110 
cocaine and ciack distribution ring in th« black community 
in niami. 9/15/86S, Garcia sentencad . 10/9/86, I hava a 
notation I met with Kyzinski and Currier. I hava a note, 
''Call Steve Mitchell re: Posey investigation in Kew 
Orleans . ' ' 

What this suggests to me is I was still keeping my 
iingers in it even though there wasn't much being done. 
10/30/86, I met with Ralph Martin and Marshall 
Jarrett irom the Department of Justice Public Integrity 
Section . 

Sometime around the first week in November, I 
received authorization to go to the grand jury. I did not 
tell you when I got the memo I didn't know what was going 
on. I was pleased, but-- 
BY MS. KAUGHTON: 

2 He have to back up. Jarrett and Ralph Martin — in 
the meantime, Hasenius' airplane goes down. Your office is 
investigating it, apparently. 

A The Hasenfus incident? 

S Yes. 

A I knew Customs was. I didn't know my office was. 

S Didn't that ring any bells? Didn't you run down to 
sea If there was any connection with — 

A Why? As far as I was concerned, I was told that he 
would get back to me . I was told to — he gave me the 



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PAGE 1 1 1 



affidavits, ha gave me the memoranda. That was the only 
thing ha did when he came back from Washington. He told me > 
you know. I will get back to you after I read the memo. 
That was it. 

I bugged him numerous times and this was nothing to 
be gained at this point because the last word I had was not 
do anything until he told me. 

As far as I was concerned, the Hasenfus incident 
really wasn't any great revelation because it was apparent 
at that time that there was much more to this whole network 
than Reneif Corbo. I am not saying this network is 
necessarily involved with the investigation we are doing> 
but if for some reason the motivating factor was going to be 
that the United States Government may be exposed or Oliver 
North's network may be exposed, as far as I was concerned, 
that had already been done. It is just that it hadn't 
received the public attention that the Hasenfus crash 
brought out. 

2 After the Hasenfus crash, did you receive or become 
aware of the inquiry the Department put out to all U.S. 
Attorneys Offices for any information? 

A Right. The memo from Chuck Saphos? 

Q Yes. 

A Yes. 

C Did you respond to that? 



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A No, I didn't. That wasn't really ny place to. I 
had seen it. I think Ana Baxnett was doing that. I 
ramenbet talking about it. ChuckWj^ used to be at our 
office. But, no. 

e Do you know whether any of your superiors sent the 
synopsis of your investigation to Justice? 

A Sure it did. It is right there. June 3, the cover 
letter to Hark Richards. They had it. 

S But they didn't make a separate response to the 
teletype? 

A I really don't know. I didn't. 

2 Not to your knowledge? 

A No. That is not a fair answer. I don't know. I 
just really don't know. 

S So when Marshall Jarratt and Hartin cane down, did 
they have the June 3 memo? 

A You know, I remember speaking with then. It was 
late in the afternoon. I remember going through the file 
with them and basically detailing what the case was about, 
ny recollection is a pretty expensive overview of the case. 
I was told to speak with them. I did. I don't remember 
Buoh about it. 

B Do you remember them asking you if Leon has asked 
you to slow the case down? You remember Jarrett asking you 
that? 



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A I don't know. If he did ask me that. I know what 
thA answer would be. Just the August 29 incident. That was 
it. 

2 Were they taking notes when you talked to then? 

A Ho. ny recollection is that they cane in--see> I an 
getting--! spoke with Rob Lyons and soneone else iron the 
ethics section, the Office of Professional Responsibility. 
I am getting-- 

Q Has that during the sane period of tine? 

A Ho. That was later on. I have notes of that. 
Hold on a second. 

I spoke with — 

2 Jarrett and Martin are there to try to decide if 
the Independent Counsel should be brought in to investigate 
the contra natter? 

A Yes. 

2 Does that refresh your recollection? 

A Yes. I renenber that. I renenber then talking 
about that. I have a note on 10/26 Z spoke with hin fron 
Justice about this case. I have their cards. That is it. 
That was it. Then you can see that this was the — these are 
the oonplete notes I had of the conversation. I put a 
conplete set of ny notes back here. But — no. 

2 Okay. Then we go to Hovenber 1st. You get sone 
sort of neno or letter fron Leon authorizing the grand jury 



MlMSim 



143 



HIR120000 



ONCUSSIFIEO 



PAGE im 



A Right. This letter. Right here. 

This nemo was by Dick Giegorie to Leon on around 
October 6. I didn't get this back until the first week or 
second week in November. I don't remember the exact date. 

S I concur in recommendation, prepare the necessary 
documentation to-- 

A Let ' s see . 

2 --get approval? 

A Yes. Any necessary grand jury you may deem 
necessary. Keep me up to date on the developments. That 
was it. I set up my iirst grand jury appointment ior 
11/18/86. That was my first day in the grand jury. 

e Did you ask Leon if this was dated Octaber 6 hoM 
come you never saw it until November? 

A Yes. Any necessary grand jury you may deem 
necessary. Keep me up to date on the development. That was 
it. I set up my first grand jury appointment for 11/18/86. 
That was my first day in the grand jury. 

2 Did you ask Leon if this was dated October 6 how 
come you never saw it until November? 

A Yes. He told me. 

e Hhy? 

A He said when the Hasenfus crash occurred, he felt 
there was ''really something there.'' He decided to go with 
it. 




144 



NAME: 

2740 
27m 
27M2 
2743 
2744 
2745 
2746 
2747 
2748 
2749 
2750 
2751 
2752 
2753 
2754 
2755 
2756 
2757 
2758 
2759 
2760 
2761 
2762 
2763 
2764 



HIR120000 



WSSIfitO 



PAGE 115 



2 Uhy didn't he tell you? 

A I only work fox the man. You Know. 

Q Did you ask? 

A No. Why would I want to? Why make trouble? X 
finally had what I wanted. What difference did it make at 
that point? The appearance has been created. 

C Did you talk to Mr. Gregorie to see if he had 
received this memo on October 6? 

A No. That he had wrote--had written the memo on 
October 6 . 

2 Oh. That he had written the memo? 

A Leon got the report on August 8. Ha gave it to 
Dick sometime after August 8. Dick wrote the memo back on 
October 6. Leon gave me the recommendation on 
November--sometime between November 1st and November 11. 
Somewhere in there. 

In the spirit of candor, the most surprising thing 
about this memo is that I had been given carte blanche, to go 
on the grand jury. One oi the reasons that was given to me 
back on May 20 was that he wanted to make sure that the 
grand jury process wasn't being abused and that he wanted to 
make sure that peoples' reputations wouldn't suffer by the 
issuance of subpoenas . 

Then here--you know, I had gotten--my recollection is 
he told me he wanted to approve the subpoenas that had gone 



IJNCLASSIHEO 



145 



NAME: 
2765 
2766 
2767 
2768 
2769 
2770 
2771 
2772 
2773 
2774 
2775 
2776 
2777 
2778 
2779 
2780 
2781 
2782 
2783 
2784 
2785 
2786 
2787 
2788 
2789 




HIR120000 ijl^llUriUUII 1*^V PA<:E 116 
out.. Here X had been given carte blancta which I welcomed 
quite frankly. I ieel that I have sufficient experience to 
judge when to bring one to the grand jury and what necessary 
prep work needs to be done before you make that move. 

I didn't object to it. I just thought that that 
was backing off from his original position. 

How--the background, the prosecutive report 
contained the interviews that were done after the May 20 
meeting. He may have felt that we had enough to go forward 
without his having to discuss this once again. There was no 
meeting. 

One day I went to my boK. The memo was there. 
That was it. 

2 when you got it, was this written on it? 
A Just like that. That is it. That is what I found 
in my box. 

2 So you never discussed it with Kellner? 
A Ko. 

MR. ncGOUGH: Let me interject. I think you said 
earlier you did discuss it with Kellner. He mentioned 
something about Hasenfus? 

TH2 HITNESS: That was only recently. I said to 
hla, because I confronted him with the memo and all. I 
don't know if I asked him or if he volunteered it. I have 
the exact day and the time that he told me this back in my 



UNCLASSIFIED 



146 



NAnE = 
2790 
2791 
2792 
2793 
279M 
2795 
2796 
2797 
2798 
2799 
2800 
2801 
2802 
2803 
28014 
2805 
2806 
2807 
2808 
2809 
2810 
281 1 
2812 
2813 
28m 



HIR120000 



mumB 



PAGE 117 



notes in my oiiice. 

If you uant it. just give mtt a ring. I will let 
you know. 

MR. HcGOUGH: Can you give us a general time frame? 
THE HITHESS: Uithin the last three or four weeks. 
He told me the reason he signed off was because of the 
Hasenfus crash. 

BY ns. HAUGHTON: 

S Did he say he had spoken to Hark Richards or anyone 
at DOJ prior to that decision? 

A No. He didn't tell me that. Not that I recall. 
The only thing I recall was somehow or other we got into a 
conversation--! remember when he told me that, X couldn't 
help but grin. Because--! don't know. 

Q It is like an ''I told you so?"' 

A Not like an '*! told you so.'* let me tell you 
something. The Hasenfus crash made no difference to me . I 
Know what my case is about. There were some--there was some 
involvement of Hull and Owen. One aspect of the case--my 
understanding of the case has gone — you Know, it has expanded 
tremendously since January when we really got started with 
th« grand jury. Even in November, based on what I had 
gathered up to date, I still wasn't quite sure how all the 
pieces fit in. For the most part, the case about people in 
private organizations, basically on their own, going out and 



UNCLASSIFIED 



147 



NAME: 
2815 
2816 
2817 
2818 
2819 
2820 
2821 
2822 
2823 
282(4 
2825 
2826 
2827 
2828 
2829 
2830 
2831 
2832 
2833 
283U 
2835 
2836 
2837 
2838 
2839 



HIR120000 



KUSSIFIED 



PAGE 118 



recruiting help ior the FDK or putting their own little 
paraallltary groups together. 

I knew somehow or the other that Hull and Owen £lt 
In. but they were not central. The people who were central 
In the case were--and really still are--are Renee Corbo and 
various people in the CKA , and a host of Cubans. 

There is even to this day Hull and Owen are 
involved, but they are in a gray area, in ny opinion. 
Ultimately. I haven't--! better not go any further with this. 

The bottom line is that the Hasenius thing meant 
nothing to me . I didn't--! didn't go running down to Leon 
and say, ''Let's get going,'' that wasn't my place. ! work 
for him. He doesn't work for me. 

On December 2nd, we had another meeting. !t was 
Kellner. Sharf. Barnett. Gregorie. He were talking about 
the different allegations being made, different issues we 
had to consider with respect to Garcia. 

Leon told me he wanted me to find out if we were 
used. He wanted me to reinterview Saum, who was Saum, why 
did he come to Hlami, who was he working for, was Cuteen 
involved, trace Saum tickets from Huntsvilla, Hiami, to 
Huntsville. Stay away from Cuteen, Diaz and Hamburger. Ha 
was under indictment at that time. 

Ther« was a question about allegations about our 
turning away evidence. What can we do about it. They 



uNWSsra 



148 



KAtlt- 
28>40 
281*1 
28it2 
28<43 
28M'4 
28145 
28U6 
28147 
281(8 
28149 
2850 
2851 
2852 
2853 
28514 
2855 
2856 
2857 
2858 
2859 
2860 
2861 
2862 
2863 
28614 



HIR120000 



Msra 



PAGE 119 



basically concluded there is nothing we can do about it. It 
is a allegation. 

Hattes--at this tine/ this is when I iirst found 
out — the article in The Hiami Herald about my threatening 
nattes did not come out until December 12. I received a 
phone call from a reporter in San Francisco and learned a 
FOIA Act had been stated suggesting Z had read Mattes' 
rights at the March 1 U meeting. 

The FOIA request was being considered by Justice. 
They wanted to know ii I should — I wanted to know Xi I should 
turn over my notes from the meeting. I was told don't turn 
over my notes because they are part of a pending 
investigation. 

There was a question--you know, this goes back. 
There was a question on whether or not we were going to 
pursue the Boland amendment violations. My recollection is 
that that was basically not put off to the side, but when we 
talked about it, it didn't appear that we had any 
jurisdiction over that matter. I operated under the 
assumption that that was out of our turf. Whether they 
passed it on or made mention of it to anyone else, I don't 
know. 

I asked them again on December 2nd what should I do 
with respect to any connection with North, Owen, Hull. They 
told me to continue to explore and I was told put Owen into 



CUSSIRED 



149 



NAME: 
2865 
2866 
2867 
2868 
2869 
2870 
287 1 
2872 
2873 
2874 
2875 
2876 
2877 
2878 
2879 
2880 
2881 
2882 
2883 
288(4 
2885 
2886 
2887 
2888 
2889 



HIR120000 



UNCUSSIFIED 



PAGE 120 



-h 



the grand jury after getting iniornation. 

So all oi a sudden Rob Owens, when I started gather 

A 

infoxnation, X was able to put Owen at a particular iteeting 
in Miami. I got that information after I got authorization 
to go to the grand jury. There were many meetings. 

Let me tell you right now that Rob Owen was at tons 
of then. Not tons, but a significant number of meetings 
with players involved in both the Cuban and the CHA 
organizations . 

So--this was starting to coma more to light around 
this time. I was told to just keep pursuing it, just go for 
it. I was told to continue to advise the people that were 
going to the grand jury that they were subjects. 

Q Has there discussion at that time of independent 
counsel being appointed? 

A No, not that I recall. There may have been, but I 
don't recall. The first discussion I had about the IC was 
on December 29. He decided not to go forward with the case 
because of the provisions of 28 USC Section 597, which 
requires us to suspend our investigation pending a 
determination by the IC as to whether or not he has 
jurisdiction over our case. 

On 1-21-87, I was informed by Hr . Kellner at 2=00 
p.m. that Judge Halsh declined the case and I was to 
proceed . 



D 



150 



KAME: 

2890 
2891 
2892 
2893 
289U 
2895 
2896 
2897 
2898 
2899 
2900 
2901 
2902 
2903 
2904 
2905 
2906 
2907 
2908 
2909 
2910 
2911 
2912 
2913 
29m 



HIR120000 



UNClASSIFiE 



PAGE 121 



Here ue are today. 

2 Did anybody from the independent counsel or FBI 
interview you? 

A Yes. 

8 Uhen uas that? 

A April 7, at 10:20 a.m. of this year. 

B Has that in connection with the substance of the 
investigation or with the possible slowdown? 

A After the Village Voice article came out saying 
there uas a slowdown. 

Q That was the nature of the interview? 

A I was told initially they were not going to 
investigate the slowdown. In fact, whan I was — around the 
time I uas told to go forward, I was told they are not 
investigating the Hattes allegations against me. 

After the Village Voice article came out, they told 
me that they were going to investigate. I said, great, go 
for it. 

2 Do you know whether or not there is an OPR 
investigation? 

A Oh, yes. They have become very popular. 

e Did the FBI in that interview ask you anything we 
haven't? 

A Which interview? 

e 4-7-87. 



INCLASSIFIED 



151 



KANE: 
2915 
2916 
2917 
2918 
29 19 
2920 
2921 
2922 
2923 
292tt 
2925 
2926 
2927 
2928 
2929 
2930 
2931 
2932 
2933 
293U 
2935 
2936 
2937 
2938 
2939 



HXR120000 



UNCUSSW 



PAGE 122 



A No. I basically told then the chronology. X wrote 
out a summary of my interview with them. That is basically 
it. The only thing I didn't have in this interview was the 
letter I wrote on 3/28 in response to Mattes' 3/27 letter. 
That is it. 

2 The FBI memo you referred to of March 21, 1986, 
apparently it is a compilation of several interviews and 
things ? 

A It is everything from December 27 up to May 1 >4 . 
All of the dealings between Currier and Kattes . 

Q Just Kattes or the whole facts of the case? 

A Basically, what was going on. 

2 Okay. 

Did you ask for such a compilation? 

A No. In fact, what happened was after the December 
12 Miami Herald came out. Mattes accused me of threatening 
him, Kevin told me about the memorandum and it was great 
because it had his contemporaneous recollections about the 
events which Mattes was accusing me of. 

2 Okay. 

A That is when I got--I didn't know it existed until 
aitar Dacenbex 12. 

fi Of 1985? 

A No; December of 1986. 

2 Oh, you didn't know there was that? 



uNwssife 



152 



NAME: 
29H0 
2941 
29U2 
29143 
294<{ 
2945 
2946 
2947 
2948 
2949 
2950 
2951 
2952 
2953 
2954 
2955 
2956 
2957 
2958 
2959 
2960 
2961 
2962 
2963 
2964 



HIR120000 



oNcussra 



PAGE 123 



A I didn't know. The FBI appazently has certain 
rules regarding which documents the prosecutor can see and 
which documents you can't see. You can't see the 
administrative section for some reason. It is basically-- 

2 I want to ask you about a series oi names now. You 
tell me ii they are familiar in the course oi your dealings 
either with this investigation or others. Again we are only 
looking ior information prior to December 4. 

A Okay. 

2 These are either people you have mat« spoken to> or 
heard discussion oi or seen reference to in documents. In 
other words, the only thing I am excluding from this is 
media reports. 

A Okay. 

2 In other words, if you are talking to somebody in 
the office and this name is mentioned, I do want to know 
that. 

Elliott Abrams . 

A Where did that name come up? Give me a minute. 
That name did come up. It has come up very recently. The 
naB* has come up. I don't remember how it came up. I could 
find out. Just give me a second to think about that, okay? 

Oh, I know how that came up. It came up in a way 
that I think you need to know about, but I found out about 
it by interviewing a witness. You better take it up with — 



UNCUSSIFIED 



153 



NAME: 
296S 
2966 
2967 
2968 
2969 
2970 
2971 
2972 
2973 
2974 
2975 
2976 
2977 
2978 
2979 
2980 
2981 
2982 
2983 
29814 
2985 
2986 
2987 




HIR120000 ' ^'t^n.^ \ ii tr^M^ PAGE 124 

2 With Justice? 

A Yes. 

Q Can you give me a point of reference? 

A The Lanhy Due interview. 

2 Lanhy Due? 

A Interview. 

2 Charles Allen? Charlie Allen? 

A Sounds familiar, but I am not sura. 

2 James Bastion? 

A Ho. 

2 Enrique BermudezT 

A Sure; Commander 380. He is a central figure, not a 
target, but he would have information about the case. 

2 He works Southern Front? 

A Enrique Bermudez? He is the main contra leader who 

works in the North, is my understanding. 

2 Richard Brenneke? 

A That doesn't sound familiar. 

2 Adolfo Romero Calero? 

A Sure. 

2 Other than the notoriety as contra leader, anything 



els*? 



I can't discuss it with you. 



mmm 



154 



NAME 
2988 
2989 
2990 
2991 
2992 
2993 
299U 
2995 
2996 
2997 
2998 
2999 
3000 
3001 
3002 
3003 
300U 
3005 
3006 
3007 
3008 
3009 
3010 
301 1 
30 12 




PAGE 125 



HIR120000 

RPTS DOTSOH 
DCHN GLASSKAP 
t 1 = 30 p.m. 1 



BY KS. HAUGHTON: 

Q Cannlstraro. 

A Spell th« last naii« . 

e C-a-n-n-i-s-t-r-a-r-o . 

A Doesn't sound familiaz. 

2 Luis Posada Cartlles? 

A That name sounds familiaz. 

8 Thomas Castillo? 

A That isl 

2 Wete you aware of that other name? 

A Ho. 

2 How do you know about it? 

A Newspaper. 

2 You were introduced to him as | 

A Yes . 

2 During the course of that investigation, did any of 
the people you dealt with refer to Hr . Castillo? 

A Yes. It's 6(c) material. 

2 Carl ''Spitz'' Channell? 

A The same thing. 

2 Linda Chavez? 



UNCUSSIflED 



155 



NAKE> 
3013 
3014 
3015 
3016 
3017 
3018 
3019 
3020 
3021 
3022 
3023 
302K 
3025 
3026 
3027 
3028 
3029 
3030 
3031 
3032 
3033 
303(1 
3035 
3036 
3037 




MI11120000 ' v/iJ 1 I //*/r» '*"* ^** 

A I don't know. 
S Dauay Clariidg*? 

A Tha nan* was — nothing significant. I know, th* only 
thing I know about him Is what I raad In tha papar. 
2 Thoaas Cllnas? 

No. 

Hllllam Coopar? 

Ho. no. Doasn't sound iamillaz. 

Danlal Conrad? 

No. 

Paul Cuttaz? 

No. 

Edwazd da Gazay? 

No. 

Anbassador Robazt Ouanllng? 

No. 

Robazt Button? 

Sounds iaalliaz. 

Robazt Eazl? 

No. 




HNCUJSIflfl) 



156 



MAME 
3038 
3039 
30H0 

3om 

30(«2 
3043 
304U 
3045 
3046 
3047 
3048 
3049 
3050 
3051 
3052 
3053 
3054 
3055 
3056 
3057 
3058 
3059 
3060 
306 1 
3062 



HIR120000 

fi No. 




PAGE 127 



FeliK Rodriguez? 



A No. I know who they are, their alleged 
involvenent, and it wouldn't surprise ma if they are 
involved because the flights we are looking into went into 



e Donald Gregg. 

A That nane cane up in Sam Allen's papers. That was 
the only place I saw it. 

2 There was a reference to a search of Tom Posey's 
office or where he was living. 

A I don't know about that. 

2 Did you ever hear of a search being conducted? 

A No. There was a--thete had been numerous customs 
searches of Tom Posey's equipment that Tom Posey had 
delivered to Mario Calero, October 21 — I mean, October 18, 
1984, I believe. Similar searches were conducted in 
November and December. I know in October, '84, Customs put 
on a big show at Kenner Airport, they had a search there. 

2 Do you know whether or not Oliver North' s rumber or 
reference to him was found in any of Posey's material? 

A I can't tell you that either. The only place I 
believe I have even seen that is Allen's papers. That's the 
best I can recall. There was one other call, and 1 can't 
tell you about it, but also to that number. Oliver North's 



»\ASSW 



157 



NAME: 
3063 
30614 
3065 
3066 
3067 
3068 
3069 
3070 
3071 
3072 
3073 
3074 
3075 
3076 
3077 
3078 
3079 
3080 
3081 
3082 
3083 
30814 
3085 
3086 
3087 



HIR120000 



UNCUSSIFIEO 



PAGE 128 



name comes up in the investigation, my investigation, but 
nothing--! can't discuss this with you. I wish I could. 

2 What I am concerned about, does it come up before 
December ^ or after? 

A Before. 

2 When? 

A I can't tell you that. 

e All right. 

You can't tell me that because it is 6(c). 

A Right. It's all information I got--if it is not 
6(c), it is information obtained regarding an open 
investigation. Just work this out with Tom. 

S See, we have--ordinarily in an interview, w« have 
someone from Justice here, and right now I kind of wish we 
did, because-- 

A He told me he wasn't permitted to come today. 

2 That is right. That is right. 

A Our agreement, though, is that we will get verbal 
briefings on open cases but no documents. I don't want you 
to trust my word. I mean, I understand your concern. We'll 
work that out. Okay. 

S Albert Hakim? 

A Ko. 

2 What about Lake Resources? 



Ho. 



UNCLASSIFIED 



158 



NAHE: 

3088 
3089 
3090 
309 1 
3092 
3093 
3091 
3095 
3096 
3097 
3098 
3099 
3100 
3101 
3102 
3103 
3101 
3105 
3106 
3107 
3108 
3109 
31 10 
3111 
31 12 



HIR120000 



UNCUSSIFIEO 



PAGE 129 



8 Uilliam Langton? 

A Ko . This is obviously to the bast oi my 
recollection. Thete have been tons oi names. Lake 
Resources sounds iarailiat. 

2 Ramon Medina? 

A Ho. 

S Constantine Manges? 

A No. 

2 Richard Miller? 

A Ko. 

2 Herman Moll? 

A Ho. 

2 H. Ross Perot? 

A His name has come up. 

2 Post December 1? 

A Yes, but I would say in an insignificant way. His 
name has just come up, that's it. Nothing really — 

2 

A The name sounds familiar, but not in the context of 
the case. 

2 DZA agent? 

A Out of where? 

2 Washington now. 

A I recall seeing something. Even just a note or 
something. Some Customs documents. I am not real sure. 



WNJUSS/flfl) 



159 



NAME: 
3113 
3114 
3115 
3116 
3117 
31 18 
3119 
3120 
3121 
3122 
3123 
3124 
3125 
3126 
3127 
3128 
3129 
3130 
3131 
3132 
3133 
3134 
3135 
3136 
3137 



HIR120000 



UNCLASSIRED 



PAGE 130 



2 Raphael 2uintero? 



A Only iiom the little bit I know about it. 

2 Buz Sawyer? 

A No. Buz Sawyer, is that Caribbean Airlines? 

2 He night have worked there. 

A No > doesn't sound familiar. 

2 Nestor Sanchez? 

A No. 

2 Richard Secord? 

A No. 

2 Ted ShacKley? 

A No. 

2 John Singlaub? 

A Yes. 

2 Is that pre-December 4? 

A Yes . 

2 How did his name coma up? 

A Can't tell you. 

2 Ambassador Iambs, hava you heard from him since 
that meeting in Costa Rica? 

.A Ko. 

fi Hava you heard anything about him since then other 
than public madia? 

A I hava heard ha dacldad to taach at tha University 
of Arizona. Other than that, I don't know. 



MimifiB 



160 



NAME: 
3138 
3139 
3140 
31141 
3142 
31143 
31(4 4 
3145 
3146 
3147 
3148 
3149 
3150 
3151 
3152 
3153 
3154 
3155 
3156 



HIR120000 




PAGE 131 



No. 



Chuck Tyson? 

I have heard the name, but I don't remenber the 



S 
A 

context . 

Q Faith Whittlesey? 

A Ho. 

BY MR. nCGOUGH: 

S Can you tell me a little bit about Mattes' 
background, if you know? 

A I know that he graduated irom the University of 
Hisconsin, a former State Legislator. 

Q About how old? 

A He is about 38. 

S How long has he been with your office? 

A The Garcia case was the first trial. 

S He is still with the PD's office? 

A Yes. Ha had a sister who worked for Senator Kerry. 
X am just getting that through the press. 



KNMSlfiffl 



161 



HIR120000 



RPTS DOTSON 



DCHK B&HNAN 



""mm 



PA6Z 132 



2 You said b«ioie you took--whan you wsr* considAting 
taking the first trip to Costa Rica> you callad Avirgon? 

A Yas. 

C Hhy? 

A Bacausa Avixgon and Honay had baan at tha trial and 
thay uera tha onas apparantly faading this iniormation to 
Tarrall and thay saamad lika a good sourca oi infomation. 
As long as thay wara willing to naat with ma on a 
voluntary basis, that was my initial — thay knaw a lot, 
aspacially about tha assassination plot. Baiora I lait, I 
ramambar thinking to mysali thay wara troubla for soma 
raason. ^Z just got a bad faaling about tham, aspacially 
aftar A>^irgon told ma that Hattas had said thay wara targats 
of tha grand jury and thay wantad to hava thair lawyars 
prasant. It was too much lika an advarsazy ralationship at 
that point. 

Q You dasoribad having a six-hour maating on March 
28. 

A Right. 

3 You say it was six hours long. Is that bacausa you 
ramambar it baing six hours long or you hava a notation 
somawhara that it was six hours? 

A I'm showing counsal my data book with tha notation. 



UNCLASSIHED 



162 



KAHE: 
3182 
3183 
31814 
3185 
3186 
3187 
3188 
3189 
3190 
3191 
3192 
3193 
3194 
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PAGE 133 



spoke to Kellner six houis. 

2 X sea . Do you normally make notations in your book 
about the length meetings take? 

A That was> you knoH--the answer to the question is 
no. But for some reason I did. 

S The folloH-up is why in that case? 

A I don't know. It was--I remember that was a 
significant meeting because that was the meeting where I was 
told to go to Costa Rica. I was seeing Leon Kellner. my 
impression is that I was seeing him so frequently, and the 
conversations were so redundant in that we never made any 
progress, it always--! always came out feeling more confused 
than X did when X first went in, I felt like X was losing 
credibility, in all candor, because I couldn't coma up--I 
couldn't tell them what we're looking at. I just couldn't 
do that. 

X can today. X couldn't do it then because X 
didn't have the — I didn't know him at that point. I had bits 
and pieces of different icebergs and I was — X felt like X was 
being expected to tell them what was underneath the water 
line without being given a chance to explore . 

That's all I remembered during that period. I wish 
I took notes. X took no notes of those meetings with Leon. 
X started keeping an events log, which X will provide you a 
copy of, and my notations were very brief. 



UNCUSSIREO 



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HIR120000 



yNCUSSlFiE 



P&GE 13U 



In retrospect, that was a nlstake, but that is just 
th« May it is. 

8 But this note in youz book was nade 
retrospectively, aiter the meeting was over? 

A I don't Know. I don't believe so. I believe it 
was made that day. 

fi I mean aiter the meeting it says in past tense, 
spoke with Kellner six hours. 

A Right. 

2 You had mentioned--! an hoping here, I am trying to 
pick out some questions that arose. 

When you went down to Costa Rica and you went to 
the embassy, you were advised by someone that Ambassador 
Tambs was entitled to know everything about the 
investigation. 

A That was George Mitchell and Nagel. That is the 
best recollection I have on that. 

2 At that time you didn't really question that? 

A I questioned it but, you know, the thought that was 
going through my mind is I'm going to get oii on a bad start 
if they find me asking questions that I had not told them 
that I was going to ask. So I told them everything. 

fi They obviously knew that you were coming, you just 
didn't show up on their doorsteps. 

A Ho. There were preparations. 



UNCLASSIHED 



164 



HAME: 
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UNMSSIfe 



PAGE 135 



2 Did you take caia of those preparations or did you 
contact the embassy before you went down there or uas that 
handled by someone else? 

A The only thing I did--I think the FBI did it, number 
one, and all I recall doing is sending my application for an 
official passport up here to Washington. 

e Could you get any feel for how much they knew about 
the purpose of your visit when they arrived? 

A I don't think they really knew. I remember 
speaking with Mitchell and I told them what we were down 
here to explore. That's when I was told the ambassador--my 
recollection, I don't remember the exact words, but I still 
remember I had the impression I was told the ambassador is 
entitled to know about everything you are doing down here 
because he is, in essence, the President, for all practical 
purposes, in Costa Rica--President over American activities, 
not obviously over Costa Rican activities. 

But I remember just debating to myself whether it 
was wise to talk about — to show him the chart, especially in 



Actually that couldn't have been because he didn't 
know the^^^^^^^fwas coming. I had decided I was going to 
play it square, and that is what I did, Z played it square. 

e Going to the meeting of April 4, Barnett, Sharf, 
maybe Gregorie, you said Leon came in for a short period of 



ONtftSSIflED 



165 



HIR120000 



^nmEB 



PAGE 136 



A Right. 

fi Do you racall--was he brought in just on the Boland 
amendment? 

A That's it. 

S How long was he in there? 

A He was in there for more than several minutes . 

Q Is he anything other than an Assistant U.S. 
Attorney down there? 

A No. 

8 Does he have a special status? 

A No, just another assistant. 

2 It was at that meeting I think you said — 

A He is in the appellate division and Knows how to 
work jurors very well. Ana Barnett was the one who asked 
him. This is what she told me recently, she saw David on 
the machine and asked if he could pull it and ha agreed. 

fi You say you came away from the meeting with an 
understanding nobody understood what the case was about, 
that you were going to write a memo? 

A I cane away from the March H meeting feeling as 
if — you will excuse the vernacular — that my bubble had been 
popped. I came back psyched from the Costa Rican trip and I 
felt that I was in the middle of something very important, 
and, granted, I didn't come back with an assassination plot 



UNCLASSIFIED 



166 



UNCLASSIFKD 



NAnZ: HZR120000 Ul^ilUflt/vl' II^W PAGE 137 

3282 or large arms shipment, I still felt Z was coming back with 

3283 evidence regarding neutrality violations and still had 

3284 sufficient evidence to explore the gun shipments. 

3285 So I really felt that I would go full speed ahead. 

3286 When I went into the March U meeting, there was no 

3287 assassination plot, and evidence of the gun shipments was 

3288 weaK, and there was very little interest expressed in my 

3289 opinion on the neutrality matters — not interest, but just I 

3290 felt it was comparatively insignificant and I was told to 

3291 write a memo. 

3292 That was weeks at that time, plus I had the boiler 

3293 room, so nothing was going to get started quickly, and I 
329U told the agents that. They knew I was upset. I was upset. 

3295 & At the time you were told that, were you told why 

3296 you were to write a memo? 

3297 A They wanted to be able to sit down with something 

3298 and study. 

3299 S At that time did you know there was any intention 

3300 to provide that memo to the Department of Justice or anyone 

3301 else? 

3302 .A No way. No. 

3303 a So it was just kind of a thought piece for you and 
330^ Kallner? 

3305 A Obviously it helped me, because it gave me a chance 

3306 to sit down and realize what I had and go over the documents 




167 



HAHE' 
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UNCLASSIHED 



PAGE 138 



that I had. But the document--! suspected that it was going 
to Washington. X was never told oiiicially, but I knew it. 

Outside of that--when I asked them to clarify it, I 
asked them to clariiy the memo because there was uhat I ielt 
was classified information in there, and they stamped 
•'sensitive'' on that. 

2 Did you discuss or do you recall any discussions 
about what was to go into the memo? Not as far as exact 
substance, but what pieces of information? 

A I went ahead, I drafted the memo myself. He didn't 
like the first draft. He wanted a more comprehensive memo. 
I gave him a more comprehensive memo. Even prior to Hay 20 
he had made changes. Ma struck out some of the language. 
But he still concurred with the grand jury. 

I would not say substantive changes were made in 
any draft prior to Hay 20. May 20 I was told to change the 
recommendation, clear and simple. I accepted it because I 
had more experienced people telling me that I was wrong, but 
in my heart I knew what I wanted to do. 

But I wasn't going to fight them; that is not my 
plaoa. Tha only thing X could do is make a recommendation. 
Tha only mistake that X made, I faal, was not sticking, 
letting my xeoommendations stay on tha face of tha memo. 
But as it happened, it didn't make much of a difference 
anyway because my last memo--my last draft, which contained 







168 



HAKE: 
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PAGE 139 



provisions oi language that they felt was appropriate, was 
even changed without my seeing it and sent to Washington. 

C In the course of your discussions over that nemo, 
did you talk about grand jury subpoenas for witnesses 
differently from grand jury subpoenas for records? 

In my experience, one of the earliest things you 
get out in an investigation is your records, because they 
take a long time to get in. You like to have the records in 
front of you when you are doing witness interviews. 

In those discussions did you differentiate between 
records subpoenas and witness subpoenas? 

A I asked — I told them I needed both. You know, it's 
in there. The Bureau felt that some witnesses were 
deceiving us and we also wanted to obtain some bank records 
and some--I think they said Air records. 

Even from way early on, from the very first meeting 
we had on January 22, one of the first meetings where we 
talked about how we were going to corroborate Garcia, we had 
noted that we needed bar records from the hotel, the hotel 
records, airline racords--obviously a lot of subpoenas could 
have been sent out at that point, but they persisted that we 
didn't need it, we didn't need those records at that time. 

2 When the final draft that was done by — I think you 
said Sharf changed the — 

A Let me just make one — I came away, though, feeling 



mmm 



169 



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UNCLASSiHED 



PAGE mo 



up to the May 20th meeting it was only going to be a little 
bit acre, that ue were close, they just needed a little bit 
more, and I nevex had any idea we were going to be close to 
six months. 

So, you Know, that's just the way it was. Go 
ahead . 

S I was going to say, at the conclusion oi the memo I 
believe you said Hr . Shati wxote that ultimately went to 
Justice, there were several sentences added about why record 
subpoenas weren't needed? 

A Right. 

Q It might be prejudicial or something like that. 
Had that discussion taken place, had those items been 
discussed? 

A At the meeting we talked about whether it was 
important to know who the contributors were, and they ielt 
it wasn't important. But to me. you never know what you are 
going to find, and when X — I'll just send subpoenas out on a 
whim ii X have a reason--ior example, if I go ior toll 
records and I find a call was made irom a particular phone 
call in a hotel, a subpoena goes right out to the hotel 
asking ior any hotel records ior any particular people. You 
don't know — obviously you can only imagine where something 
like that can lead you. 

So to me , I only need even the most barest oi 



Mmm 



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PAGE 141 



evidence to justify sending out a subpoena. That is the 
whole purpose of a subpoena. 

They felt otherwise. They felt with respect to the 
Canan records, it was not going to be beneficial. In terms 
of talking about not identifying Kellner's associates, that 
was never, to my recollection, said. That was the whole 
purpose, was to find out who was behind Canan. 

2 Okay. In June the Thailand case came your way. 
you said somebody was pulled off to do the Miami police 
investigation that came into your hands then? 

A Yes. 

C Can you give me a little more detail how that was 
assigned to you? 

A Dick Gragorie, who was my supervisor at that time, 
said that the Thailand case — I had spoken to Pat Sullivan 
before I spoke to Dick and I knew he had a case which 
required a trip '^o Taiwan . ' I found out from Oick--he was 
just talking to a few people--that the case had become 
available because Pat Sullivan was taking over the Miami 
Cops case, so I jumped on it. 

fi Has there any attempt to assign you to the case? 

A No. 

e Hhat 1 am trying to get at, did it come from your 
direction or from theirs? 

A The answer to the question is no, Leon Kellnar did 



UNCIASSIHED 



171 



. f*?' 




HIR120000 ir--— pjQj 142 

not put ne on tha Thailand case in otdaz to give ne a reason 
ioz not working on the contra case. I volunteered ior the 
Thai case. 

2 That was the more direct way of getting to it. 
A No, it uas voluntary. 

KS. NAUGHTOK: I have one last question for the 
record . 

BY ns. NAUGHTOH: 
2 What instructions, if any, were you given by Hr . 
Boyd, Mr. Berquest or anyone at Legislative Affairs, other 
than don't speak about the open cases? 
A I spoke with Kimberly. 
2 Kimberly All^n? 

A I spoke with her. I insisted I be permitted to 
show you the documents, I was not coning here under any 
conditions without the documents, and they ultimately agreed 
to that. 

I was told not to talk about 6-^^naterial . She 
gave me a list of a few things. It was meaningless to me. 
Other than grand jury material, I have basically 
given you everything. I would also add Information 
pextaining to the merits of the case itself. But I don't 
think you really asked ne much about that. 

And I saw Tom, Z met hin for the first time this 
morning, and he basically told me if you jump up and start 



UNCLASSIFIED 



172 



KAME: 
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HIR120000 ynyt.HuUII ILU '***'*' ^'*^ 

yelling at me> to stay calm. 

fi Have we jumped up? 

A He was saying it facetiously. 

2 Hhat about Mr. Kellnez> did you discuss youz 
testimony with him? 

A He went over the chronology. I had prepared the 
chronology for the interview with the IC's odEiice. I 
formally prepared the chronology last week. I had it typed, 
and then I went ahead and prepared sections with the 
supporting documents to correspond by date with the 
chronology, and then I finished that Friday night and 
Saturday the book was put together and Saturday afternoon X 
called Leon and told him that I prepared the chronology — he 
did not request it — and I asked hin if I could drop it off, 
because we had planned a meeting for this past Monday, and I 
dropped the chronology off and then on Monday we went--just 
like we went through today. 

The only changes in the chronology that were made 
is that I gave him the memo, FBI memo on August 8th of '86, 
rather than July 31, and he advised me that we did in fact 
have meetings on 4-25 and 5-5, because he had notations in 
his book. 

And we also--I had thought that the discussion about 
his appointment was on the 4th when I got back from Costa 
Rica, and it apparently wasn't. It was on the 11th when he 



iJCLASSIFIED 



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ONCUSSIFIED 



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got back from Gx«at Britain, tha day of th« TBI shooting. 
Oux maating was. I would say. pratty comprahansiva . 

Q To your knowledge, wera thara any diiiaxancas in 
your lecollactions . othax than tha datas oi tha naatings? 

A I basically conducted the conversation. It wasn't 
like do you remember this, this and this. I went through 
it, showed them the documents and that was it. There was no 
suggestion that we change testimony or anything, nothing oi 
that sort. It was just simply going through events as I 
remembered it and occasionally I would look at his data book 
and just confirm whether or not meetings did occur on that 
date. 

S Has there any discission oi anything not to say? 

A No. 

[Whereupon, at 2:08 p.m., tha deposition was 
adjourned . ] 



*MSSIf/fD 



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VJa. HOUSE OF REPRESENTATIVES 



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^ Office of Official Reporter! 



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(175) 



176 



KANE: HIR168000 PAGE 1 



R?TS SUHIEL 
DCHN SUHIEL 



UNCUSSIHED 



DEPOSITION or JEPFREY PELOHAN 

Wednesday, June 17. 1987 

U.S. House of Representatives, 

Select Comnittee to Investigate Covert 

Arms Transactions with Iran, 
Washington, D. C. 



The Comitittee met, pursuant to call, at 9 -HZ a.m., in Room 
2203, Rayburn Mouse Office Building, with H. Thomas HcGough, 
Jr . , presiding . 

On behalf of the House Select Committee: Pam Naughton, 
Staff Counsel; Ken Buck, Assistant Minority Counsel. 

On behalf of the Senate Select Committee: h. Thomas 
HcGough, Jr., Associate Counsel. 

On behalf of the Witness: David Goodhart, Goodhart £ 
Rosner, P. A., 10th Floor Bank of Hlami Building, 2 1 
Southeast First Avenue, Hiami, Florida 33131. 



Parfislly Declassified/Released on /-■^^ — iL 

under provisions of E.O. 12356 

by N. Menan, National Security Council 



uHtmsro 



177 



MAKE: 
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HIR168000 iiiui,! u.A.Aanr II page 

MR. HcGOUGH: This is a continuation of the 
Daposition of Jeffrey Feldman. I'm Tom McGough, Associate 
Counsel to the Senate Select Committee. Also present is Ken 
Buck. Ken is Deputy Minority Counsel to the House Select 
Committee . 

He are waiting for one other attorney to arrive. In the 
meantime, we're going to swear the witness and then recess 
so that Mr. Feldman can examine a copy of his earlier 
deposition before the committee. 

Mould the Sergeant at Arms please swear the witness? 

Whereupon/ 

JEFFREY FELDMAN 
having been first duly sworn, was called as a witness 
herein, and was examined and testified as follows: 

THE WITNESS: I'd like the record to reflect that 
the copy that's being provided to me at this time is not a 
copy of the official transcript but a computer-generated 
copy from the Senate Select Committee. Is that right? 

MR. McGOUGH: That's right. And what we're doing 
is trying to arrange to get a copy of the official 
transcript ov«x here. In the meantime, Mr. Feldman can take 
aad look at what we have, and then when the official 
txmnsczipt arrives, pick up there. 

With that we'll recess the deposition. 

[ Recess . ] 



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IINPSSIFIED 

ns. NAUGHTOK: Ha axe bac 



HIR168000 lll\il I nXXini"!! page 3 

>ack on the record. It's one 
o'clock of the same day. 

Hy name is Pamela Naughton> Staff Counsel for the House 
Select Committee to Investigate Covert Arms Transactions 
With Iran. Otherwise, the principals in the room are the 
same . 

The witness has been sworn. 

EXAHIXATION OK BEHALF Of THE HOUSE SELECT COHHITTEE 

BY MS. HAUGHTOH: 

2 Mr. Feldman, could you spell your name again for 
the record? 

A reldman — f-e-1-d-m-a-n. First name is Jeffrey. 

fi Okay. And again, your occupation for the record. 

A I'm an Assistant United States Attorney for the 
Southern District of Florida. 

fi Kow, Hr . Feldman, you've had the opportunity to 
review your deposition taken, I believe, last month? 

A Right. There are numerous mistakes in the 
transcript. I've made notations on some of them, but 
toMazds the latter part t:.ere were just too many. I didn't 
•van bother writing them down. It's going to take time to 
review and to correct. But I have, you know, right--just 
here about two and a half pages of corrections at various 



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HIR168000 



UNCUSSIFIED 



points in the transcript. 

(Discussion off the record.] 

MS. NAUGHTON: That's a good idea. 

BY MS. NAUGHTON: 

2 Why don't we attach, then, your notes as an exhibit 
to this deposition? 

A I don't think you're going to be able to make them 
out . 

Q Well — 

A What I could do, if you want, at a later point I 
can go over the areas that need to be corrected. For the 
most part they're just names and grammatical errors which 
are significant because they change the meaning of the text. 
But I think we can do this at a later point. 

2 Okay. What I would ask you to do, then, is to 
submit in writing your corrections to the record. That will 
go to our printer's office and to the reporter's, and then 
the corrections will be ruled on by the committee and then 
the corrections will go into the record. 

A Okay. 

fi That's our normal procedure. And then, if you want 
to review a corrected transcript again, you can be given the 
opportunity at your convenience to review the transcript. 

A Okay. 

Q Now you discussed in your last deposition a case 



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UNCLASSIHED 



PAGE 



Which. I will rei«r to as the Garcia casa for lack of 
anything alsa> but at this point wa'xe talking about an 
investigation into possible violations of the Neutrality Act 
and other statutes involving Costa Kica and Nicaragua; is 
that correct? 

A The Garcia case was a gun casa. From the Garcia 
case we began a historical investigation which ultimately 
led to neutrality allegations. 

8 Okay. For purposes of clarity, why don't you tell 
me what you have labeled the investigation as? 

A Hell, the investigation is called Costa I. That's 
the official nana that's been given to it by the office, and 
that file was opened officially on March 16th of 1985. 
MR. HcGOUGH: Excuse me. Coastal? 
THE WITNESS: Costa--C-o-s-t-a~I . 
BY MS. NAUGHTON: 

S nazch 16th, 1986? 

A '85. I'm sorry. '86. You're right. 

fi All right. And how do the FBI records refer to 
this casa? 

A I really don't know. Just — I think they just have 
''nautrality matters.*' 

Khan you say ''this case,'' I'm talking about the 
Costa I investigation. Hy recollection is that they have 
referred to the casa by their file number, which I don't 



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KnoH offhand/ and sometimes under the heading of ''Kene 
Corbo . ' ' 

HR. HcGOUGH: Okay. Mould you spell that for the 
record? 

THE WITNESS: C-o-r-b-o. 
BY ns. HAUGHTOH: 

2 Now, Kr . Feldman, ue were talking about your 
activities in the spring of 1986 regarding this 
investigation, and there was a point in tine in early April, 
the first week of April, 1986, that you went down in Costa 
Rica; is that right? 

A Right. 

Q And you returned approximately April Uth of 1986? 

A That's correct. 

2 Do you recall a meeting in the office of U.S. 
Attorney Leon Kellner on that date? 

A Yes. 

2 Do you recall during that meeting--f irst of all, 
could you recall for us who was in that meeting? 

A Okay, as I've previously stated, I believe that the 
U.S. Attorney was there, Mrs. Anaa Barnatt, Mr. Larry 
Se^arf, and I believe Hr . Dick Gragoi^ was there. I'm not 
real sura on Dick. And a Hx. David Lalwant was there for 



part of the meeting. 
2 Hr. st 



harf was there, is that correct? 



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Right. 




ussim 



S And you're not sure about nx . Gregory? 

A Right. 

S Do you recall anyone else coming into the room at 
any time during the discussion oi this case? 

A Just Leiwant. 

Q Hou do you recall any telephone calls being 
received or sent by Hr . Kellner to the main Department oi 
Justice in Washington during the discussion oi this case? 

A The only thing--I recall, and I can't say I have a 
speciiic recollection oi telephone calls during that 
meeting, it's my general recollection that during most 
meetings that I had with Kt . Kellner there were telephone 
interruptions. But I don't have any recollection oi 
speciiic conversations he was having at any point during 
this entire investigation. His conierences were never on, 
to my best recollection, never on a speaker phone. They 
were just on a hand-held set. 

fi So, in terms oi any speciiic telephone conversation 
iron the Department oi Justice during that meeting, and 
spaciiically discussing this investigation, you can't tell 
us one way or another ii Mr. Kellner actually received such 
phone calls; is that right? 

A X have no recollection oi his receiving a phone 
call iron the Department oi Justice during the April tth 



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mttating. It's my general impression that he was on the 
phone during portions of that meeting. 

Q Do you know what Mr. Kellner's secretary's practice 
is regarding his telephone messages? 

A Ho, I don't. 

Q Did Kr . Kellner ever say to you with whom he was in 
contact at the Department of Justice during the spring of 
1986? 

A The only person that I recall Mr. Kellner having 
any contact with at Justice is Kark Richards. 

2 Mr. Kellner never mentioned Lowell Jensen to you? 

A That name was bandied about but it never meant 
anything to me other than that he was a high official in the 
Justice Department. But the contact person, the person in 
Justice that I thought Kr . Kellner was having conversations 
with, with regard to my case, was Hark Richards. 

Q So Hr . Kellner never referred to any specific 
conversations he may have had with Lowell Jensen; is that 
correct? 

A Ko . I don't have any recollection of that. 

2 Hhat about any conversations between Hr . Kellner 
and Mr. Steve Trott? 

A Sane thing. The name — Steve I knew, and still do, 
obviously. Mr. Stephen Trott was a high official in 
Justice, but I had no idea what role Mr. Trott had in this 




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iavestigatio 

2 Did Kx . Kellner evar make any references to you in 
terns o£ this investigation to John PoindeKter? 

A No> not that I recall. In what specific way? 

2 Did you ever speak to Mr. Richards or anyone at the 
main Department of Justice regarding this investigation? 

A Z may have spoken with him regarding the 
continuance that was filed, I believe, on March 19th. As I 
stated previously, I'm not sure if I spoke with Mr. Kellner 
about the Justice Department's request for continuance or 
whether I actually spoke with people up there. 

8 All right. And this is the continuance of the 
Garcia sentencing? 

A Sentencing. Right. 

fi And was it your testimony last time that you recall 
that the continuance which you filed for was at the request 
of the main Department of Justice? 

A That I'm sure of. 

8 And was that Mr. Richards' request? 

A I don't really know whose request it was. The only 
thing I can tall you is that there was a call from Justice. 
X don't — I'm not sure if I spoke with them directly or if Hr . 
Kallnar told me that Justice had requested a continuance, 
but I'm positive that Justice had requested a continuance 
because I put that in the motion as a basis for the request. 



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. * 2 And, to your knowledge, that was your basis for the 
request? 

A That was the only basis. 

I got the motion here. Let me just check 
something . 

( Pause . ] 

THE WITNESS: I'm looking at the motion for 
continuance, and they have two paragraphs' length setting 
forth the basis for the continuance, which state that we had 
the request from Justice and that the Government believes it 
would be in the best interest of all parties for the court 
to allow the Government to explore allegations which could 
possibly affect the senten'ce imposed on Jesus Garcia. 
BY KS. KAUGHTON: 

e And the date of that continuance? 

A This was filed March 19th at 3=59 p.m. The request 
from Justice based on the motion itself was made on March 
17th at approximately U:30. 

& Mould that be whan Mr. Kellnar informed you of it, 
that 14:30 on the 17th? 

A I remember I received the information late in the 
aiternoon and I would thir.k it would have been on March 17th 
at approximately >t:30 because that's when I found out about 
it. 

fi Mow going back for a minute to the April tth 



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meeting . 



mussm 



PACK 1 1 



A Ua-hum. 

2 Has there a discussion of whether or not the Boland 
amendment would apply to the investigation? 

A Yes. 

S Can you describe the context of that conversation, 
please? 

A Well, when I went to Costa Rica I had prepared a 
chart, which you're aware oi, and the chart basically 
hypothesized a scenario where Oliver Korth was pumping iunds 
irom the National Security Council through Robert Owens to 
John Hull, who, in turn, was distributing them to various 
contra-- 

HR. QOODHART: Hould you excuse me for a minute? 
[Hr. Silber conferring with the witness. ] 
THE HXTNESS : Could I have the question one more 
time, please? 

BY HS. NAUGHTON: 

fi Yes. I asked you to describe the discussion of the 
Boland amendment at that meeting. 

A The question--the issue about the Boland amendment 
M*s raised when I brought out the chart that I had prepared, 
and there ware questions as to whether or not we had 
jurisdiction to explore possible violations of the Boland 
amendment; particularly, whether or not--if money that was 



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prohibited by the Boland amendment actually flowed to the 
oonttas in the Southern District of Florida, whether or not 
there's a criminal violation. That's essentially what was 
talked about. 

S And did Mr. Kellner come to any conclusions 
regarding whether or not the Boland amendment could be used 
in such a criminal investigation? 

A Not at that point. Basically, the Boland amendment 
was one aspect of the law that we covered, and there was no 
conclusion reached at that point. There was a conclusion 
basically reached about a week or so later. 

2 Okay. Can you tell us how that came about? 

A Ue were just kicking around the <iuestion whether or 
not we have jurisdiction to investigate Boland amendment 
violations, and even if there was a violation, would it be 
criminal. And I left the April tth meeting with the 
understanding that we just didn't know, so I did some 
research. I previously told you that I had found some 
statutes which I felt would criminalize the kind of activity 
that I had hypothesized, and I believe it was during the 
meeting I had with Hr . Kellner on the day of the iita FBJ 
shootout that I explained to him that the activities which 
would be per se violations of the Boland amendment could 
possibly violate these other statutes that I had found. 

The bottom line was that I had concluded that there was 



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apparantly no criminal violation involved in violating the 
Boland anendaent but activity which would violata the Boland 
amendment would otherwise violate other title 18 provisions, 
and there was a basic conclusion reached that we really 
didn't have jurisdiction over those matters and that any 
evidence oi Boland-anendment-type violations would be 
referred to main Justice. 

S How. when you say there was a decision made, can 
you tell us what exactly nr . Kellner told you? 

A It's my recollection that he basically concluded 
that an investigation involving .allegations centering around 
Oliver North and Robert Owens, specifically with the passing 
of misappropriated funds to contra groups, would be better 
handled by main Justice than by the U.S. Attorney's Office. 
I wasn't told to disregard it. I was basically told that 
any evidence would be — any evidence that I found would be 
referred back to main Justice and main Justice would handle 
that. 

S Did Hr. Kellner indicate to you that he had spoken 
to anyone at the main Department of Justice during that week 
ox on that day? 

A No. Ho, not that I can recall. Again, Hark 
Richards was a name that I heard a lot during that time 
period, but I don't have any recollection of any specific 
calls that he may have had with anybody there regarding this 



uNtmsffl 



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Q Did you prepare any legal memoranda on the 
application of Boland to your investigation? 

A No. We got--I got a copy of the Boland amendment, I 
read it, did some research, came up uith those other 
statutes, and I came up with the conclusion that I've 
previously stated here and explained it to Hr . Kellner, and 
that was it. 

2 Did you request any such research from the main 
Department of Justice? 

A Ko. 

Q Were you ever told that any existed? 

A No. Hell later on, in August, I was given a copy 
of a legal memorandum which discussed the Boland amendment, 
but prior to that time, no. 

Q And where was this August--when you were given the 
memo in August from where did it come? 

A Mr. Kellner. 

fi And where did he get it? 

A I assume from Hr . Richards. The reason I say that 
Is because ha had told me that he was going to Washington to 
m««t with Hr . Richards. 

2 Has this a memo generatad by the Criminal Division? 

A Hell let me strike that. I found out that he had 
met with Mr. Richards. I didn't know at the time that he 



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PAGE 



15 



was going — 1 Knew he was going to Washington. I didn't find 
out until later that he had met with Mr. Richards during 
that trip. 

fi Has this a memo that was generated by the Criminal 
Division? 

A I don't know who wrote it. i 

C Well was it in memorandum iorn; in other words, a 
''to*' and a ''from'' section? 

A No. In fact, the administrative portions of the 
memorandum were clipped away, so I don't know who requested 
it and I don't know who wrote it. 

fi Was there a date on it? 

A Not that I recall.- I could check: I have the 
memorandum — 

5 Do you have it with you? 

A --in the office. No, I don't. 

6 Was there any way of telling from the context of 
the memo when it was written? 

A I would really hate to say because I haven't looked 
at it in a long — it's been a long time. I really can't say 
at this point. There may be — 

S Can you tall us generally, to the best you can 
recall, what the memo said? 

A The memo discussed the Boland amendment, the 
neutrality, various statutes under the Neutrality Act, and I 



UNClASSra 



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PAGE 16 



can't cecall if the discussion got fact specific. In other 
words, I don't know if it was a general legal discussion or 
there was a general legal discussion and then it was applied 
to various factual hypotheticals . 

I still have it. The best way I think for me to 
handle this would be to go back and to look at it and 
perhaps call you, because I'd just be guessing at this 
point. But I know it covered those specific areas. 

& That would be very helpful. Because we've received 
memos from the Department of Justice, legal opinions. I 
just want to make sure that what you got is what we got. 

A Okay. 

2 Now sometime after April 1986 did you take another 
trip to Costa Rica? 

A No. I took one trip to Costa Rica, that was it. 

fi I think you said, Mr. Feldman, that you haven' t--you 
told us earlier off the record that you haven't been 
watching the hearings; is that correct? 

A That's right. 

S All right. Are you aware that several sources have 
indicated that you and the FBI agents made more than one 
trip to Costa Rica? 

A Hall, just from you. I have only been to Costa 
Rica once in my life. That was it. 

Q Do you recall telling anyone, either in your office 



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ox* any other branch of governsftnt, that you had gone to 
Costa Rica a second time? 

A No. 

Q Did you ever tell anyone that? 

A Not to ay — no. Just no. Because it's--I've bean 
there one time. 

fi Can you give us the dates again when you went to — 

A Sure . 

2 --not Costa Rica, but Thailand? 

A Uit-huB. 6/20/86 is when Z leit ior Thailand, and I 
returned on 6/28. 

C Mere you out oi town any tiae iroa April 4th until 
June 20th, 1986? 

A Yes. I was in Fxeeport for one day on April 28th 
of 1986. 

fi Where? 

A rraeport, Bahamas. 

fi Has that on a ease? 

A Yes . 

fi Any other tiae? 

A Not that I can recall; no. 

fi And froa June 28'-h, 1986, until let's say September 
31st, 1986, Mere you out of town? 

A Septeaber 2nd I was in Key West and September Sth I 
Mas in Tampa. Now those were just one-day trips. 



UNCLASSIFIED 



193 



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PAGE 18 



I got the September 2nd. What's the other one? 



A September Sth I was in Tampa, Florida. 

S And was that on a case as well? 

A The Key West trip was on a case, and the Tarepa trip 
was ior a bar matter. 

Q Any other trips within that time period? 

A No, not that I can recall. I don't think so 
because my son was sick during August and ua were basically 
hung up. 

2 There was recently a follow-up article in the 
Village Voice. Have you read that follow-up article?' 

A Ho , I haven't. 

S The article said ihat, among other things that two 
people in the room on April >4th, 1986, during that meeting 

a. 

overhead the call and Mr. Kellnar's comments with main 
A 

Department of Justice regarding this case. Do you know who 
those two people are? 

A I know — well, I know that David Leiwant was one 
person who allegedly heard these statements made. I don't 
know who the second person is. That's basically the best I 
can do . 

fi All right. And have you spoken to Mr. Leiwant 
about this matter? 

A No. In fact, Mr. Leiwant cane to see me about this 
matter and X refused to talk to him because I felt it would 



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PAGE 19 



have caused an appearance of impropriety. 

S And was that before he came to Washington? 

A The day before he came to Washington. 

Q And since his return from Washington^ have you 
discussed this with Mr. Leiwant? 

A Ko. 

8 Have you discussed this # I'll say incident during 
the meeting of April 4th, 1986, with Anx^ Baxnett? 

A I've discussed it with her many times. In 
reference to — 

2 In reference to the alleged telephone call from the 
main Department of Justice. 

A I don't understand your question. 

2 In other words, does Mrs. Barnett recall that such 
a call occurred during that meeting? 

A I really don't Know. You Know, because I'm still 
wondering myself who the second person is--who the alleged 
second person is. I don't Know the answer to your question. 
I don't recall An*a Barnett ever telling me that she heard 
Leon Kellner tell me to slow down. 

fi Hell, wait a minute. Hy question is did she ever 
jiscuss with you or you discuss with her whether or not a 
phone call tooK place from the Department of Justice or to 
the Department of Justice from nr . Kellner's office on April 



4th, 1986? 



mussro 



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PAGE 20 



A I may have discussed that with her. 

2 All light. And what was her recollection? 

A That's what I don't know. My recollection is, is 
that she did not recall such a phone call. The reason I say 
that is because the only person, and, you know, I spoke with 
the principals who were in the roon — Hr . Kellner, Mr. 

/'e 

Gregor*, if he was there. Again, I'm not sure. But I know 



:. Saharf were 



Miss Barnett and Mr. Saharf were there, and to the best of 
my knowledge no one heard him say that. I know it wasn't 
said because I don't recall it. 

I don't know if thab answers your question. 
8 Hell my question is, then, to your knowledge, aside 
from Mr. Leiwant no one that you know recalls specifically 
that conversation? 

A I asked Mr. Kellner about the possibility of a 
second person, and he told me that the only thing that he 
could surmise is that-- 

HR. GOODHART: Excuse me. Let me step outside with 
my client for a minute. 

[Hr. Goodhaxt and the witness left the room briefly.] 
THE HITXESS: One more time. 
BY ns. NAUGHTOK: 
fi All right, let's take It one step at a time. 
A Okay. 
2 Now right now I'm not talking about the substance 



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PAGE 21 



of " that telephone call, what might have been said or what 
Hr . Kellner might have said to you. 

A Okay. 

2 I'm simply asking you whether such a call was 
either received or made to the Department of Justice 
regarding this case during that meeting. 

A Okay. The bottom line is I don't know. 

2 Sut as a context for my next questions, to ask my 
question, not the content but the call. 

A Okay. 

2 Did you discuss with the other people in the room 
subsequently whether or not such a call took place during 
that meeting? 

A The best I can say is I may have. I don't have any 
specific — other than speaking to Hr . Kellner about the 
possibility of a call, I don't have any recollection of 
speaking to anybody else about the possibility of a call 
coming from Justice or a call being made to Justice during 
that meeting. 

2 All right. So you never went, for instance, to 
Hzs. Barnett and said, do you remember such a call? 

A I don't recall doing that. 

A I don't recall doing that. 

2 Did you aver say that to Hr . Gregory? 

A I may have. I really don't know. 



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C Did any of the people in the room at that meeting 
evez tell you at any time that they recalled a telephone 
call either being made to or received from the main 
Department of Justice during that meeting? 

A I really, I'll tell you I really don't know. You 
know, that may have happened. They get phone calls from 
Justice all the time. But, you know, you're not giving me 
any context at all to deal with. I have no idea if a phone 
call — if anybody told me or in fact it actually occurred 
whether or not a phone call was made or received during that 
meeting to or from Justice. 1*9 not going to say it 
happened and I'm not going to say it didn't happen; I just 
don't know. And I don't know if anyone else told me that or 
if I approached anybody else on that. 

C I want to get your answer straight. So your answer 
is that you cannot recall whether or not anyone else told 
you that they recalled such a call was received at that 
meeting? 

A Correct. 

Q You said you discussed with Hr . Kellnez the fact 
that two people had mentioned overhearing this comment about 
slowing down. 

A Un-hum. 

Q How did that conversation come up? 

A Well I saw something about that in the paper. 



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Hhich paper? 



A I don't recall. It was maybe the Hiani Herald or 
Boston Globe or something. And X said> who is the second 
person? And he said, well, that may be Larry or Dick. They 
may have recalled that I said something to the effect, you 
know, go slow, be careful. And then he said that that's 
normal because in sensitive cases he tells his prosecutors 
to be careful. That was the full extent of it, and that's 
the only knowledge I have of the existence of a second 
person who overheard him tell me something. 

fi But I'm speaking specifically of the April 4th 
meeting and the phone call, not your subsequent instructions 
by anyone . 

A Oh. I see. Okay, no. The bottom line is I have 
not discussed the existence of the phone call with Mr. 
Kellner . 

2 All right. 

A If anything, I recall him saying that it didn't 
happen. I mean, just an outright denial by him. But I had 
no per se conversation about it; he's been denying it all 
along . 

fi The conversation you described was with Mr. Kellner 
the day of the FBI shootout. 

A Okay. 

2 Has that prior to the shootout occurring or after? 



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A No, that was aiter. 

Q So it uas later in the aiteinoon? 

A He uas coming back from London that day, I remember 
that, and it uas very late in the afternoon. 

2 Had he already visited the hospital? 

A No. I think that--I don't knou. I really don't 
know. I don't knou uhen he visited the hospital. 

HR. ncGOUGH: Well, did he refer to it to you? 
THE WITNESS: Ho. You knou, I don't think it was 
that day because he had just gotten off the plane from 
London. 

MR. KcGOUGH: So you don't think what was that day? 
THE WITNESS: i don't think that he visited the FBI 
agents the day that he got back from London. 
BY HS. NAUGHTON: 

e Have you discussed with either FBI Agent K^szjnski 
or FBI Agent Currier their depositions to the committee? 

A Just briefly. 

S Okay. And what did you discuss with them? 

A The only thing that I recall is George Kiszjnski 
asking me uhen I gave him a copy of the May 22nd draft of 
memo, and then there uere some general references to the 
tone of the deposition and very, you knou, just very general 
discussion. I didn't ask him, you know, what did you tell 
them, what questions they asked, and all that other stuff. 



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In' other words, there was no fornal debriefing of the 
agents . 

fi I'm not asking that. I just asked what you 
discussed . 

What did Mr. Kiszinski ask you about the May 14th 
roemo? 

A When I gave it to hire. May 22 — I gave — when you say 
the May mth memo, there were several drafts which had the 
date Hay lUth on it. 

e Yes, I know. That's why I'm referring to May lUth 
memo. 

A I take it you — the very first draft? 

8 No. The memo dated May 1>4th, 1986. All the 
versions have that date; correct? 

A Right. 

2 Okay. So when I refer to the May lUth memo that's 
what I'm referring to, all the versions. 

A Okay. 

e What did you discuss with Mr. Kiszinski regarding 
that memo? 

A When I gave him the draft that was printed on May 
22nd. 

fi And what did you tell him? 

A I told him I had no recollection of ever giving him 



that draft. 



OHCLftSSIFIED 



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HIR168000 VI »^— •'—-'- - pjQj. 26 

B Now the May 22nd version is which version? 

The very last drait I submitted to Mr. Kellner. 



Without Mr. Scharf's additions, is that correct? 
Correct. 

And you say that you never gave Mr. Kiszinski that 
version? 

A I said I have no recollection of giving him that 
version. 

Q And which version oi that memo do you have a 
recollection oi giving Mr. Kiszinski? 

A I have no recollection .of giving Mr. Kiszinslii any 
memo. I gave a copy of the Hay 1>tth, or the actual draft 
that was printed on Hay mth, I have a recollection of 
giving Kevin Currier a copy of that. That was the very 
first draft of the May 1>4th memo. 

2 Did you give either Mr. Kiszinski or Mr. Currier or 
anyone from the FBI the absolute final version? 

A I have no recollection of giving them that. Mr. 
Kiszinski said that I did. I don't recall doing that. 

fi Do you recall giving anyone the very final version 
of the memo? 

A I think after it was leaked a few months ago I gave 
fresh copies of the draft to people in the office to send to 
Washington. That's the only recollection I have of 
providing copies of that memo. 



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. " 2 What was the purpose of sending the fresh drafts to 
Washington? 

A You'd have to asK Mr. Kellner that. I don't knou. 

e Hhat did he tell you to do? 

A Make me a copy of the memo. 

2 And he was going to forward it to main Justice? 

A X assume. I assume that he was. 

e Has that sometime in the spring of this year? 

A Whenever it was that that memo was leaked, that's 
when this occurred. X would say the spring is fair; it was 
just a few weeks ago. 

2 And did you send your other drafts of the memo as 
well? 

A No. 

2 Just the very final version? 

A That's right. 

2 Why didn't you send your other drafts? 

A They didn't ask for them. 

MR. McGOUGH: Could I interject? When you say the 
very final draft, is that with or without Mr. Seharf's 
ohangas? 

THE WITNESS! I'm talking the draft with Mr. 
Sehazf's changes was the copy that I submitted to Mr. 



Kellner . 



w\isa® 



203 



HIR168000 



llNClASSra 



PAGE 28 



BY ns. NAUGHTON: 



fi Did anyone ever indicate to you, anyone inside or 
outside of the Government, uho had leaked that meno? 

A Ho. 

2 Have long have you known Mr. Kiszinski? 

A Oh, since March of 1985. 

2 And have you ever discussed with him in general his 
feelings regarding the contras in Nicaragua? 

A We talked about it. 

2 Okay. Do you know what Hr . Kiszinski's general 
feelings are regarding the contra causa in Nicaragua? 

A X would say that he supports the fight against 
communism. His father was the victim of a totalitarian 
state, so I think that he would support any effort to fight 
communism, and based on that I would think that he would 
support the efforts to eliminate communism in Nicaragua. 

2 Could you describe to us his ties to the Cuban- 
American community in Hiami? Are his contacts good? Are 
they non-existent? 

A I would be speculating. I couldn't do that. 

2 Hell hadn't he done prior investigations in which 
th* Cuban-American community in Hiami helped him? 

A The only — I can speak from personal experience. I 
was second chair on a case that Hr . Kiszinski was lead agent 
on. That was the Omega 7 case. In that case he and other 



BNtiftssro 



204 



HAHE: 
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7m 

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HIR168000 



«Ht\ASSW 



PAGE 29 



FBI agents basically destroyed Omega 7. That's the only 
case, the only instance that I would have to judge Hx . 
Kiszinski's ties to the Cuban community on, othec than my 
involvement with him in this case. 

2 Okay. Do you have any indications whatsoever of 
any kind that might lead you to conclude that Mr. Kiszinski 
may have leaked information regarding this particular 
investigation to anyone? 

A The only thing I'm aware of is that a letterhead 
memorandum was prepared in Harch of 1985. I believe by Kevin 
Currier, that was sent to headquarters. I have no reason to 
believe that George Kiszinski leaked any information to any 
unauthorized individuals . 

e Do you know why such a memorandum was prepared and 
sent to FBI headquarters? 

A I've since learned that Buck Revell had requested 
the memorandum. 

e And when did you learn of Mr. Revell 's request? 

A I would say sometime in the last two or three 
months . 

fi 

A 

e 

A 

e 



Did Hr . Revell ever contact you in any way? 

No. Ko . I don't even know who he is. 

Here you told the reason for Hr . Revell's requesti 

Ho. 

And who told you about Hr . Revell's request? 



musw 



205 



HIR168000 



UNCLASSIFIED 



. - A Kevin Cucrler. 

2 Do you knou whether at the time of the request that 
either the FBI agents or yourself were aware of Hr . Revell's 
relationship with Oliver North? 

A Ho. I didn't know and I don't know if they knew. 

S Do you know when Mr. Revell requested the 
information of the FBI? 

A It was sometime in March. It was a letterhead 
memorandum. A very long one. 

e In March of '86? 

A Right. Right. March of--lata Feb-ruary, Harchf 
somewhere in that area. 

2 Here you ever told by anyone either within or 
without, or outside of the Government that anyone at the 
National Security Council either requested a briefing or had 
been briefed by anyone at the Department of Justice 
regarding your case? 

A Ko . The only information I had about the NSC 
discovering anything about this case was when I was in Costa 
Rica Paul Fitzgerald told me that the National Security 
Council had spoken to John Hull the day before I was 
supposed to speak to him. 

2 Did Mr. Fitzgerald say whether or not Mr. Hull 
placed the call to the NSC or did he receive a call from the 
NSC? 



UHCUSSffl 



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HIK168000 



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PAGE 31 



A Just that the KSC had--I have my notes. Let ne 
refer to them. 

I have a note 4/3/86, 10^30 a.m./ Paul Fitzgerald 
advised that John Hull was in Kirk's office yesterday. Kirk 
told Paul that Hull had been contacted by the National 
Security Council and Voice of America regarding our visit. 
I'm reading that verbatim. 

Q Now Kirk is who? 

A Kirk Kotula. 

2 All right. So Hr . Fitzgerald is telling you what 
Mr. Kotula told him. 

A Right. 

e And you said that Mr . Hull had been at the embassy 
the day before? 

A Um-hum. 

2 On April 2nd. 

A Right. 

e And had been in contact with the KSC and the Voice 
f America? 

A Right. 

fi Did he mention any names? 

A No. This is all I have. 

e Did you ask Hr . Fitzgerald about further details of 
that. 

A The only thing I can -tell you is what I have here 



yNCLASSIFIED 



207 



HIR168000 



MIASSW 



PAGE 32 



on the paper. Ky recollection is that I did not receive any 
additional information from Mr. Fitzgerald. 

Q Did you ever receive any information as to whether 
or not nr . Hull met with Ambassador Iambs? 

A Yes. 

2 And what was that? 

A Jim Nagla, at 9:15 in the morning on April 3rd of 
1986, advised me that Hr . Hull spoke to Ambassador Tarabs the 
day before and that he had spoken with Kirk Kotula. Jim 
Nagle further told me that Kotula advised Hull not to speak 
with us without counsel, and that's when Mr. Nagle said, 
''Hull is a friend of Ronald Reagan. If you understand what 
I mean. Ronald Reagan knows who John Hull is. You Know 
politicians . ' ' 

2 The day you arrived, I believe it was March 2 1st, 
is that correct? 

A I arrived on the 31st but it was very, very late. 

2 All right. So on April 1st, then, of 1986 is when 
you met with Ambassador Iambs? 

A Right. 

S At the beginning? 

A Um-hum. Let me just check my chronology, okay? 
Right. Well, actually no. It was March 30th that I had 
left for Costa Rica and March 31st that I met with him. It 
was Easter Sunday was the day that I left. 



UNCUSSIFIED 



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NAME: 
797 
798 
799 
800 
801 
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80S 
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815 
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UUOLnwoii iLU „^, 



HIR168000 Vi»Vtai»W'^-- •— pjQj 33 

fi knd aitar Anbassadoi — stzlKa that. 

A Yas. it was dafinltaly Hatch 31st that I had spoken 
with hin. 

S Uh«n you first anterad the roon''p>ere Anbassadoz 
Tanbs was, who else was in the zoom with you? 

A The three agents who were with ne . That was it. 

2 Hr . Currier. Hr . Kiszinski, and who else? 

A The legate. The FBI legate out of Panama. 

fi And you four were alone with Ambassador Tambs? 

A For about 20 seconds maybe. That was it. 

2 And after you began to brief with Hz. Tambs, 
Ambassador Tambs, and showed him the chart, he called for 



had what comments to make about 



A Right. 
S And] 
Olivez North? 

A nay I zafer to my notes? 
2 Suze . 

A I'm zefezzing to my notes made Hazch 31st, 1986, 
duzing my convezsation withi 

NR. HcGOUGH: Excuse me foz one second. 
(Discussion off the zecozd.] 
BY ns. KAUGHTON' 
fi Hz. Feldman, if you could zefez to^^^^^^^^^^ as 
Hz. Castillo, we would appzeciate it. 



iciAssra 



209 



NAME 
822 
823 
82'4 
825 
826 
827 
828 
829 
830 
831 
832 
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SKO 
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BHH 
8M5 
8M6 



HIR168000 



yNCliSSIFIED 



PAGE 3U 



A I can't do that. 

e Bacausa that's tha only nana you know him by? 

A That's tight. 

S Lat's just xaiax to him as^^B than, £or the 
purposes-- 

A Fina. 

S Hhat did^^lsay about Oliver North. 

A Told na that he was 




He said that John Hull — 

(nr. Silber conferring with the witness.) 

THE HZTHESS: Are you asking me speoiiically what 

Itold ma about Hr . North or — 
BY HS. NAU6HT0N> 

e Right. 

A — specifically what ha told me in general? 

2 About Oliver North. 

A The only thing that I recall! 



UNCLASSIFIED 



210 



NAHE> 

8U7 
8*48 
8>49 
850 
85 1 
852 
853 
85*4 
855 
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857 
858 
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860 
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863 
8614 
865 
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870 
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\\\\n hx^\ 




HIR168000 li;il8i VMiiBllll ll_LI PAGE 35 

tftlling — oi^^^HtAlling aa about Olivar Morth was that Oliver 
Korth had introduced hin.^^^H to tha President oi the 
United States the weeK before my visit, and that--let ne just 
go down here to double check. 

He also told me that John Hull knew Oliver Korth and knew 
Rob Owens. I remember that. That was essentially it. 

2 Okay, Mr. Feldman, those are the questions I had in 
terms of preparation for you. 

Upon reflection after your last deposition and in the 
light of any subsequent events, is there anything that ue 
haven't asked you specifically but that you feel that the 
committee should know about? 

A Ho. 

nS. KAUGHTON: I have to leave, but I will do so 
quietly, and if you want to start your questions, just go 
ahead. 

nx. HcGOUGH: I just have a few. 

EXAHINAIIOK ON BEHAIf OP THE SEHATE SELECT COHniTTEE 

BY HR. ncGOUGH: 

fi In reviewing your deposition I was a little 
unoertaln and I'm still a little bit uncertain when you 
first heard the name Oliver Horth. 

A Very early on. 



yNCLASSIFIED 



211 



NAME: 
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874 
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HIR168000 



mmm 



PAGE 36 



. ' fi Oo you remember izom uhon you first heard the name? 

A No. As I stated previously< I believe it was irom 
a number of sources--the Jacqueline Sharkey Common Cause 
article, John Mattes, newspaper articles. That's 
basically--that ' s the best I can do. 

Q All right. And I believe you testified earlier 
that on Karch 14th you had a meeting with Mr. Kellner. 

A Ura-hum. 

S This was the first meeting you had with him is when 
he walked into the office and said, is anyone working on 
this — 

A Right. 

a --on this case? 

To the best of your recollection, at that time were 
you aware of the North allegations? 

A I would--let me check something here, please. 
I Pause . 1 

THE WITNESS: I would say that I was aware that 
allegations were being made against Oliver North as early as 
December of '85, and I make that conclusion on the basis of 
my notes from a meeting in December of '85. 
BY HR. McGOUGH: 

S In your meeting on narch lUth with Itr . Kellner and 
Ms. Barnett, I believe, to the best of your recollection, 
did you mention at that point a possibl« connection with the 



NCUSSIFIED 



212 



KAH£: 

897 
898 
899 
900 
901 
902 
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90tt 
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912 
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911* 
915 
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921 



HIR168000 



UNCIASHD 



PAGE 37 



Kational Security Council and Oliver North? 

A No. 

fi Why not? 

A Why? Because I didn't know. You know, all I--you 
got to understand that the only thing that we were working 
at that point was an alleged assassination plot. That plot 
was based on the testimony of Jesus Garcia. That testimony 
basically proved — well, with regard to your specific 
question, the answer is no; because at that point I had no 
reason to believe that Oliver North was involved in a plot 
to assassinate the United States Ambassador. 

S I believe you indicated that you had read the 
Common Cause article in the fall of 1985. is that right? 

A Right. 

2 Leading up to your first meeting with Mr. Kellner. 
do you recall reading any other press reports of NSC 
involvement or North involvement in supplying the contras? 

A I may have. X don't know. 

2 But you don't specifically recall any articles you 
might have read other than the Common Cause article? 

A Z had articles in a file. I really, I can't answer 
your question. 

e When is the first time, to the best of your 
recollection, you discussed the allegations about Colonel 
North with Mr. Kellner? 



UNCUSSIFIED 



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NAHE: 
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HIR168000 



UNCLASSIFIED 



PAGE 38 



A I imagine sometime around the time that I drew up 
th« charts. 

2 That would have been beyond before your trip to 
Costa Rica? 

A I would say yes, because I had the charts in my 
possession when I went to Costa Rica. 

And when you say allegations, let me say this to 
you. That I at that time had no specific evidence of 
wrongdoing on Oliver Horth's part. The only thing I had was 
an hypothesis and that was it. 

S I understood, and that.'s why X call them 
allegations, as opposed to anything more than that. I 
understand that what you had was--and correct me if I'm 
wrong. Uhat you had was someone somewhere in the chain of 
witnesses that you were dealing with mentioning Oliver North 
as being possibly involved in supplying the contras. 

Going to the April 4th meeting, you mentioned--! 
know we've been through the roll a few times, but you 
mentioned Hr . Kellner, Mrs. Barnett, Hr . sihAzi. perhaps Ilr . 
Gregory, nr . Lelwant part time. 

A Um-hum. 

fi Now looking, in "articular, at Hr . S^harf. do you 
recall whether he was there the entire time or were there 
points at which he was absent? 

A No . Hy recollection is that he was there the 



UNCLASSIFIED 



214 



NAME: 
947 
9U8 
9<49 
950 
951 
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953 

955 
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9614 
965 
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967 
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969 
970 
971 



HIR168000 



entice time . 



ONCLASSIFIED 



PAGE 39 



e Do you zemembec the time of day that meeting took 
place ? 

A It was late aitecnoon, somewhaze around 2:30> 
because my flight didn't get back until 1=00. 

Q Did it extend into the eacly evening? By early 
evening I mean iive to six o'clock. 

A I would say yes. 

8 To the best of your recollection, was Mr. Schari 
present at that meeting when Mr. Leiwant was present at the 
meeting? Can you recall them being in the room at the same 
time? 

A Yes. 

S You said it with soma emphasis. Do you have a 
specific recollection that Scharf was there at the same 
time-- 

A ^hari and Leiwant were in the room at the same 
time . 

2 How about Hr . Gregory? Can you place Mr. Leiwant 
and nr . Gregory in the room at the same time? 

A I don't think — I can't say for sure because I'm not 
sure if tlr . Gregory was there. 

S I sea. And Nr. Leiwant was only present for that 
one meeting, is that right? 

A Right. 



UNCLASSIFIED 



215 



NAME: 
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HIR168000 



HNMSSm 



PAGE 40 



Q So, if you were--that's all hypothetical. I ]ust 
want to say you don't have a specific recollection of 
Gregory and Leiwant ever in the room at the same time 
because you don't know if Gregory was there. 

A Right. 

S On how many occasions have you talked to Mr. 
Richards about this case or about any case? 

A I don't think I've ever spoken with Mr. Richards. 

2 When discussing the continuance, you said that you 
may have spoken to Mr. Richards about the continuance. 
You're not sure whether the call came to you or whether it 
came to Mr. Kellner. 

A I may have spoken to somebody at the Justice 
Department. The only reason I know of Hark Richards is 
because I know that's someone who Mr. Kellner and Mrs. 
Barnett have referred to. 

2 So to the extent you spoke to someone at the 
Justice Department, it would not have been nark Richards? 

A I don't know. 

2 Do you ever recall speaking to Mark Richards? 

A X have no recollection of speaking to someone at 
Justice who called himself Hark Richards. I just remember 
possibly speaking to somebody about the request for the 
continuance. Other than speaking to Joe Tafe, that was the 
only conversation I had with people at Justice. 



UNCLASSIFIED 



216 



Kussra 



NAME: HIR168000 V • » '' ■"■ PAGE Ml 



997 
998 
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1002 
1003 
lOOU 
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1011 
1012 
1013 

lom 

1015 
1016 
1017 
1018 
1019 
1020 
1021 



fi All light. Hell that was really going to be my 
naxt question. Hou often do you talk to main Justice at 
all? 

A I spoke with Joe Tafe two tines. Three times, 
maybe . 

2 Joe Tafe is uho? 

A He's somebody who oversees neutrality cases in the 
Department . 

2 So am I incorrect In assuming that a conversation 
with main Justice would have been a significant, or an 
unusual event in your career. 

A I wouldn't say necessarily unusually, just my 
correspondence with Justice want through my supervisors, 
except for Joe Tafe . 

2 Have you spoken to anyone at main Justice in the 
past two weeks? 

A Tom Boyd. 

2 Hhen was that? 

A When did we leave? Yesterday. 

2 Has that to discuss whether or not you were to come 
down here? 

A Right. 

fl And did you talk about the substance of your 
testimony at all? 

A Not really. I spoke with him I think two or three 



mmm 



217 



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HIR168000 



daiYs before that 



*tt/flffl 



PAGE 42 



C On the same topic? 

A Right. 

2 Other than Mr. Boyd on those two occasions, have 
you spoken to anyone at main Justice about--let's say since 
the time — 

A There's been a lot here. Carolyn Hable. Kimberly 
Allen. I mean there's been several people, but I've never 
sat doun and discussed the case with them. Actually, after 
my last deposition I went back and spoke to Tom Boyd. 

S Did a debriefing of soma kind? 

A Right. And we may have mentioned something about 
Leiwant testifying. That was it. 

S Have you spoken to Mr. Kellner about the case, 
about the investigation since--by the investigation I mean 
our investigation--since you testified here last in, I think, 
April? 

A Yes, but it was informally. There was no 
debriefing . 

2 What do you mean by infomally. 

A Ha just talked about our mutual experiences. 

fi Did you establish any points on which you 
disagreed? 

A Ko . As you know, before we came here we sat down 
and went through the chronology. 



UNCLASSIFIED 



218 



NAHE: 

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HIR168000 



yNCiASSim 



PAGE 143 



2 But to date, you haven't established any points on 
which you disagree with Mr. Kellner? 

A There are so nany points. I mean that's sort of 
a--it's not a fair question. 

Q I just mean as between you and him. 

A Okay. I can't answer that. 

2 I'm not asking you whether you ever disagreed with 
him, but whether you and he ever discussed over which you 
disagreed . 

A Hot disagreed. He didn't remember making, or 
deciding to refer evidence of the Boland amendment 
violations to Justice. 

S Hhen did you discuss that with him? I know you 
discussed it on April 11th, 1986, but when did you discuss 
that incident with him after that? 

A The Miami Herald ran an article on Memorial Day, 
the Monday the Memorial Day is celebrated, and there was a 
question as to why I did not put in my memo the chart 
concerning Oliver North. And that question was asked to Mr. 
Kellner and he stated that he didn't know why I left it out 
but that I had obviously done that. And then the following 
day, that Tuesday, Z went in and spoke to him, and it was at 
that time that I said, you know, you had made the decision 
to refer evidence of Soland amendment violations to Justice. 
I said so, you know, anything pertaining to the Boland 



UNCLASSIHED 



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NAME: HXR168000 



UNCUSSIHED 



PAGE 



414 



1072 

1073 

1074 

107S 

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108U 

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1088 

1089 

1090 

1091 

1092 

1093 

109<H 

1095 

1096 



anendment really was not going into that meno> number one. 
HuBber two > the memo itself did not concern theory. It 
concerned what we had. It was an evidentiary summary and 
the only evidence that I had about Boland amendment 
violations was Peter Glibbery's statement about John Hull 
getting $10,000 a month from the National Security Council 
and my treatment at the embassy, and all of that was in the 
memo anyway. So that was it. 

2 And did Mr. Kellner indicate that he did not 
recall that decision? 

A Ho. He apologized. He said he had forgotten it. 

fi Did he indicate that upon being reminded of it he 
remembered it? What I'm trying to establish is whether or 
not he recalled that event upon your-- 

A He just said he forgot it. Those were his exact 
words . 

S To your knowledge, did Mr. Kellner ever refer any 
evidence to the Justice Department regarding the Boland 
amendment? 

A I would think not because, quite frankly, we really 
haven't come up with any. The only evidence that we had was 
what I have previously informed you of, and that was sent 
oii to Washington June 30th. 

2 Your meeting on the 11th when flr . Kellner made the 
decision to defer to main Justice on the Boland amendment. 



Muz\m 



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I 1 1U 

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HZR168000 



INCUSSIFIED 



PAGE 45 



Did you agree with that decision? 

A Say that again now. 

Q Did you agree with that decision? 

A You know, all I was — the answer to your question is, 
I really had no feeling because it really wasn't right. We 
didn't have anything at that point, and if I had come up 
with something, you Know, maybe I would have felt something 
one way or another. But I wasn't told to just close my eyes 
to evidence of Boland amendment violations. I was just told 
that if I have evidence of Boland amendment violations 
that's going to be referred up to main Justice because 
they're the ones that should be handling a case involving 
allegations of that magnitude. That's their call. So, you 
know, quite frankly, it really wasn't right because we 
hadn't reached that point. 

A At that time did you suspect Mr. Kellner's motives 
in making that decision? 

S Not at that point. You know, as I said in the 
previous deposition, people by that time were already 
kicking around allegations, but X never went into meetings 
feeling that they had pre-decided things. You know, 
when — there was too much 'critical analysis of the points that 
I was raising, and I never got the impression that this was 
all a big plan and that they were going to stop. 

I'd be lying to you if I told you I didn't think 



uNcussra 



221 



HIR168000 



IINClASSlflEO 



PAGE 146 



about it or the possibility o£ it, but I had been never 
9iv«n any reason to believe it. 

8 You've testified both last time and this time that 
to the best of your recollection Mr. Kellner indicated to 
you that you should slow down your investigation. 

A August 29th was the only time. 

2 All right. I take that back, then. August 29th. 
Did Mr. Kellner ever indicate to you that main 
Justice wanted him to slow down the investigation? 

A No. 

2 Whether or not he, himself, wanted to do that, that 
he never relayed that feeling from main Justice to you? 

A On nay 20th, the only message I got from Leon 
Kellner is that he wanted to be careful and he wanted to 
make sure that the right thing was done. That was the only 
message that I got. 

2 Does this confusion about the number of trips to 
Costa Rica, and I know you've testified that you only went 
once--to your knowledge, did anyone else in the Department of 
Justice or the FBI ever make a trip to Costa Rica to 
investigate anything in regard to what you've called the 
Costa investigation? 

A I have no knowledge of that. The only person I 
know who made two trips to Costa Rica within close proximity 
of each other was John rtadison. 



UHCUSSIFIED 



222 



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NAME: HIR168000 V|lW»-»»'^^ PAGE 47 



11147 
IIMS 

1 mg 

1150 
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11SM 
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2 You mentioned trips to Fxeepoxt and Key West. 

A Um-hun. 

2 And you said it was in relationship to cases. Were 
either of those trips in relationship to this case? 

A Ko. 

2 You said Mr. Leiwant came to see you the day before 
he came to Washington to testify. 

A Right. 

2 Can you tell ma what ha said and how that came 
about? 

A He wanted to know — ha knocked at my door, I said I 
didn't want to speak to him. Ha said, all I want to talk to 
you about is the proceedin'gs--actual procedure that you all 
utilize. And I said, if you want to know that, you go speak 
to Anila Barnett. I said, I don't think it's proper for us 
to be speaking. I said, I think it creates the appearance 
of impropriety, and I ended the conversation. 

2 I think you indicated to Pam that Hr . Kellner may 
have told you that Larry or Dick remember Kellner saying 
something like go slow and be careful. 

X Right . 

2 And some standard instructions like that. Can you 
ilAih that out a little bit? I mean, in what context did 
Kellner raise that with you? Has that in your discussion 
leading up to these depositions, or how did that come up? 



HHtmsro 



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yNEUSsro 



HIR168000 III^IBI miUII Ibt/ PAGE US 
. ' k I read a newspaper article that quoted a source as 
saying that there were two Assistant United States Attorneys 
who overhead Mr. Kellner make that remark to me. Up until 
that time I had only known of one person and that was David 
Leiwant, so the second was a complete surprise. I was in 
Kr . Kellner's office for some reason and I mentioned to him 
the ;irticle, and he said he saw that. And I said, do you 
know who the second person is? And he said, it may be Larry 
or Dick. One of then may have overheard me say something 
about--well/ you know, go slow, be careful. That's the only 
thing that I recall. 

8 And go slow, be careful was in the context of 
standard instructions in any investigation, to be careful 
and not rush? 

A Uell,yes. Right. 

S Did he indicate when Larry or Dick recalled him 
saying that? 

A Ko. 

2 Did he indicate whether in fact he knew that Larry 
and Dick said that or whether this was just his speculation 
as to who the second person might be? 

A It was more he answered my question in a 
speculative manner. 

HR. ncGOUGH: That's all I have. Tim? 
MR. BUCK: I have no questions. 



UNCLASSIRED 



224 



Dwssra 



NAME: HIR168000 1 1 1 llJl-flV'*' ' " PAGE 49 



1 197 
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HR. HcGOUGH: Thank you. 
[Whereupon, at 2=15 p.m., the deposition was concluded.) 



mm^^ 



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UNCLASSIFIED 



SELECT COMMITTEE ON SECRET MILITARY ASSISTANCE 

TO IRAN AND THE NICARAGUAN OPPOSITION 

UNITED STATES SENATE 

AND 

SELECT COMMITTEE TO INVESTIGATE COVERT 

ARMS TRANSACTIONS WITH IRAN 

U.S. HOUSE OF REPRESENTATIVES 

Tuesday, August 11,-1987, 
Washington, D.c. 
Deposition of DAVID C. FISCHER, taken on behalf of 
the Select Committees above cited, pursuant to notice, com- 
mencing at 10:15 a.m. in Room 901 of the Hart Senate Office 
Building, before Terry Barhara, a notary public in and for the 
District of Columbia, .when were present: 
For the Senate Select Committee: 

W. THOMAS McGOUGH, Esq. 
For the House Select Committee: 

THOMAS FRYMAN, Esq. 
SPENCER OLIVER, Esq. 
KENNETH BUCK, Esq. 




For Senator Orrin Hatch: 



DEE BENSON 



Partially Declassified/Released on 



1-23 



under provisions of E.G. 12356 
by N. Menan, National Security Council 



oofSNak. 



HUO HCKMITWa CO.. MC. 
)07 C Suwt. N E 
Vailuii(toil O C 20002 
liO:) M6-MM 



UNCLASSIFIED 



artl29 



mtjjik RCPOimNa co.. inc. 

S07 C Saret. N.E. 
Vuhiniioii. DC. 20002 
(2t .) >46-MM 



UNCLASSIFIED 



For the deponent: 

CHARLES R. WORK, Esq. 
McDermott, Will & Emery 
1850 K Street, N.W. 
Washington, D.C. 20006 



CONTENTS 
Examination by 

Senate Select Committee (Mr. McGough) 

House Select Committee (Mr. Fryman) 

House Select Committee (Mr. Oliver) 

House Select Committee (Mr. Buck) 

Counsel for deponent 



EXHIBITS 



Fischer Exhibits 
1 thro' 4 
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wmsm 



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UNCUSSIRED 



whereupon, j 

DAVID C. FISCHER 
was called as a witness and, having first been duly sworn, 
was examined and testified as follows: : 

EXAMINATION BY COUNSEL FOR THE 
SENATE SELECT COMMITTEE 
BY MR. McGOUGH: 

Q Mr. Fischer, I'm Tom McGough from the Senate Select 
Committee. If you have any questions about any of the 
questions I ask you, just stop me, and let me clarify them 
for you if they might be confusing. 

A Okay. 

Q I'd like to get a little bit of background informa- 
tion before we begin. Could you tell me how you are currently 
employed and what your business address is. 

A Currently, self-employed, under David C. Fischer & 

Associates, with an address now of flBV — no, that's the old 
address — of ■■■■■■■■■iH^IH^^Bk-in Vienna. Now that is 
just — that's a mailing address. That's my home, and I've got • 
an office there, but, you know, I do the work downtown. But j 
that's officially where the corporation is listed. J 

Q Did you say you do have an office downtown? j 

A Yes . ! 

Q All right. And where is that office located? 

A I kind of split my time between — actually, at Mr. i 



IJUM »oc»c'cn 



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Work's office is where they're preparing an office, and so I 
kind of office hop until the permanent facility is available. 

Q And where is the permanent facility going to be? 

A At aafe-K street. Suite 500. And I also still have 

A 

access to an office at IBC, which is Rich Miller's firm at 
1912 Sunderland Place, Northwest. 

Q What's your date of birth? 

A 

Q And your Social Security number? 

A 

Q 

A 

Q 

A 

Q 

A 



You're married, is that correct? 

Married, with three children. 

Could you give me your educational background. 

You bet. Starting with high school? 

Yes. Why don't we start there. 

I graduated from Salinas High School, Salinas, 
California, in 1966. I graduated from Hartnell Junior 
College in Salinas in 1968. I graduated from California 
State Polytechnique, San Luis Obispo, California in '71. I 
graduated from J. Rubin Clark Law School of Brigham Young 
University, Provo, Utah, in 1976. 

Q Were you continuously a full-time student from high j 
school until you finished law school, or did you take time off! 
to work? I 

A There was a brief period where I took a little time 



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off, I think about a semester. 

Q And where did you work during that semester? 

A I was working with a citizens group in Salinas, an 
agricultural group. 

Q And could you put an approximate date on that? 

A Let me see. I want to say early '70, I think is 
about when it was . 

Q When you finished law school, what was your first 
employment? ' "■ 

A While I was still in law school I was working for- 
I think it was called Citizens For Reagan, whatever Reagan's 
Ccunpaign committee was, and that continued until the conven- 
tion, Kansas City convention in '76. And after that I did 

consulting work for Deaver and Hannaford. 

! 
Q Is that Michael Deaver? | 

A Mike Deaver and Pete Hannaford, right, which was { 

Reagan's, Ronald Reagan's office in Westwood. In January of | 

1977, I went to work for Orrin Hatch back here. | 

Q Let's stop there for a second. What was your ! 

assignment with the campaign? I 

! 
A The campaign? Was advance work. 

Q Advance work? 

A Yes. 

Q And this was all the way through the convention? 

A Yes, up until the convention, and then there was a 



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UNCLASSIFIED 



small group of us who continued with him as he travelled in 
support of Republican candidates. So what we would do, we 
would just divide the trips up. 

Q In 1977 you went to work for Senator Hatch hereJLn 
Washington? 

A Yes, and then, in his Utah office. 

Q And what were your positions there? 

A You know, I don't even know what the title of the 
position was. Constituent relations, primarily, and public 
relations, and then I went out to Utah to help set up his 
Utah operation. 

Q How long were you employed by Senator Hatch? 

A I think it ended in the summer of '77, and then 
started with Deaver and Hannaford on a consulting basis, 
going full-time with Deaver and Hannaford in about January of 
1978. 

Q What were you doing for Deaver and Hannaford , 

A Deaver and Hannaford described the position as 
executive assistant to Ronald Reagan. I worked strictly on 
Reagan's account. Reagan was their number one client, and 
the responsibilities there included planning his worldwide 
travels, handling what you'd call the advance scheduling 
operation and security, and also, travelled with him wherever 
he went, and some work on handling — you know — some of the PR, 
the correspondence. And then, as we got closer to the 



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campaign I got involved in the strategic planning for his 
1980 bid for the presidency. You know, some press relations 
and-- 

Q Your official title was executive assistant to the 
President and at that time — 

A Executive--to Governor Reagan. 

Q I'm sorry. To Governor Reagan. Excuse me. Did 
that title change at some point, or did you maintain that - 
title continuously through the 1980 election? 

A Well, that's, you know, that's the title that I 
had. When we became a campaign, I continued in the same 
function. I mean, people kind of — you know — I believed that 
was still the title. That the job at that point got a little 
more refined. Now we had Secret Service on board, so I no 
longer had to worry about security even though I was the 
liaison for the Secret Service. 

And at that point I became more helping to run the 
advance operation, scheduling operation, and I spent a lot 
more time on the personal aide role. We went from a very 
tiny operation at Deaver and Hannaford to a full-blown 
campaign, so we had a lot of support staff. 

Q How did you first become connected with the Reagan 
campaign? 

A I'll do this quickly because I have a tendency, as 
you know, to very long answers. My last year up, \fivi school. 



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I wrote to — I'm trying to think of who ran Ford's campaign — 
Bo Calloway, and expressed an interest in working for the 
Ford campaign. 

As I recall, X got a form letter back saying this — 
you know--we're working under the first Federal election 
laws, and restricted money, we already have our staff picked, 
thank you for your interest. 

I flew back on my own and started knocking on 
doors, trying to get into Calloway and other people, and I 
spent about three days trying to see if I could find a spot 
on the national staff. 

I had no luck, and then, just before I went to the 
airport, I remembered a fellow that used to work for Russell 
Train who was head of the EPA, Mike Scanlon, and I had 
assisted Russell Train in California about a year before. 

So I went over to see him. He was working a lot in 
the advance operation. To make a long story short, he 
offered me a job, a paying job to start in January. 

Q He was working the advance operation with Ford? 
A He was with Russell Train, you know, as his 
executive assistant, but on the side, all of these people get 
involved in politics, and so he was out doing advance work on 
the side for President Ford. And he offered me a position as 
an advance man. 

In the course of the conversation we talked 



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politics, and he knew I was from California, and I told him 
Reagan — you know — was my favorite candidate, even though it 
didn't look, like Reagan was going to run for sure. 

He called back some time later, said Reagan was 
going to run. My roommate, Paul Russo, he's going to be 
running the Northeast effort for Reagan, and, if you want to 
make a switch, I'll make the introduction. And so I went 
from a paying position at that time, to a "freebie" with 
Reagan, and he introduced me to Russo, and I believe it was 
January of '76, I went to New Hampshire, and started working 
in that primary, and then eventually got a paying position 
with him. 

Q Now after the 1980 election, and the inauguration, 
you assumed a position in the White House, is that correct? 

A Correct. 

Q And what was the title of that position? 

A Special Assistant to the President. You know, they 
have rankings. That's the rank. The job description would 
be best described as personal aide to the President. 

Q And did that job description and title remain the 
same throughout your tenure at the white House, or did it 
change? 

A I'd say it remained the same. 

Q Can you give me a general description of your 
duties as Special Assistant to the President. 



jiMcussrEn 



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10 



Yes. A lot of it was continuation of the things 



that we had done before. It was working with the people that 

i 
handled his scheduling and advance operations, and my i 

I 
inunediate superior was Mike Deaver. And it was one of a I 

daily working relationship with the President. I 

I 
I would meet him in the residence in the morning, | 

i 
we'd walk over to the office. We'd go over what was going to 

happen to him that day, make sure that he was up to speed on I 

the meetings. If there were any questions about what was | 

going on I would get the answers for him. 

And then, as the day progressed, it was one of 

1 
staying with him throughout the schedule, making sure that I 

meetings took place when they were supposed to, the people i 

coming into see the President were--that he was briefed i 

properly, and also, that the people were briefed as to what i 

was to transpire, and the time limits. 

And even though — and in most of these cases — every 
appointment has an action officer — it could be an assistant 
to the President for public liaison, or it could be national 
security advisor — they had the primary responsibility for 
writing briefing memos, and they were really responsible for 
the meeting. 

But a lot of times it was making sure that (a), 
that everything on the schedule happened as it was written, 
and also one of keeping track of what did happen. If there 

UNCLASSIF'iD 



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were changes in the schedule, I would make the notatiorf^abn 
his schedule, and, just for the record, and those notes, 
what I would do, though, was take my schedule, put down who 
was at what meetings, and the timeframe in which each meeting 
took place. 

And that kind of activity went on wherever we were. 
It continued when I was a liaison to the Secret Service. I 
travelled wherever he went, whether it was Camp David, or out 
to California, or, you know, overseas, and I was a link a lot 
between the staff and the President. 

Q Were you involved at all in substantive policy 
issues? 

A No. 

Q Where was your o££ice located? 

A Right next to the Oval Office. 

Q You mentioned that you took notes, or kept a daily 
log or diary. 

A What I should say, not notes. For instance, on a 
notation--every day at 9:30 there was a national security 
briefing time. All it would say is "national security 
briefing." What I would attempt to do is keep a log of who 
went in there, and so that archives would know that, you 
know, on this day, the following people met with the Presi- 
dent . 

Now, a lot of times, on meetinas, the action 



» lot or tunes, on meetings 



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officer, whether it was NSC for, say, for instance, a 

National Security Council meeting--I of course didn't go to | 

those--they would have somebody in there who would take the I 

invitee list, and check off who was there, and make any I 

I 
additions, and they would just turn those in to me. I would I 

I 
staple all together, at the end of the day, all these notes, | 

and would shoot them into archives. I 

I 

Q And they would still be in the White House archives?! 
You didn't take those when you left? | 

A They would be in the White House. They were turned 
over every day to Dick Darman. 

Q Did you take substantive notes during meetings with | 
the President? j 

A No . I did not . ; 

Q What would happen--for instance, say, a National i 
Security Briefing would take place. That would happen in the i 
Cabinet Room, generally. { 

A What I would do is when everything was set up in | 
th« Cabinet Room, and they were ready, I'd let the President 
know — you know--they're ready for the meeting. Now many 
times he would be briefed ahead of time, maybe Shultz would 
be with him, or somebody, and X would just say, "They're 
ready whenever you are . " 

And they would go in, and I would stay in the room 
if — maybe there was a photo op going .fl;\^- just to get the 



was a photo op going on--- 

ilMfillSSIF^Q) 



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press in and out, and once all the non-participants were out 
of the room, I would exit also. 

Q when did you leave the White House? 

A Early April 1985. 

Q And where did you go from there? 

A We moved to Farmington, Utah. 

Q And did you take a position there? 

A Yes. Senior vice president with Huntsman Chemical 
Corporation. 

Q What were your duties there? 

A Public relations, government relations, and then a 
lot of it turned into work with employees . He was in 
acquisition mode at the time, so I would spend a lot of time 
traveling to different plants working with employees, working 
with unions. 



You said "he was in an acquisition mode." Who is 



he? 



A Mr . Huntsman . 

Q Could you give me his full name. 

A Jon, J-o-n. I think his middle initial is M. 
Huntsman. H-u-n-t-s-m-a-n. 

Q He is president of Huntsman Chemical? 

A Chairman and president. 

Q How long were you with Huntsman Chemical? 

A From April until the following April, and then, 



[JNCLASSIF!ED 



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after that, he became a client of mine. 

Q And in April of '86, what happened? 

A In April of '86 I switched from a full-time 
position with him, and Jo^n became a client, or his company 
became a client, and I started operating — I had actually 
started operating before that under David C. Fischer and 
Associates, had my own consulting business. 

Q Was that a sole proprietorship, or a corporation? 

A It was a corporation, Utah corporation. 

Q When was it incorporated? 

A I'm just guessing. January of 1986. 

Q And is it still a corporation? 

A Still, yes. It has not changed at all. 

Q And are you the sole owner of David C. Fischer? 

A Well, you know, I'm an officer, my wife's an 
officer, but it's just basically David Fischer. 

Q Other than your wife and yourself, is anyone else 
an officer or a stockholder in David C. Fischer and As- 
sociates? 

A No. 

Q When did you first meet Martin Artiano? 

A The best I can remember meeting Marty was in the 
1976 Reagan campaign. When, exactly, I don't know. I would 
say early 1976, and he was an advance man, as I was, and a 



San Diego attorney. 



UNCLASSIFIED 



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Q Is it fair to say that you remained in touch with 
him through your tenure at the White House? 

A Absolutely. Yes. We are very close friends. 

Q Prior to leaving the White House, did you ever have 
any professional relationship with Mr. Artiano? 

A Professional as in business? 

Q Any business ventures, or — 

A I'm trying to think if we did anything after '76. 
I don't believe so. I'm just trying to go back through all 
my — where I've been with Deaver and Hannaford. No, I don't 
believe there was. 

Q So up to the time you left the White House, there 
was no commercial aspect to your relationship with Mr. 
Artiano? 

A Oh, no, no. No. No. 

Q When did you first develop a professional relation- 
ship with him? 

A I'm going to say late, like December 1985, probably. 
I had had a conversation with Marty, early on, when I knew 
that I was going to make this transition with Huntsman, that 
I was very interested in securing clients here in Washington, 
and, you know, I would put that late '85. 

Q And how did that professional relationship begin? 
I mean, what was the first stage in it? 

A The first stage? Well, it was, you know, just 



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talking, and he would tell me about the kind of clients that 
the law firm had, and that there were occasional matters that 
they would refer to other people, that would be non-legal in 
nature, and those are the kind of things we talked about. 

Q Now by that time, David C. Fischer and Associates 
had been incorporated? 

A Or close to it. I believe it was January of '86. 

Q Of '86. What kind of professional consulting 
services were you offering at that point? - - 

A The kinds of things that I always talked about with 
Marty was public relations/public affairs. You know, this 
whole area of what they call strategic planning, and also 
helping companies, or entitles solve their problems. 

Q Their problems in relationship to the Government? 

A Somewhat the Government, and others, non-related to 
the Government . 

Q Did it include in your own mind executive liaison? 

A Oh, sure. 

Q There was a time, was there not, when you were 
part-time in Washington and part-time in Utah? 

A Yes. We moved here in March of this year. 

Q And in the latter part of 1985, were you staying 
with Mr. Artiano when you came to Washington? 

A Yes. 

Q How often would you stay with him? 



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A Generally, whenever I came to tovm. 
Q How often would that be? 

A It kind of varied. I mean, there were periods when 
I wouldn't come here for several weeks. There were time 



5 ll periods, that I would come out for, you know, several weeks 



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in a row, and stay probably an average of three days a week. 
It just varied. It just depended on what was going on. 

Q Over what period of time did you find yourself 
staying at his house? 

A Until we moved here with the family. 

Q And that would be in March of 1987? 

A March of '87. Correct. 

Q Was there a time when you lived here full-time, or 
did you always split time with Utah? 

A Oh, no. I always split time. Utah was home. We 
were out there for--we stayed for personal reas 




Q Did you also use Mr. Artiano's office for your 
business? 

A Yes. Matter of fact, what I did, on David C. 
Fischer and Associates, for a Washington base, I had a 
business card printed up, David C. Fischer and Associates. 



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listed 1708 New Hampshire as a business address, and had a I 

private line, that when you rang the line it was answered, | 

"Mr. Fischer's office." j 
Q Who would answer, "Mr. Fischer's office"? 

A Marty's secretary, or whomever was — or the recep- j 

I 

tionist. I 

Q Did you ever discuss that arrangement with anyone | 

else at Mr. Artiano's office, other than Mr. Artiano, and his | 

i 

secretary? " -. j 

! 

A You know, I don't know that I did. I only can, | 

sitting here, assume that Marty did, because he would have | 
had to have permission for something like that. So I can 

only assume the other partners knew that, because we ended up i 
participating in clients together. So I can only assume that 
they knew. I don't recall ever having discussions with them, 

but they were certainly aware of the relationship. i 

Q Other than business cards, were there any other | 

professional announcements, or indications of your presence? I 

A No. You know, stationery printed, but no announce- I 
ments, if I remember, at all. 

Q But there was stationery printed with that address 
on it? 

A Yes. 

Q Was there any sign on the door, or outside? 



No. 



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Q Over what period of time did you use his office? 

A I would say that I would use that office until — I 
would say about July or August of 1986, right after I signed 
that association with IBC, and it was after that time--it was 
after we got involved with the Aquino thing, that I actually 
started using an office, a temporary office. 

And after the Aquino visit, a permanent office was 
set up for me at IBC, and then there was no occasion to use 
Marty's office after that. I would still have meetings "over 
there on other client matters, but that then became a base of 
operation. 

Q Did you pay Mr. Artiano's firm anything in the form 
of rent or overhead, allocated overhead, or anything like 
that? 

A No. 

Q Did you pay for the private line? 

A No. There was no separate office dedicated to me. 
It was, you know, use of Marty's office, or a conference 
rooa, or whatever happened to be available. 

Q Did you use his secretary to do correspondence, and 
that sort of thing? 

A Yes. 

Q At any time in your relationship with Mr. Artiano, 
did he ever act in the capacity of an attorney to you? In 
other words, do you contend that there was an attorney-client 



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relationship at any point in your relationship with Mr. 
Artiano? 

A You know, I'd have a hard time answering that 
because I'm not so sure-- 

MR. WORK: I think the answer probably is yes. 

THE WITNESS: I would think it would be. Marty — let 
me give a long answer to try to describe the relationship. 

In the business relationship, Marty and I would 
discuss pending business opportunities. He would find some, 
and say, would you come over, I've got something to talk 
about. I would find some, and I would include him in on it, 
and I can give you an example where I really considered him 
an attorney, if you want a quick explanation of that, and 
this is kind of typical of what we did. 

A German industrialist friend of mine had called in 
late '85, and said he had a British citizen that had a 
business problem, and would I be willing to meet, and that's 
as Buch as he said. Based on his recommendation I said yeah, 
I'll Beet with him. I asked Marty to sit in on the meeting. 

We had the meeting in Marty's office. The guy gave 
me a business card in which he said he was an executive with 
some oil entity. He said he represented a consortium of 
English and European businessmen who did business in Africa, 
and they had a serious problem. 

It took us a long time to figure out that what he 



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was really doing — that he did represent a business entity but 
the government was Angola, and at this time Angola was having 
very serious problems with the US . And what he wanted was to 
help in media work, and strategic planning, and improving the 
relationships between these two governments. 

But he said, you won't be representing the govern- 
ments, you're going to be representing us and the businessmen. 
We're going to pay the money. We're setting, out of our oil 
proceeds, and other businesses, we're setting up a fund in 
order to pay for this PR effort. 

When I found out that the client was really Angola, 
I told him I was not interested and gave him the reason why I 
wasn't, that this was a government that was on, you know, the 
Reagan Administration's "hit list", and that it was an 
unpopular government, and that, frankly, if they were sincere 
in their desire to improve relationships, they know how to do 
that. 

And if they needed to be reminded, I would set up 
whatever meetings they needed to help have the government 
explain, our government tell them exactly what they had to do 
to improve relationships. 

And he asked for recommendations on other firms, 
and I told him some other people. They already had, I think. 
Gray and Company, someone involved at that time, but I 
basically said I was not interested because of the govern- 

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ment, and Marty concurred in that. And then he told us how I 

much he was offering which almost made me want to reconsider, j 

He offered $1 million a year for two years, the first year up j 

i 

front, and I believed him. I 

He also had a second business card that he gave to 

me, though, that identified him as a special advisor, or | 

something, to the oil, or the energy minister of Angola. I 

Anyway, that's the kind of relationship. j 

I 
If something would come to me, I'd call Marty, "and 

I wanted him there as a witness because I didn't know what was j 

going on, and he concurred with my judgment on that one, and i 

we were not interested in that kind of client. ; 

There were other kind of deals that he would bring 

in, business entities, corporations, that he would — you know, 

I would sit in a meeting with whoever the client might be. j 

They would explain their problem. Marty and I would meet | 

later on, talk about the pro's and con's, and decide whether | 

or not we wanted to assist. i 

So if that encompasses attorney-client — | 

MR. WORK: No, that doesn't. j 

THE WITNESS: I don't think that does. | 

MR. McGOUGH: We may be able to clarify this very j 

quickly, and I'm obviously trying to find out if we're going j 

to run into any privilege problems vis-a-vis Mr. Artiano and 

Mr. Fischer, and that's probably better addressed to you. i 



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Are you aware of any? 

MR. WORK: I don't anticipate that you will run I 

into any privilege problems. I do know of one particular j 
piece of advice that the firm gave to David, and as far as I'm| 

concerned we will probably waive privilege on that, but the i 

precise answer to your question, did they ever operate as a j 

lawyer to him is yes. , 

! 

It wasn't very often, but they did. \ 

i 

BY MR. McGOUGH: " j 

Q To close out this line of questioning, did you ever I 

pay Mr. Artiano's firm for legal advice? | 

A The answer to that would be no. i 

Q And any payments that you made, or any--let me take , 

that up as a subset of the next area. That is, what were the i 

financial arrangements between yourself and Mr. Artiano? i 

A It would really — it would depend on the client at 

the time. We had some clients in which the arrangement i 

between the client would be directly with David C. Fischer i 

and Associates, in which payment would come to me, and then I ! 



would write individual checks to members of the firm. 
There were other times when there would be-- 

Q The firm being David C. Fischer and Associates? 

A No, meaning some of the fellows at the law firm, 
more than Marty. And there were those, where there would be 
Marty, and two others, that were involved on other clients. 



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Q Why don't you identify them for the record. \ 

A One of them was COMB, and I don't know what it j 
stands for. It's C, period, 0-M-B. They're the liquidator j 
company, the one that does that catalog, the mass-mailing i 
catalog. 

Q I'm not talking about the clients that generated i 
the fee. What I'm talking about are the people with whom, at i 
Mr. Artiano's firm, with which you shared the proceeds. 

A I'm sorry. You mean the other attorneys? j 

Q Correct. i 

A Bob Davis, Robert Davis, and Steve Nauheim, and I 
think it ended with those two. Yeah, I believe that's right. 
Just Steve and Bob. 

Q So is it fair to say that each client who came to 
you, which generated a fee, there would be a separate i 
agreement or understanding with you and Mr. Artiano in regard i 
to that particular client? 

A Or, you know, the group, or other guys in the firm. 

Q Let's turn, if we could, then, to IBC, International 
Business Communications. What was your first contact with 
IBC? 

A I think my first time, that I ever met Rich--now I 
may have met him in a campaign. I don't recall him at all. 
The first time, I believe I met Rich, was probably in 
December of 1985, and he was introduced bv Marty. Rich had 

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worked in the campaign, but since I was on the traveling 
staff--he worked for Nofziger, and I just don't think that I 
ever met him. 

Q Do you recall the actual meeting in which your 
first contact with IBC took place? 

A No. I don't. 

Q Who did you meet at IBC at that time, or, in the 
initial stage? 

A Well, it would have been Rich Miller and Frank 
Gomez, the two principals in the firm. 

Q What did you understand IBC to do? What was it's 
line of business? 

A I knew they were a public relations firm with a 
real heavy emphasis on media work, public affairs--you know-- 
just a general Washington, D.C. PR firm that was--you know-- 
had been in existence for a couple years, and were an "up and 
coming" firm. 

Q How did their line of business differ from David C. 
Fischer and Associates? 

A I would say that it probably differed in just, you 
know, the capabilities, and then there was — I was a lone 
operator, and they had a staff of I don't know how many 
people working there, plus they had an office with all the 
things that go along with an office. You know. Secretaries 
and telephones, and FAX machines, and LEXIS/NEXUS, and, you 

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know, research staff. All the kind of things that if you're 
going to work on a wide range of things, you know, the 
support staff that you really need. 

And so I would say that's one of the great differen- 
ces. As far as the kind of capabilities, and that, I would 
say most people in these kind of firms all do the same thing. 
Some people have specialties. You know, you may be a 
Congressional expert. You know, you may be just a media 
expert, but, I would say they encompassed about all of Chose. 

Q And was there anything that you offered, that IBC 
did not? 

A Yes. I think what I offered to IBC was a different 
range of experience that--and background, that they didn't 
have. 

Q Could you be a little bit more specific. 

A Yes. You know, Frank's specialty was more foreign 
affairs, having served at — I don't know if he was USIA at the 
State Department, but, you know, basically a State Department 
background. Rich had been AID, and had done a lot of media 
work with Nofziger, and I had understood other jobs that he 
had were very media-oriented. 

And my experience had been more heavy political, 
and a lot in more what I would call "strategic planning", 
whether it's image-building, public relations, and a very 



emphasis in campaign work. 



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Q We've talked in several of these depositions about 
"strategic planning" and I'm not sure I completely understand 
what it means. Could you be a little bit more specific. 

A Well, yes. Let me go back to that exeunple of the 
gentleman from England, where Angola had this supposed 
problem, or he says his businessmen. Well, their real 
problem was they were losing a lot of money, and, you know, 
to them it was dollars and cents. They didn't care about the 
political ramifications. 

What they were looking for is how do we take — you 
know--analyze this problem for us. How do we solve it? What 
do we do? What do we do in terms of media? What do we do in 
terms of the administration? How do we change the perception 
of that government, and what they're doing down there? 

And those are the kind of things where you sit 
around, and, you know, you do it by yourself, you think a 
lot, you strategize, you're sitting in a room with people and 
you brainstorm, and you try to come up with ideas on — once 
you've done the analysis, and realize the goals that the 
client has, where does he want to go. Then you say, okay, 
we're going to take the following steps in the following 
areas. 

This is what you've got to do in media. This is 
what we're going to do in Executive. This is what you want 
to do in Congressional. "Strategic planning" is a word that 



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is very much abused. That's how I understand it. 

It's trying to take the client's problems, or what 
he perceives as his problem, tell him whether it really is a 
problem or not, and maybe even to find out that his problem 
is really something else, and help him address that problem, 
and take positive steps to change it. 

And a lot of times it's nothing but perception 
problems . 

Q Would it be fair to say that, at least as far as 
IBC was concerned, what you brought to the table was your 
White House experience, and your familiarity with the White 
House procedure, and personnel? 

A I would say that's certainly part of it. I mean, 
you know, part of who I was at that time, and still am, is, 
you know, four years of experience in the Administration, and 
of understanding the processes of the Administration, and how 
the Executive Branch works, and how the Cabinet system works, 
and how the departments work. 

And certainly, that's part of it. But to me, it 
went well beyond that. I mean, understanding the process is 
a very valuable thing, but a lot of it also had to do with, 
you know, with what this small group of people were able to 
do with Ronald Reagan back in 1976 and 1980, in creating, you 
know, a national campaign that was highly successful. 

And you know, all of the media work that we got 



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involved in. And then, if anything, that was true strategic 
planning, and what happened with Ronald Reagan. 

Q When did you first come to an agreement with IBC to 
be a contractor, or to enter into some kind of business 
relationship with them? 

MR. WORK: There are a couple of agreements. 

THE WITNESS: That's why I want to go to the first 
one. 

MR. McGOUGH: You want to go to the written 
agreement? 

MR. WORK: And there's no written agreement. 

MR. McGOUGH: I understand that. Well, that was 
going to be one of my questions, whether it was reduced to 
writing. But what I want to do is, the point when you said, 
"Okay, we've got a deal," let's go forward, and that's where 
I want to start. 

THE WITNESS: When was the first time? 

MR. McGOUGH: Yes. 

THE WITNESS; The way this particular client was 
introduced to me was through Marty. Marty had had separate 
discussions with me and separate discussions with Rich 
Miller, and it seems to be that at about the time I told 
Marty that, you krow, we would soon — even though it turned 
out to be much later than we thought--we thought we'd be 
moving to Washington much sooner than we did — that I was 



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anxious to start setting up a base in Washington, and to keep 
his eyes open. 

At the same time that was talking place, Rich 
Miller, who, evidently he knew before, was talking to him 
saying "I want to take this business and really expand it, 
and would you keep your eye open for someone that you think 
would be a nice addition to the firm. " 

And from those discussions, we had a--you know--a 
get -acquainted session. There may have been more — and 1 
don't know how many there were--with Rich Miller and Frank, 
in which they told me about their business and where they 
were going to go, and their clients, and what their goals 
were over the next couple of years. 

When it ceune to coming to terms of what an arrange- 
ment was going to be, that was al handled by Marty, and, you 
know, precisely when it took place — you know--I'm going to 
say probably December of '85 — you know — would be my best 
guess. 

And he knew that I was interested in a long-term 
relationship, but what these guys wanted was — all these early 
discussions led up to a formalized agreement, and what they 
wanted was for me to become a consultant to them, and they 
were very anxious that I not affiliate with any other PR firm. 

In other words, please — you know — doing some work 
for Gray and Company here, and Deaver here, and those guys. 



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But they really wanted a, almost an exclusive arrangement on 
public relations, not on other matters. And again, I'm just 
trying to do all this from memory. 

And so I told Marty that what I wanted was a 
commitment that--you know--that we weren't going to start 
doing work for this client and have it be a one-month 
relationship, or a two month. That I wanted it permanent, or 
at least a long-term arrangement. 

And so he — you know — he kind of carried the ball 
back and forth. You know, I would have discussions with him 
and he would go talk to Rich, and, you know, a lot of this 
time I was back in Utah, and so a lot of this was done by 
telephone. 

And so we came to an agreement that Marty and I 
would become consultants to IBC in a long-term relationship. 

Q Now let's break down the agreement a little bit. 
What did you understand you were to do for IBC? And I 
understand this went through several different players, but 
let's just go back to the beginning. 

What was your initial understanding of what you 
were signing on to do? 

A The initial understanding was that I would help 
increase the capabilities of that firm, that they were at a 
certain level, and they wanted to greatly increase their 
base, and they were anxious to hf* ^ — Yl'WV " like me to be 



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affiliated with them, even though it was going to be on a 
consulting basis. And that they had in particular a client, 
Channell, and his organizations, that was a primary focus and 
concern to them at that time. 

And that while their client, IBC's client, Channell, 
had been doing a lot of work in support of the Administration, 
and had very good access to the Administration, Channell was 
not really getting the notoriety that I think he expected, or 
at least as explained to me, that he was doing all of these 
things, and yet, when someone would be interested by the 
media, as being someone in the private sector who was really 
out there influencing public opinion, or who was trying to 
educate the public on an issue, they would always call the 
Dick Vigueries of the world, or other people who had organiza- 
tions that were out there supporting conservative causes. 

And yet it was the feeling of Rich, and I believe 
Channell, that they were doing far more than anybody else. 
And yet, while internally within the Administration, par- 
ticularly the White House he was getting credit for it, it 
never transcended beyond. 

It was always, well, a few people knew what he was 
doing. He obviously had all these letters from the President, 
and letters from other people in the Administration, and they 
had all their meetings and that over there. It still wasn't 
transcending into anything that went beyond that, and I think 



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he wanted to become what I would call a "serious player" in 
Washington . 

And then they started describing, with their 
client, Channell, some of the different programs that they 
had, were in the process of doing, things they'd done in the 
past, and where they wanted to go in the future. Their whole 
Central American freedom program. Their commercials on 
balanced budget. SDI was a real big one, and one they were 
just getting ready to launch. Their Constitutional minutes 
program. I mean, obviously you guys have seen all the 
program work. There were a dozen programs at least, that 
they either had going, or were projecting into the future, 
and, the problem that I believe that Miller was having, is 
that he was having trouble keeping up with his client. 

In other words, his client wanted to propel so 
rapidly, and things just didn't happen quick enough for the 
needs of that client, and he just wasn't getting the noto- 
riety. He couldn't — I don't know how best to describe it. 

I can give you an example of one program, if 
that'll help, it's non-related, this one, and maybe that'll 
help. For instance, the Strategic Defense Program. 

Now in one of our early meetings with Channell and 
Miller, I said tell us who you are, show me all your commer- 
cials, give me all your paperwork. 

Q Let me interject for a second. Did you meet 

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Channell and/or Conrad before striking a deal, or coming to 
an agreement with IBC? Were they part of the initial 
introductory negotiation phase, or was it after the fact? 

A X just don't recall. To me, I believe that we met 
first of all with Miller. We eventually met with Channell, 
to talk to him about who are you, and, you know, when it 
happened, exactly, I want to say--again — some time in 
December, probably early December, and that's the best that I 
can recall, in which he was talking about his programs. 

And then in the process of getting all of this 
material--you know — I said give me your files, basically, and 
the kind of letters that you've got. Show me who you've met 
with at the white House. And as I'm going through these — you 
know — initiations that Channell had, and just talking to the 
SDI thing — he had just been invited, just within — you know, I 
think it was in November — to a Cabinet Room briefing on SDI. 

Well, the Cabinet Room's pretty small, and so to me 
that~you know — that told me that this guy is at least on 
sooMbody's list because he's being invited in for an SDI 
briefing, and the President's there. 

And so the frustration they're having with that is 
that they couldn't get a hook on exactly what the Ad- 
ministration's policy really was, and Channell knew what he 
wanted to do and where he wanted to go with the SDI Program. 
It just needed a little more direction. 

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So that kind of frustration was explained to me, 
and if you want, I'll just tell you the kind of steps that 
were taken--you know--through the ensuing months. 

Q We'll get to that. What I'm interested in is 
really the inception of the relationship at this point. 
You've talked about what you felt your role was to be, and 
what problems Mr. Miller and Mr. Channell were encountering. 
What was the arrangement struck with IBC as far as 
compensation, your compensation or David C. Fischer and " 
Associates' compensation? 

A Well, the compensation package that was arranged at 
that time was, as I recall, $20,000 a month, and I believe 
that started with in December. 

Q And to whom was that $20,000 a month, if we can call 
it a retainer, to be paid? 

A Well, because we hadn't — I was not incorporated in 
December, and so the initial payments — and I didn't have any 
bank accounts that were in that name, and so the initial 
payaents were made to Artiano. 

Q Now a portion of that monthly retainer was split 
with Mr. Artiano, is that fair to say? 

A Half of it was. 

Q Half went to Mr. Artiano and half went to you. Was 
that pursuant to an agreement you worked out at the outset of 
the relationship, that it would be 50/50? 



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A That was the proposal Marty made to me. 

Q Why was it divided in that fashion? 

A That's very typical in Washington. We had other 
business arrangements, or, I would take a much bigger share, 
and he and the other guys in the law firm would take — just 
every arrangement with a client was different, but the 50/50 
was pretty — as I understand it — was pretty normal in this 
town. 

And in fact the work--I mean, the labor on tills 
thing was to be split. 

Q In what sense? 

A And he was going to participate just as much as I 
was in the workload. 

Q Was he going to cut back on his law practice in any 
sense? 

A No, because a lot of — well, I can't say that he 
was. I don't think he was envisioning himself moving over to 
IBC. I mean, he enjoyed a very successful law practice. But 
a lot of what — a lot of the so-called "strategic planning" 
that we've been discussing here would take place between 
Marty and I, either at his office, and would extend into the 
evening at his residence. 

And so, you know, he participated very heavily, and 
he's the one that initially had all of these initial meetings 
to check out as much as he could before he ever came and told 



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me about who these guys were, particularly Miller. I don't 
know that he knew that much about Channell. 

Q During the course of this initial phase of the 
relationship with IBC, did you keep any time records, or did 
Mr. Artiano keep any time records? 

A I didn't. I don't know, Marty may have. I didn't. 

Q Was the $20,000 net of expenses? 

A No expenses were ever submitted. 

Q But was the initial agreement $20,000? 

A $20,000 a month, period. 

Q Period. That was to cover expenses from your 
standpoint, and Mr. Artiano 's standpoint? 

A Yes. Now of course, you know, we always had access, 
you know, if we needed lot of material run off, or if we 
needed some secretarial work. That could always be done at 
Rich's office, if that were required, and in fact a lot of 
the research and that, that was done, was done by his firm, 
particularly on things like SDI and that, and the other 
issues . 

So that part, you know, was paid for by Rich. 

Q There came a time in either late December, or very 
early January of 1985-86, when there were discussions about 
arranging a White House briefing and securing a presidential 
drop-by for that briefing. Could you tell me how that came 



about. 



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A Sure. In the course of reviewing who these guys 
were and checking them out, which I did very thoroughly, by 
going to the White House and talking to people, and verifying 
it in fact. I mean, I looked at the commercials, and I 
looked at the letters, and I looked at the meetings that they 
attended . 

And in the course of my investigation, I found out 
that I believe they had up to three briefings already, before 
I had met them, during 1985, and that I believe they were 
primarily Executive Office building meetings sponsored by the 
Office of Public Liaison, in which their contributors would 
come in, or just general supporters of their different 
organizations . 

And they would be briefed by — you know — whether it 
was Linda Chavez or Pat Buchanan. I mean, there were 
different agendas, which, again, I'm sure you got, and the 
topic was generally the Central American Freedom Program, and 
getting the word out on the President's program in Central 
America. 

And so they'd had three of those, they seemed like 
they were very successful, and they had letters backing up — 
you know — not only did they have the letters, but they had 
the itinerary, so I knew that the meetings had taken place, 
and in my discussions with people at the White House, they 
confirmed that, these, auys in fact have been in here, and 



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they've been very supportive and very helpful. 

All the feedback I got from everyone was extremely 
positive . 

Q Let's stop there for a second because you've jumped 
to a question I was going to ask a little later. You say the 
feedback you got from everyone. With whom did you discuss 
NEPL and Mr. Channell? 

A Well, you know, my memo to Don Regan says that I 
spoke to Bud McFarlane and Oliver North, and--who was the 
other one? Oliver North, Bud McFarlane. Oh. Elliott Abrams . 

I know I talked to people in Public Liaison. Who, 
specifically, I don't know. I know that my calendar has me 
meeting with Linas Kojelis who, you know, I had not known, I 
don't think, when I was at the white House, about these guys 
and their past briefings. 

I know that I talked to Bud McFarlane because we 
had that meeting out in Utah on his vacation. And while 
people like Bud--and I can recall that because of the unusual 
place of the meeting--we met out there in Utah--he did not 
indicate that he knew the principles. I don't think he knew 
who Rich Miller was or who Channell was, but he was very 
familiar with the TV programs. 

And any time I would talk to somebody, I would 
either provide them with a cassette tape of the ones that 
they had done up to now, or they had these so-called story- 



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boards, you know, which are just a pictorial description with | 

the language of the conunerciaJ. . I 

And when you'd show that, people woi(i.d say, oh, I 

yeah — you know--we've seen those. It became ^r«ry apparent to i 

me people knew the product, jThey didn't seen to know the | 

individuals quite as well. B«d had no idea who they were. j 

Q What about Colonel Horth? j 

A I don't even recall exactly what he said, or even | 

I 

when it took place. I mean, my calendar shows different- j 

i 
meetings that I had prior to the January 30th briefing. i 

The only thing I can say, there was always positive j 

feedback. I never found anyone who reported anything 

negative at all- . 

Q Let me just clean up the record a little bit. Are , 

you saying that you don't recall specifically discussing NEPL \ 
and Mr. Channell with Colonel North, prior to the January 30th i 

briefing? ! 

A Oh, no, I did before the January 30th briefing. j 

Q Do you recall the specific discussion you had with j 
him? 

A No, other than talking about, you know, that they j 
wanted to have a briefing, another one, and now I can't remem- I 

ber specifically what was said, other than--you know--the j 
meetings that I did have because they're on my calendar. 

There were a couple just before this January 30th 



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briefing, and one of them was a very brief one with him, and 
then it led right to a meeting with Linas Kojelis, and I 
believe that he is the one that introduced me to Linas, or 
called down there and said, look, Fischer's here, this 
request is in for a meeting, would you see him, kind of 
thing. That's how I can best put it. 

See, what happened on the briefing was, I had the 
meeting with Regan in Los Angeles on January 2nd or January 
3rd. He asked everything be put in writing, I did, and -once 
the request was in writing it was then an internal White House 
document, and then it was up to the Public Liaison Office, 
what they did with it. 

Q Okay. Let me back up on a couple of points here, 
and try to bring it back full circle. Give me a little bit 
about the history of your relationship with Oliver North. 

A The history of mine? 

Q Yes. When did you first meeting him? What issues 
did you discuss? 

A The first time I recall — I mean, I don't recall the 
exact time I met him, but in the course of my responsibilities 
of taking those attendance records at meetings, particularly 
during National Security, different people from NSC, staff 
members, which North was one of them, would come in at 
different times with the President and the National Security 
Advisor during that National Security briefing time. 



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I didn't know who all the officials were, and so I 
would have to go to Poindexter or McFarlane, and say, okay, 
who's that guy there? and who's that guy? It was in the 
course of identifying, going to these guys and saying, who's 
that man and that man, that I got to know — you know-- I put the 
name North and the face together. 

When I was in the White House, he was nothing more 
than--I finally knew who he was, and that was about it. I 
don't ever — 

Q Were you aware of the--they called them "accounts" 
at the NSC — but were you aware of the issues that Colonel 
North handled for the NSC? 

A Everybody knows what he does now. You know, at the 
time — you know — I may have known that he was a spokesman for- 
-you know — Central American and the President's program on 
that. You know, at what point did I know that? I may have 
known when I was there; it may have come to my attention 
later on. I just can't tell you. 

You know, the trouble is that you don't — it's hard 
to put in time frames when you knew something. I mean, I 
could have read a newspaper article last summer, and all of a 
sudden been aware that he was also a terrorist expert . 

And then, you're really not too sure — you know — did 
you read that then, did you know it when you were in the White 
House? See, my dealings were primarily with the National 

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Security Advisor to the President, and it was just — you know- 
-my contact with people beneath him were almost non-existent, 
unless they happened to come through my office to get into 
him. 

But, you know, I think they all knew who I was, but 
beyond that, there was no reason for me to be dealing with 
individual members on the National Security Council. 

Q To the best of your recollection, when was the 
suggestion first made that President Reagan might be able-- 
that someone might be able to secure President Reagan's 
attendance at white House briefings? 

A You know, I would guess that it would probably be 
in December of 1985, and it would have to be after I reviewed 
all of the things that they had done up to this point. And 
the conclusions I drew from looking at the record, and from 
talking to people, was that — you know — that they were very 
effective at what they did, and I was getting nothing but 
positive feedback from people. 

So I made the recommendation to Reagan directly, 
saying this is what they've done before, this is where they 
want to go, this is their track record, and these are the 
people that, you know, seem to like what they're doing. And 
so then I made the recommendation. 

Q Had you raised that possibility with Miller, 
Channell, or Conrad before speaking to Reagan? 



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A You mean before talking to Don Re/gan. 

Q To Regan. I'm sorry. | 

A Oh, I'm sure that I did. I'm sure that I did I 

because I went to Los Angeles to talk t Regan about that, and | 

other matters . | 

Q So that the trip to Los Angeles was, at least in j 

I 

part, targeted to raise this possibility? i 

A Yes. It was. Yes. | 

Q Do you remember when the trip to Los Angeles took 

place? i 

A January 2nd or January 3rd, and it was, you know, j 

from Utah to Los Angeles and back. Regan was out there with i 

the President. The President was on vacation. ! 

MR . McGOUGH : I want to have marked some exhibits . i 

We are going to have a series of them, actually, and they all ! 

are, to some extent or another there is a little bit of ■ 

redundancy, but this is the way in which they were given to usj 

by the various source agencies. And I would like to keep i 

thMi together so that we can get a little bit of an idea of j 

how the paper flowed. I 

i 

[Documents were marked for identifi- 1 

cation as Fischer Deposition Exhibits | 

! 

Nos . 1 through 4 ] I 

[Brief recess] ] 
MR. McGOUGH: Back on the record. 



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BY MR- McGOUGH: | 

Q We've marked a series of Exhibits 1 through 4. | 

Let's take a look — and again, in a sense of getting some I 

context to this — Mr. Fischer, at Exhibit 1, which has the | 

White House correspondence-tracking worksheet on the front, i 

and about midway through that exhibit you will find, I | 

believe, a January 5th memo from you to Mr. Regan. | 

A Okay. I 

Q Are you with me? ' ". j 

A Yes . I 

Q Look at as much of the rest of it as you care to. I 

A I'd like to some day. It looks interesting. ! 

Q I want to focus on the January 5 memo. I 

A Okay . 

Q Are you with me? i 

i 

A Yes . January 5th memo? I 

Q Yes . j 

A Yes . j 

Q All right. Now this is the memo which I believe youi 

referred to earlier as being sent to Mr. Regan. j 

A Correct. | 
Q It would have been after your meeting with Mr. 

Regan in California? 

A Correct. As a matter of fact, that's as a result 

of the meeting. He said put it in writing and we'll get it 



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into the system- 

Q I'd like to focus on that meeting with Mr. Regan a 
little bit, if we could. What can you recall telling him 
about the American Conservative Trust and the National 
Endowment for the Preservation of Liberty? In general terms. 

A In general terms I told him what I told everyone, 
what I was asking about, when I was talking to different 
people in the Administration about these people. I said this 
is what I've found out about these guys: these are their 
commercials, they've had these meetings, this seems to be 
their track record. 

In all of the meetings I had with people, including 
the Counsel's Office at the White House, I would say this Is 
as much as I know about these people, they seem to be highly 
effective at supporting the President, but you have to check 
them out yourself. I don't know everything about them. 

I was r you know, extremely careful in what I said to 
people. I mean, I could only show them what I had, and I 
said this is what I've got on them, and then I told--I don't 
know the exact words, but I described the wish of the group, 
and it was my recommendation that this briefing take place in 
the Roosevelt Room. 

Q Did you understand what kind of entities NEPL and 
EPL and ACT, the American Conservative Trust, were? 

A What do you mean? 



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Q I mean, one was a 501(c)(3) organization. 

A You )«now, it may have even been in the material. I 
mean, I'd have to tell you, in January of '85 I couldn't have 
told you what a 501(c)(3) was. I understand them completely, 
now. But that may have even been in some of the memos. I 
don't know. That, you know, this one was a 501(c)(3). I ! 
knew that there were, and particularly as the association 
continued, I knew that there were multiple entities. 

Q Did you understand any distinction between the type 
of thing ACT did and the type of thing NEPL did? 

A No. I mean, it may have been explained, but it's | 
nothing that registers with me. I mean, at one time I recall i 
having a conversation with somebody — I don't know if it was | 

Rich or whether it was Channell, or who it was — about why all I 

i 
of, you know, these entities. And someone described it to me | 

as the reason there are different entities, certain entities 

are allowed to do some things. Some are allowed to lobby; 

others are not . 

That these things were created with the advice of 
counsel, Channell 's counsel, and that they set up certain 
organizations to do certain things, and that's about as much 
as I ever knew about it . 

But the fine line between NEPL and ACT I couldn't 
tell you. 

Q Was there any discussion with Mr. Regan at the 



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California meeting about your compensation? 

H Yes . There was . | 

I 

Q Can you tell me what that was? 

I 
A Yes. First of all, this was a very friendly ] 

meeting. Don Regan and I were, I would describe as good I 

friends. 1 got to know him very well as a Cabinet officer, \ 

and when he was going to become chief of staff during the I 

transition, he called me over to Treasury, frequently, to talk! 

! 

about the White House and personnel, and in fact asked me if I 

I would stay another year. | 

Originally, I was to leave in January, and I said I 

wouldn't, but I would give him until April. So Don Regan and i 

I had a great working relationship, and as I described who | 

these people were and what they wanted, before I could even i 

say I want you to know this is a client matter — which I had | 

1 
I 

every intention of doing because Marty and I had discussed I 
that — and I told him that — and I described to him the Angola 
thing that happened to me, and that I considered these, this 
client here, as a real gift from God because they did nothing 
but support Administration policy. 

And before I could say anything after that, he 
said, "I hope you're being compensated for this" and I said, 
"I am being compensated for it." I mean, I made it clear to 
everyone that I came in contact with that this was a client. 
Q Did you discuss the terms of that compensation with 



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A No, no. 

Q -Did he ask? 

A No. He wouldrr^l: be interested in something like 
that. 

Q Let's go to the January 5 jnereorandam, if we could. 
Now I'm interested, initially, in what you sent to Mr. Regan. 
You'll notice in the upper righthand corner there are "N" 
numbers for the various pages which are our code numbers. 

A Yes. 

Q Now you sent him the January 5 memo which is 
N39610, is that right? 

A Correct. 

Q And it had attachments to it, is that right? 

A Yes . 

Q Are the attachments N39611 through 39615? 

A I believe they are. 

Q Do you recall any other attachments in that 
meaorandum? 

A No. I don't. 

Q So that what you sent him, essentially, was a cover 
letter, a meeting proposal, and storyboards, or a story line 
for some of the commercials that NEPL and ACT had done, is 



that right? 

A Correct. 



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Q Now I notice in the materials that you sent to Mr. 
Regan, there's no specific mention, as far as I can tell, of 
Mr. Channell himself. But rather, there's just a reference to 
the American Conservative Trust and the National Endowment 
for the Preservation of Liberty. 

A Yes. 

Q Was that intentional? Why wasn't Mr. Channell 
himself mentioned as being the principal in both ACT and NEPL7 

A I have no idea. I mean, I'm not saying it's . 
intentional other than — you know — these groups are the ones 
that — you know--that announced this program. I can't answer 
that. 

Q Did you discuss Mr. Channell with Mr. Regan? 

A You know, I probably did, but, you know, I just 
don't know. I mean, I would say that I must have because I — 
you know — I was talking about these programs and the people 
that were involved, and that I had checked them out as much 
as I could. And beyond that, it was up to he and his staff, 
and Fred Fielding. This same packet went to Fred Fielding. 

Q The thrust of my question is you said one of the 
things that you were hired to do was raise Mr. Channell 's 
profile, both in the white House and publicly. 

A Right 

Q And yet, when you submit a proposal to the White 
House for the meeting, you speak of him in the corporate 



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sense, that is, as ACT and NEPL, but there's no mention of Mr 
Channell himself. Were you in any way — 

A You know, I can't say it was a deliberate deletion, 
if that's what you want. I have no idea why it's not. 

Q You were aware, by that time, however, that Mr. 
Channell was known to a nximber of people in the White House? 

A No, he was known to some people; it's his programs 
that were really know. When you said television commercials, 
people would say, oh, yeah, I've seen those. It was dif- 
ficult to find people in the Administration who knew who 
Channell was, directly. But they knew that — he was known by 
television commercials, and this ACT, and NEPL. 

Q And that was one of the things that you were 
retained to do, was it not, was to raise his profile, his 
personal profile in the Administration? 

A Personal profile and the track record of his 
organizations . 

Q Were you in any way uncomfortable with pushing Mr. 
Channell to the front in this effort? 

A Not when I first met him, as I would be involved in 
meetings. We had certain meetings that I can tell you about, 
in which some activity took place which made me feel uncom- 
fortable, and if you want, I can give you a real quick 
example. We had a meeting, which I arranged with members — 
I'd say about five or six people of the National Security * 



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Council — on the SDI issue. These were the people in the 
National Security Council that had responsibility for the SDI 
Program. 

And the purpose of that meeting was for Channel 1 to 
get a clear understanding of what the Administration's 
policy, and what the President wanted SDI to become, because 
there were all sorts of different stories about what Reagan 
wanted. 

And we'd already been meeting with Jay Keyworth who 
was the former science advisor to the President, and the guy 
who really thought of this whole program, the SDI Program. 
And we were in the process of writing a brochure that would be 
used in Channell's SDI Program. 

In the course of this meeting, which we had in the 
BOB, in the National Security, one of their offices, instead 
of just listening to what these people were about to tell 
him, he proceeded to tell them what the President's position 
was, and it got very uncomfortable. 

And it got to the point where he was lecturing the 
President's staff on what the President wanted. He was 
opening disagreeing with what these people were telling him, 
and told him that they just weren't moving fast enough, and 
that this was what the President really wanted, and they'd 
better get their act together. 

Basically, I'm — you know--I'm putting--those aren't 



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the exact words. But that was the feeling. I mean, I was 
uncomfortable, my friends on the National Security Council 
were uncomfortable, and I was not pleased with the results of 
that meeting. And I let — I didn't let Channell know. I 
always worked through Miller. I told Miller — Miller was 
there--how upset I was, and that, you know, we just can't 
have that kind of activity. 

Well, I mean, it's definitely a way to get no 
assistance from the Administration. That's kind of the- thing 
that made me feel a little uncomfortable, and in one meeting 
he would be fantastic. On Constitutional Minutes, where we 
met with the Attorney General and his senior staff, talking 
about all these TV commercials, and where they wanted to go on 
the Constitution, he couldn't have been better. 

I mean, it was just a marvelous meeting. So, you 
just — you know — you never knew how he was going to be. He 
chewed out Elliott Abrams at a meeting one time. He was 
volatile. 

Q We'll talk about Mr. Abrams in a minute. But as 
far as the paperwork on the January 30th meeting, or what 
ultimately became the January 30th meeting, other than the 
January 5 memorandum and its attachments, did you submit any 
additional paperwork? 

A I don't believe I did. I believe this was the sum 
total of it. Now copies I gave--you know--I recall getting 

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one to Fred Fielding's office right away, getting one to 
David Chew who was, you know, the staff's secretary, and I 
believe that's--no — and I gave one to the Secret Service, 
not — I don't think I gave them so much this as I gave them 
list of potential invitees, to make sure that their — and it 
was Social Security numbers, and everything else, to make 
sure that we didn't have any — you know — convicted felons, or, 
you know, strange people going into the White House. 

So, I think that's as much documentation as I- gave 
the White House. 

Q Did you see any of the subsequent internal documen- 
tation at the White House? 

A No. 

Q Were you copied on any of the remaining pieces of 
correspondence in Deposition Exhibit 1? 

A No. Let me look at these very quickly. No, never. 
Nothing from — no, never saw any of this. 

Q Now we may be jumping ahead a little bit, but let's 
look at Deposition Exhibit 4, if we could .(Rooking at 
Deposition Exhibit 4, this is a scheduled proposal, dated 
January 8, 1986- 

A Yes. 

Q From Linda Chavez to Fred Ryan. 

It refers to a meeting with "key private sector 
supporters of U.S. -Central American policy." 



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A Yes. 

Q And if you look at the bottom, participants include 
people from various organizations, including Spitz Channell, 
American Conservative Trust. 

A Right. 

Q Were you aware of the proposal that such a briefing 
be conducted between January 20th and January 26th? 

A I don't believe I've ever, after leaving the White 
House, that. I ever met with Linda Chavez. And I just den't 
recall . 

My contact, I believe, was Linas Kojelis for this 
briefing. And that's, as I recall, the only person from 
Public Liaison that I dealt with. 

But the answer is no, I did not know. 

Q Can you divine from this perhaps who the source of 
the proposal was? 

A Oh, I know I can just assume it's Public Liaison. 
They were in charge of all of these different groups. 

And besides the briefings that Channell had of his 
own group, he was continually invited to these kind of 
meetings. And they computerize all that. If the subject 
comes up Contra something, boom, they'll have 15 groups and 
they'll just invited those people in for briefings and give 
them updates . 

Q Did anyone ever discuss this meeting with you as 

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opposed to the January 30th meeting? 

A I don't even know that it ever took place. 
MR. WORK: January 30th or 3rd did you say? 
MR. McGOUGH: 30th. 
MR. WORK: 30th. 

THE WITNESS: No, I don't recall that at all. 
BY MR. McGOUGH: 
Q And Mr- Kojalius, as far as you recall? 
A I sure don't recall it, no. -. 

Again they would have no reason to tell me what was 
going on internally. 

Q Do you even know that this took place? 
A I don't believe it did. And I'm just looking for 
another document here. Hold onto it if you care to pursue it. 

Q Now, if you look at Deposition Exhibit 4 — I've got 
two 4s here, that's not 4. This is the one you have right 
there, right at the bottom, this is numbered what? 
A I have 3 . 
Q 3, make it Deposition Exhibit 3. 

And in particular page 13670. It's about the 
middle of the package. 

That's a memorandum from Mr. Burkhardt to Mr. 
Martin, correct 



Yes. 



And dated January 17. 



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A Yes. 

Q It refers to the briefing and Presidential drop-by 
for ACT and NEPL. 

A Right. 

Q And the second sentence says, "Mote that the NSC 
and Linda Chavez's office have also requested another session 
for other groups which support our Nicaraguan policy to take 
place in late January. I believe both of them would be 
justified but Reagan's office might want to combine theih-- 
Regan's office may want to combine them." 

A Yes. 

Q Did you ever discuss with anyone the possibility of 
combining those two meetings? 

A I don't ever recall that. I don't recall ever 
knowing there was another briefing. 

Q When in fact the briefing did occur on January 30, 
is it fair to say that it was for ACT and NEPL alone? 

A Yes, I believe that's correct. 

Q And their guests as opposed to other organizations 
involved in the Central American program. 

A Yes. 

Q Did you ever discuss Mr. Channell with President 
Reagan? 



Yes. 



On what occasion? 



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A There was a time when -- I think the first time was 
probably just before this briefing. And I saw the President 
as he was going from, I believe, the Oval Office into the 
Roosevelt Room. There's a hallway there. And as he was 
going across, you know, his entourage was with him, his 
personal. I am not even sure that Regan was with him. And 
it was to tell him that when he walked into the room -- you 
know, he was just going to stand up and thank these people, 
and he ended up taking some questions, I believe, but he was 
going to be there for just a few minutes. 

But, off to one side, was a guy named Fred Sacher, 
S-a-c-h-e-r. Fred Sacher was a fellow Californian who, 
according to Channell's group, had initiated this whole 
program of TV commercials in support of the President's 
programs in Central America, and had initially funded the 
first phase of the commercials. 

And then on one side of the table was going to be 
Channell. And it was just to let him know who was on which 
side and to particularly acknowledge Sacher for starting the 
program and for Channell for organizing everything. 

Now, I believe that was the first time. There were 
other times when commercials were sent in and he would know 
that this group was putting together commercials. 

But one other thing, I think he already knew who he 
was because in the November briefing I was telling you, the 



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SDI program, I had been told that in the course of that small 
meeting on SDI that the President referred directly to 
Channel 1 and thanked him for some commercials that he had 
done saluting the President's efforts in the Geneva Arms 
Control . And they were commercials that ran the night the 
President was flying back, before he spoke to Congress. 

And that the President singled him out at that 
meeting to thank him and told him that he had personally seen 
the commercials on television and thought they were great. 
So, he had — you know, from that explanation, I 
believe he had met him before and knew who he was. But, 
other than that, before the January 30th, I think that was 
the only time. 

Q And one of the issues that has risen in this 
investigation has been what President Reagan knew about the 
organization before which he appeared, or the people before 
which he appeared on January 30th. 

In your memorandum to Mr. Regan, and in a number of 
the pieces of internal correspondence that it spawned, ACT 
and NEPL are referred to as organizations that are conducting 
public relations campaigns and commercials, and there is not 
any reference to direct financial support to the Nicaraguan 
Resistance in those pieces of correspondence. 

To your knowledge, was President Reagan aware, when 
he appeared on January 30, 1986, that either ACT or NEPL or 



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Mr. Channell or any of his organizations were in fact 
providing direct financial assistance to the Contras? 

A No, not to my knowledge at all. 

Q Were you aware at that time that those organizations 
were providing direct assistance? 

A No. 

Q When did you first become aware of that? 

A The only time that I can recall even having a 
reference to any kind of assistance was the mention of one of 
the contributors had provided some kind of humanitarian aid. 
And that is as much as I knew about it. I don't know whether 
it was — 

Q When was that? 

A It was in a document that was — there is a list of 
different people who had photo opportunities with the 
President, and in the description of one of these people, it 
had mentioned that she had — it's a little unclear whether 
she was supporting humanitarian or whether she did it. But 
there was a reference to humanitarian aid. And that is, you 
know, that's about as much as I recall knowing anything about 
assistance. 

The focus on this, the reason for that meeting was 
— and the President looked at their commercials before he 
went into that meeting, so he was able to go in and thank 
them for doing the commercials. That's precisely what he 



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went in there for. That's why the meeting was organized. 

Q At any time prior to the January 30th briefing, did 
you discuss with Colonel North the activities of ACT or NEPL, 
specifically any activities that offered financial support to 
the Contras? 

A No. There are reference in my calendar meetings, 
and the meetings prior to this January 30th briefing, I can 
only suppose had to do with this briefing that was to take 
place that was to take place on January 30th. And that's 
what was discussed. 

Q How many other White House functions did you 
arrange on behalf of ACT or NEPL or their contributors? 
By function, I'm speaking of any kind of meeting. 

A There was, you know, the activities in relation to 
the SDI program with the National Security people. There 
were activities that were generated — meetings that I went 
over and had individually with the counsel's office and with 
Public Liaison in reference to their SDI briefing that was to 
take place in June. And there were a lot of those meetings. 
But, in general, that was just me going over. 

Q How many events involving an appearance by President 
Reagan for his own personal involvement, personally respon- 
sible for? 

A There would be the January 30th briefing. We had 
one scheduled for SDI that was postponed and eventually never 



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happened . 

Q Was that to include a drop-by by the President? 

A Yes . There was going to be General Abramson and 
Keyworth . 

And then there were approximately six photo 
opportunities that took place over I guess a 10 or 11-month 
period in which people had their photos taken with the 
President. 

Q Do you recall any of the individuals, the names of 
any of the individuals? 

A Oh, sure. Fred Sacher, Mr. and Mrs. W^rm, Mr. Bill 
O'Neill, who owns Investor Daily in California, Mrs. Garwood, 
Ellen Garwood, Barbara Newington. And there were a couple 
that were just arranged for the white House, and I didn't go 
and I didn't meet the people so I can't recall their names. 
If you gave me names, I could probably tell you. 

Q Were you involved in Mr. Hunt's, L. Bunker Hunt? 

A Yes , Bunker Hunt . And I think there was a name 
Oriscoll, but I don't know whether — the Driscolls, that's 
another name. 

Q Was the procedure the same for each of these photo 
opportunities in what you did in order to bring them about? 
Was it comparable from photo opportunity to photo opportunity? 

A Well, the only difference would be in some I was 
not there. But generally I would be there and I would meet 



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the people prior. 

Q But I mean as far as requesting the photo oppor- 
tunity. 

A Oh, yes. 

Q And could you walk through for me what you would do 
in order to do those? 

A Generally there would be contact with the Scheduling 
Office saying that is there a good, you know, in the next 
month or two, to have a, you know, when are you doing photo 
ops or when would be a good time? And they would give me 
times that looked good, and then I would communicate also 
with Jim Kuhn, the President's personal aide, who was my 
replacement, and say, do you have any — you know, he was the 
one that would actually, you know, like I would before, he 
controlled the office. And so it would be between Scheduling 
and between Jim Kuhn. 

Q Did it have to be reviewed by Donald Regan? 

A It was approved by Don Regan. 

Q And how would you — would you — what was done 
about it in any way? 

A I discussed that with Don as one of the things that 
was requested. 

Q Was this in January, the January meeting? 

A I believe it was January, or if it was not, then it 
was later on. I mean it was at some point. I <-«n't recall 

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whether it was a part of it. Because I think the January 2nd 
briefing had to do with the briefing. But there was a time 
whether -- I think it was in his office later on in which we 
talked about the group and the fact that there were some 
people who had been very supportive that we would like to get 
photos for. And, you know, that is something that is very 
easy to do in the White House. 

MR. McGOUGH: Off the record. 

[Discussion off the record] 

MR. McGOUGH: Let's go back on the record. 

BY MR. McGOUGH: 
Q I said perhaps it was easy for you to do in the 
White House. 

A If you know the procedure. And, frankly, you know, 
you have obviously reviewed the record of these people and 
their contributions, not only to the television programs but 
to — these people had been long time contributors to Reagan. 
They were, you know, either Republicans, well-known people. 
And I won't bore you with how photos take place in the White 
House . 

But it was discussed with Don Regan. He said that 
it had his approval . When I discussed that subject not only 
with Jim Kuhn but Bud Ryan, I said this has been discussed 
with Don, check it out. And, you know, I'm sure they did 



check it out. 



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So they would tell me what looked good. And then 
people would be notified and brought to Washington. 

Q Did you discuss with Mr. Regan the approximate 
numbers of such requests? Did you talk to him in terms of 
dozens or a few? 

A I can't recall. But the list was, you know, the 
list was never -- I don't think there were ever more than 10 
names on the list. And it was, you know, the one list that 
was worked off of. 

Q Whose list was that? 

A I got it from Miller who probably got it from 
Channell. And it was a list of a computer readout — it was 
not a readout, but, you know, something from the computer 
that was given to me that had the names, social security 
number, date of birth, and a brief description of who these 
people were, and their past history in politics and what they 
had done to help on the PBS. 

Q Do you think there were approximately 10 on that? 

A I'd say about 10 on the list, yes. 

Q When you say what they had done, do you mean how 
much they had contributed? 

A Yes. 

Q That would have been in the information given to 



you? 



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and also, you know, if they had been -- you know, this person 
is a Republican, you know, a little bit about them to show 
that, you know, that they were long time supporters. 

Q Did you do any screening of that list? I mean you 
got a list of approximately 10 and you wound up setting up 
meetings for about six. Did you further cull that list? 

A Well, I know on the initial list, all the people 
were on the January 30th invitee list. At least I'm pretty 
sure they matched up. 

I remember, in talking to Fielding, I think it was 
Fielding directly, about that invitee list, the one name that 
popped up in my head that I thought may be a problem was 
Bunker Hunt because of the problems he had with silver. And 
I remember saying, look, I don't know these people but, you 
know, the service is running the name check. This is the 
only name I recognize as a public figure that maybe has done 
something that can cause problems. He said, look, he hasn't 
done anything that is an embarrassment. 

So that's the only name — I mean, counsel's office 
had the neunes . 

Q Did you send the entire list over to Fielding's 
office? 

A Absolutely, hand-delivered it. The January 30th 
invitee list which I believe that everyone of these names 
plus some other names. 



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Q I was speaking to the list of 10 if we can call it 
that? 

A No, that did' not go to Fielding's. It had already 
been covered. 

Q Okay. But I guess my question is, did you, in 
setting up these appointments or these photo opportunities 
with the President, how did you — if you did, how did you 
differentiate among them? You've got six people who actually, 
six or seven who actually did have a photo opportunity. " 

Was everyone on that list ultimately — did that 
everyone on that list ultimately receive a photo opportunity 
with the President? 

A I can't answer that. I don't recall. I mean there 
may be one or two that didn't. 

I know that some of these people were elderly and 
there was health problems. And sometimes when they wanted to 
have one, all of a sudden, the person was in the hospital and 
there were those kinds of problems. So there may have been 
on« — you know, the last one was last fall, I believe in 
October was the last of the photos. 

But I believe most of the ones on the list did with 
maybe one or two exceptions . 

Q Did you ever say to Mr. Channell or Mr. Conrad or 
Mr. Miller, look, we're just going to the well too often on 
this, or something to that effect? That, you know, there are 

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only so many of these things we can do, and you're pushing 
too hard for too many people? 

A No. Because there weren't that many people and it 
was over a long period of time in which they took place. And 
the Photo Officer literally done, I would say almost every 
day. You know, there's not a day — at least, someone, Jim 
Baker would come by and say, oh, I got so and so from Texas, 
a great friend of the President's. Take him in and give him 
a photo. And, you know, it wouldn't be on the schedule. You 
would just, you know, you would just take people in for 
photos. I mean it's part of politics and part of, you know, 
one of the rewards of being an activist and being frankly a 
big contributor. That's why people joined the Eagles and why 
you joined Reagan's Citizens for Republican in California 
because every year you get invited to Washington and you get 
to see the President. 

And so that's part of the reason these kinds of 
things are done. And, in fact, you know, the great extent to 
which these people gave money and the President was able to 
see on television what they were doing, there was absolutely 
no reluctance to doing this . He was more than pleased to 
meet with these people. And Don Regan, there was no problem. 

Q Did you explain to Mr. Channell and Mr. Conrad that 
photo opportunities could be a fairly routine matter that you 
felt you could do? 



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A I would doubt very much. I mean I don't know what 
I said to them. I would doubt I would say that anything in 
the White House was easy. 

Q I guess it's a poor choice of words on my part. 

Do you tell them that you thought you might be able 
to set up photo opportunities? 

A I'm sure I did. 

Q And that was part of the services you were rendering 
to IBC? - -. 

A Well, it became one of the things that was done. 
It was not part of initial discussions. In matter of fact, 
the real first things that were talked about that I got from 
Art and I believe from Rich was that there were certain 
people that Channel 1 wanted to meet to help explain who he 
was and what his programs were. And, you know, there were a 
list of people like Frank Fahrenkopf and Paul Laxalt, and 
Elliott Abrams I know was one that he wanted to meet. And we 
eventually did have that lunch with Elliott. And I think Don 
Ragan was on the list. 

I mean there were those kind of people, you know, 
that ended up, being Charlie wick and all sorts of people 
throughout the Administration and, you know, opinion type 
leaders and, in fact, you know people in the Administration 
that he wanted to get to know to tell them who he was and 
what he was doing and where he wanted to go with his proqrams 

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in support of the Administration. 

So it evolved into that, and that did become a 
request, could this happen, and I said yes, it could be. 

Q When you set up the January 30th briefing, did you 
attend that briefing? 

A No. Best I recall, what happened was the room was 
so packed, and I had met the President I believe right in the 
hallway just to say Mr. Sacher is here and Channell is here, 
and you want to recognize those people. And he went in." And 
I remember going around to the backdoor and just peeking in 
and seeing what was going on. 

But the place — besides the chairs that were in the 
Rose Room, everything around, they brought in folding chairs, 
and the place was packed. So I stayed outside. 

Q Were you any of the functions that evening? 

A Yes. They had a dinner and a reception at the Hay- 
Adams at which Elliott Abrams was to speak. And I went over 
for a brief time at the cocktail party and then left. 

Q Were you ever present when Colonel North spoke to 
any of Mr. Channell 's contributors? 

A Yes. I was at a — well, I was in the complex 
obviously when he gave his slide show to the January 30th 
people. I was not in the room. 

I think the next time I was ever with him when he 
spoke to a contributor was Bunker Hunt, and that was in a 

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meeting at the Hay-Adams, like a breakfast, somewhere around 
breakfast time- 

Q Can you describe what took place? Who was there 
and what took place? 

A It was North and Channell and Bunker Hunt. 

Q Why were you there? 

A I kind of invited myself because I wanted to get to 
know Bunker Hunt a little better. He was a guy that fas- 
cinated me as a great financier, and I wanted to meet hijn. 
And so I asked if I could drop by for a few minutes, and they 
said sure. 

Q Did you attend the meeting or meal? 

A It wasn't a meal, I think it was more — maybe it 
was a meal. To me it was like late breakfast. I was there 
for part of it. 

Q How long were you there? 

A This is just a guess, 20 minutes maybe. 

Q What happened while you were there? 

A The best that I can recall about that is that 
Bunker had not attended the January 30th briefing. He was 
invited and couldn't make it. And North was giving him a 
briefing on the situation in Central America, and obviously 
the slides weren't there, but I believe there was a map. I 
seem to remember a map of Central America and that part of 
the world. And I kind of call it, it became known as the dog 

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and pony show that, you know, you went through a description 
of what was going on in Central America and with the Soviet 
Union's incursion down there, and the threat that it posed to 
the United States. And talked about the plight of the 
Contras . 

Q Did you understand why that presentation was being 
given to Mr. Hunt? 

A Yes, because he had missed the briefing in January. 

Q Did you understand why that briefing was being 
given, I mean why he was being given that information? 

A Just because all the other contributors had gotten 
that briefing, and that was, you know, they wanted him, as I 
guess, was to get the saune information as everyone else had. 

I believe he never attended anything in the 1985 
briefings. This was his fist exposure I believe to that 
program. 

Q By that time, or at that time, did you have any 
understanding that Mr. Channell was making solicitations for 
direct aid to the Contras? 

A No. There was nothing at that. 

Q During that portion of the meeting that would have 
alerted you to that? 

A No. Matter of fact, you know, if I recall, it was 
North that did all the talking. He was doing the briefing. 
And everyone just kind of sat there and listened. 



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Q Did he speak in terms of specific military needs of 
the Contras? 

A He talked about the plight of the Contras, and by 
that that they were suffering greatly, that they were, you 
know, they were in need of food, and that they were, you 
know, in need of bandages, medical care, and they were out of 
weapons, that they were fighting a war with very little. He 
did talk about that. 

Q Did he talk in terms of specific amounts of money 
needed to supply them? 

A Not at all. 

MR. WORK: Needed to supply what? 

MR. McGOUGH: Needed to supply those materials. 

BY MR. McGOUGH: 

Q Do you recall a lunch at the white House mess with 
Mr. and Mrs. Wurm and Marty — 

A I do- 

Q I believe it was in about March of '86. 

A That sounds about right. 

Q Can you tell me how that was set up and why it was 
set up? 

A It was set up by me, and it was just to take these 
people to lunch in the White House and to get acquainted with 
them. And then, afterwards, they had their photo with the 
President . 



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Q Can you say what was discussed? 

A I can recall them very well. Either he or she is 
the heir to the Gerber money, Gerber Baby Food. And they 
spent a lot of time talking to Marty and I about this island 
that they owned off the coast of Central America, and just 
talked about their family and spending summers down there. 
And kind of why they got involved in the issue because, you 
know, they had a place down there, and they were very worried 
about what was happening in Central America. 

And in fact they later wrote and sent us photographs 
of the island and invited us to go down there. 

Q After you left the White House, did you retain 
White House mess privileges? 

A Yes. 

Q Is that standard operating procedure? 

A I think there's a lot of people that have access to 
the White House mess, yes. If there's room available for you 
to go there. You call ahead of time and ask for permission. 

Q And did you at that time still have your White 
House pass? 

A Yes. 

Q Is that standard procedure to retain your pass 
after you've left the White House? 

A I wouldn't want to call it standard. I think with 
some people, it was standard, people who were close to the 

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President, people that continued to provide services to the 
White House. And by that, I mean it was something that Don 
Regan had done for me. Matter of fact, when I left, mine 
soon expired and I was issued a new one. And I was frequently- 
called into the White House by the Regan staff, David Chew in 
particular, to come in and have usually a late afternoon or 
early evening strategy sessions on different things that were 
going on, different problems the Administration was having. 
And they would ask me for my insight or recommendations-. 
There weren't just many old-timers left at the 
White House and people that knew the President well. So I 
was frequently called over to just sit and talk. You know, 
that is approval. So I believe I must have. I mean there's 
a sign-out procedure when you leave the White House, and one 
of those things is you turn in your pass. And when it came 
time for that, I didn't have to. So I believe it came from 
his office or someone in his office had to approve that. 

Q You say there comes a time when you turn in your 
pass. 

Do you recall who did the debriefing or the exit 
procedures? 

A Well, you go. You have a sheet of paper that tells 
you to go 14 offices, whatever. And in each place you do a 
certain thing. In one of the places, as you go in and turn 
in, you know, your pass, and that, one, I guess, was just 



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signed off or something. I didn't have to do it. I mean it 
was on the record that I had mine and it was outstanding. 

But I can only tell you you can't leave the White 
House without either turning it in or having someone say this 
has been approved. 

Q Do you recall who approved it? 

A It was either Don Regan personally or someone in 
his office. I mean it would take someone of that stature to 
tell whatever office that is he doesn't have to turn his- in. 

Q Did you ever ask anyone for permission to keep your 
White House pass? 

A I don't recall that. I don't recall that. And I 
may have . 

Q Do you still have your White House pass? 

A No. That was requested by a Jonathan Miller who 
was then — I can't remember the title of his job — it was 
like the Administrative Officer — had called last fall and 
said that they were pulling in all of their passes that were 
outstanding, and would I bring mine in. And I said of 
course, and did. 

Q In the meetings we have already discussed, did you 
ever have any contact, direct contact with any of Mr. 
Channell's other contributors other than pleasantries on the 
way in or out of the meeting room? 

A With me personally? 



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Q You personally. 

A No, I didn't. Other than pleasantries on the way 
in and things like that. 

Q In other words, after they had their photo, was 
there any contact? 

A I don't believe there was with any of them. 

I think with Bunker Hill, he may have been the only 
A 
one that I ever corresponded with. I just wrote a little I 

enjoyed getting to meet you kind of thing. And I never heard 

back from him. 

But other than that, I don't even think, on the 

Wurms, I don't think I ever corresponded. I think that was a 

letter from them to Marty with the photos of the island. 

Q There was a meeting with^^^^^^^^^^fand Colonel 
North that you described earlier. 

A Yes. 

Q Would you tell us how that came about? 

A Yes. One of the things that — Channell had 
certain people he wanted to meet, not only people in the 
Administration but heavyweights in industry. And he knew of 
my relationship with the^^^^^^^^^^^^^^lwhich is very 
close, and had expressed a desire to 
involved in the SDI program. 

And what he wanted to do was to go out and meet 
And at this point, I had had enough 





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experiences with Channell to know that I did not want to 




introduce^^^^^^^^^irectly to him. I was willing to help and 
see if I could get him involved in SDI, but I decided to 
handle that myself. And I believe I did this without him 
even knowing it . 

[was being visited by an official of 
thel^^^^^^^^^^^^^^^^^^^^k^n*^ ^ — ^ arranged for 
I mean he went on a standard tour of the White House. And 
afterwards I met^^^Hand we did a more extensive tour with 
him and this official 





So^^^^frnd 1 and this gentleman! 
and his wife got together after their tour. We did a West 
Wing tour. This was on a Saturday. And then we walked back 
to the hotel . 

We discussed some of the public education programs 
that I was involved with and, in particular, we talked a 
little bit about the SDI program. And I kind of said do you 
ever get involved in these kind of things?! 

has had 

an aversion to doing much of that. He told me, without going 
into all the details, that his policy was not to get too 
involved in too many specific issv^*s. Matter of fact, he 

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didn't even get involved with specific candidates unless 
there was a real reason to get to, until the person had the 
nomination of the party. And then he didn't mind giving 
money. 

And he just explained that everyone was always 
looking^^^^^^^^^^^^^^^^^^^^^lfor i 

believe we talked about what had been going on in these other 
TV commercials, and I said, look, there is this other program 
that wants to go, and would you mind if I brought somebody 
out just to give you a briefing on what's going on in Central 
America? 

And he said sure, and he said just give me a call. 
So I gave him a call. I called North up and asked him if he 
wouldn't mind giving the slide presentation dog and pony show 

Now, by this time, the whole Central 
American thing is winding down, and SDI is real high on the 
list. And so my thought was — 

Q The dog and pony show was to be — 
A I'm sorry. North's dog and pony show, the slide 
show. 

Q On Central America? 
A On Central America. 

And my feeling was that we would be able to show 
him what was done on this issue, and then talk about this 
infancy program of the SDI that we could maybe whet his 

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interest. 

So we went out and had the dog and pony show. We 
actually took the slides out, and we talked about the whole 
Central American issue. And after the briefing was over 
with,^^^^^^^^^^^^^^^^nd called^^^Hjp to the 
SDI program and what he had seen in the slides. And I said, 
look, I've thought about this a lot because of what you had 
told me about what your policy is and also because we're good 
friends . I think for you to take a position on an issue that 
has an equal amount of support and people who are against it 
would be a mistake for you personally. But, business wise, 
since your name is on the company and you are a publicly- 
held company, and your stockholders can get pretty upset with 
you if, all of a sudden, you are out there spending money for 
television commercials, urging public support of a particular 
program with the President. 

And he laughed and said he had already come to the 
same conclusion. And that was really the last we talked 
about it . 

Q So, as far as you know, no one ever specifically 
asked him for a contribution for anything? 

A No. Because I'll tell you, to the best of my 

recollection, I don't believe I ever told -- I may have told j 

i 

Miller I had the meeting, but I don't believe I told -- I i 
don't know even if I told Rich, because I decided, and 



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^^^^^^H had independently that he was not going to do 
anything in SDI; that I just dropped it. And I just don't 
think I ever told any. 

He wanted to meet Joe Coors, Channell, I mean 
there's a whole list of people that he wanted to meet with. 
And they just didn't happen. 

Nqw, he may have met some of those people using 
other avenues and other consultants. But not with me. 

Q In the course of your relationship with Mr. - 
Channell — first of all, can we put a date on that meeting 
with! 

A I'm going to say approximately April of '86. 
Q In the course of your work with Mr. Channell, you 
set up a number of meetings, or you set up some meetings with 
Elliott Abrams . 

A Yes. Well, no, I didn't. But I attended them. 
Q You attended some meetings with Elliott Abrams. 
All right. 

And you mentioned that Mr. Abrams was one of the 
people that Mr. Channell originally said he wanted to meet 
with, correct? 

Can you tell us how those meetings were set up? 
A Yes. Artiano enjoyed a personal relationship that 
went back, I think, before the campaign, or maybe they worked 
together in the transition. But anyway there was a personal 



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relationship between Artiano and Abrams. 

So when it came time for arranging that, he did it. 
Elliott Abrams probably knew who I was, but I don't think we 
had ever met than maybe, you know, when he was over at 
meetings in the White House I may have, you know, introduced 
myself. But Marty took the lead on contacting Elliott. 

And the only ones I was involved in were two 
meetings. One was a luncheon at some restaurant in town, and 
there was Abrams, Artiano, Fischer, Channel 1, maybe Frank 
Gomez. I don't know whether Frank was there or not, but I 
can't recall that. 

And the purpose of that meeting was a get acquainted 
session and for Elliott to be briefed on what these guys were 
doing in this public education effort and, you know, basically 
get acquainted. 

There was a second session that was requested by 
Channel 1, and this was months later, in which, as I recall, 
he wa» getting the words from contributors that the President 
w«i^ about to radically change his position on Central 
America. And the contributors who were calling in were angry 
with the President. I don't know if there was a news story 
out or what . 

So Marty arranged, at the request of Channell, a 
meeting with Elliott in his office, and it was to find out 
what was going on so Channell could call his contributors 

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back and say, yes, it's happening, or no, it's not. 

And as I recall, it was like a 10-minute meeting, 
very, very brief. And it was one of those times where 
Channell was a little contentious. And he got the answer he 
wanted that, you know, the President in fact wasn't changing 
his mind on Central America. 

But it was one of those meetings that didn't go 
well. And I know Marty and I at the end of it both came to 
the conclusion that's it, you know, we're never going, you 
know — Marty was not willing at that time to ever call Abrams 
again because of the result of that very brief meeting. 

And if I'm not mistaken, Elliott was a little put 
out too. 

Q Was there any discussion at either of those 
meetings, or to your knowledge at any point with Elliott 
Abrams of ACT or NEPL supplying the direct financial assis- 
tance to the Contras? 

A No. And I got the distinct impression that the 
reason for the lunch was they didn't know each other. And 
this was an opportunity for them to get to know each other. 

Q Were there ever any requests to set up meetings 
with Vice President Bush or his staff? 

A In reviewing again the documents that they gave me 
for their activities in '85, I ran across correspondence that 
showed that they had met with the Vice President. And they, 

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meaning Miller and Channell, had met basically directly with 
Bush and people on the staff. 

And while the letter didn't say what it was for, 
they later told me as one of the things that they wanted 
assistance on was they wanted to put together a series of 
dinners around the country for the Vice President with people 
that I think they described as people who wouldn't normally 
be supporting the Vice President, but people who would be 
opinion leaders in those States. And the purpose of this 
would be he would go in, have dinner with these people in 
their home — there would be a small group of people. He 

would give a speech on foreign affairs or domestic 

whatever they wanted to talk about. And there would be a 
question and answer session. And they even talked about 
having, whoever the agency was that handled Channell, Goodman 
or Goodman Agency, that did their commercials, would go to 
these and film the speech and also the QSA session so the 
Vice President could use it for whatever purpose he wanted 
to, that he would have all of these different speeches and Q's 
and As on tape. 

And that basically was the program. 

Q Were you involved in setting up those meetings? 

A No. Because it happened before. And the correspon- 
dence, I think, was already in after the meeting requesting, 
you know, is this going to take place? I believe made some 

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phone calls into the Vice President's office to find out that 
it was the political — by this time, he had "Bush in '88," 
or whatever they called their group -- that they had decided, 
the politicals, that they were going to handle those kind of 
meetings, and it was basically turned down. 

Q Let me show you what is marked as Deposition 
Exhibit 5. 

[A document was marked for identifica- 
tion as Fischer Deposition Exhibit Na. 
5] 
BY MR. McGOUGH: 
Q Take a look at that. It's a letter on the station- 
ery National Endowment for the Preservation of Liberty, dated 
February 12, 1986, to Vice President Bush, signed by Spitz 
Channel 1. 

It proposes the types of dinners that you described, 
and then the fourth paragraph says, "If you could spare a few 
■oaents, Marty Artiano, David Fischer, Rich Miller and I 
would like to discuss seminar subject matter in your personal 
preference of format." 

Do you know if in fact that meeting ever took place? 
A If it took place, I wasn't there. 
Q Were you aware that this letter had gone in? 
A I can't recall this. I really can't. I mean I 
just recall tliat they were moving forward. And my recollec- 

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tion was the vice President's office said no. Not his office 
so much as the political office. I mean his campaign had 
decided that this was more a campaign activity and they would 
be handling that, you know, from Atwater's shop. 

But, you know, not to say that that didn't happen. 
They may have had a meeting. I don't think so because the 
whole issue died. At a certain point it was never even 
discussed again. 

Q Who were your contacts in the Vice President's 
office on this issue? 

A It may have been Craig Fuller, but I don't know 
that I even spoke to him or one of his assistants may have 
called back. Or I may have even talked to Lee Atwater or one 
of his aides in the campaign. I mean it was either somebody 
who worked for Fuller or somebody who worked for Atwater. 

Q Were you ever asked to set up a meeting with 
Senator Dole? 

A They had a program identical with this for Senator 
Dole. And I don't that I was asked to set up a meeting other 
than to help put together the same kind of program that they 
wanted to go forward. 

I believe that he met with Dole. And I know at one 
time I had called over there to arrange a meeting to talk 
about this. But I didn't happen or it got canceled, or 
something. And then I think, independently, you know, again 



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I'm just trying to recall, I think independently he did get 
his meeting. I had put in a request with the Senator's 
office. 

MR. McGOUGHj Mark this as Exhibit 6. 

[A document was marked for identifica- 
tion as Fischer Deposition Exhibit No. 
6] 
BY MR. McGOUGHt 
Q For your information, this is a copy of a sheet of 
telephone messages from on or about August 7, 1986, from 
Channel 1 organizations' telephone logs. 

In the upper left-hand corner, there's a message, 
what appears to be a message from you to COC, which would be 
Mr. Channell. The first line says, I think, "Will call 
tonight at home," or something to that effect. And then the 
bottom line says, "Dole meeting looks good." 
A Yes. 

Q Does that correspond time wise when approximately 
you were trying to set that up? 

A You know, I believe it was about this time, you 
know, summer or late summer. 

See, I don't even know who I called. I think I 
called into his secretary, meaning Dole, and there was a time 
when it was real close to happening. But I think, oh, yes, 
he was the — this couldn't have been, '87 — this had to be 



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'86. Oh, I'm sorry. I'm just looking at your date that you 
put on there . 

Because he was still the Majority Leader then. And 
there was some kind of problem there, something going on, 
that the meeting got scheduled, it got taken off, or it got 
reduced from like 20 minutes to five minutes. In other 
words, it just wasn't working out. 

And my recollection is that it kind of got put on 
hold. And then I was later informed that he got his meeting. 
But I don't know how it happened. But it was. on the same 
subject. They wanted to do dinners for Bob Dole. 

Q Did you attempt to set up meetings with Charles 
Wick? 

A Yes. Not only tried to, but did. 

Q Can you tell me what those meetings were about? 

A Yes. They wanted to meet Charlie Wick and to tell 
him again about all of the commercials, but also the documen- 
taries that they had been filming down in Central America. 
And Charlie and I were good friends. And I told 
him about this group, sent him over all the tapes of the 
commercials, the compilation of the tapes. And he reviewed 
that material. And we had a lunch, and it was a lunch with - 
- Charlie Wick knew Frank Gomez because Frank had been at 
USA, so it was Channell, Charles Wick and Frank Gomez and 



Miller. 



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And again it was one of these get acquainted, this 
is who we are, and they talked about all their programs and 
where they wanted to go with them and, you know, sought his 
advice and counsel on -- basically get acquainted. 

Q How long have you known Mr. Wick? You said you've 
known him for some time. 

A Since the campaign days. I got to know his wife 
fairly well, and then the campaigns with Charlie. And they 
were around the Reagans socially, so whenever they were 
together, I would be around. 

Q Did you set up a meeting with Attorney General 



Meese? 
A 
Q 
A 



Yes. 



Can you tell me how that came about? 

Yes. That had to do with their Constitutional 
Minutes program. The Constitutional Minutes program was a 
very expensive education campaign on the Constitution. And 
their concept very briefly was that they wanted to do TV 
coMBercials very different from what they thought the AB and 
other people would do. 

They wanted to take portions of the Constitution 
and show how it affected people in their average everyday 
life. So it was going to be kind of geared towards the 
average people and this is your Constitution, and because 
this is in the Constitution, this is why your life in America 



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is better. 

They even wanted to go so far as to do cartoon 
commercials for Saturday morning television for children. 

So it was definitely my judgment that the Attorney 
General be briefed about this. And so we set up a briefing - 
- I believe again this was In April — with the Attorney 
General, sent all the tapes and all the documentation over 
ahead of time. But what he wanted to do, and I got this from 
the staff, was he wanted his staff and me to see the commer- 
cials with Channell and Miller and everybody there. So we 
went to the Justice Department at the conference table in his 
office, and he was surrounded by his aides, and Marty Artiano 
was there and Channell and Miller. And we sat for the first 
part and watched all the commercials. 

And then — this program was really at its infancy 
at this time and they — Conrad was there too, because the 
Constitutional thing had always been kind of described as 
Dan's original idea. So Channell and Conrad briefed the 
Attorney General and his staff on what they wanted to do, 
only in much greater detail than I'm telling you. And even 
though, you know, that it was a year and a half away, that 
they were going to raise millions of dollars, and this is 
where they were going with it. 

He talked about Constitutional writers, you know, 
who would be the kind of people to see. And they talked 

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about the kind of people that they wanted to put on their 
Board of Directors, and it was basically this is where we are 
and this is where we're going, and what do you think? 

Q Was there any specific action act asked of the 
Attorney General at that time, or was it information? 

A Well, I don't know if it was at this time but, 
later on, what they definitely wanted was Ed to serve like an 
Honorary Chairman or something like that, and also to sign a 
letter endorsing the project. 

And later on, this was much later on, there was a 
request that he speak at a gathering of people who would be 
supporting this which, you know, he agreed in principle to. 

Q Was that the only meeting that you're aware of with 
the Attorney General? 

A I had subsequent meetings over there not with 
Channell. I believe that was the only one that we ever had. 

Q Were your subsequent meetings with him related to 
Channell or his organizations? 

A Yes, on the Constitutional Minutes Program. 

Q What was the substance of those? 

A It was progress reports. And a lot of times, it 
wouldn't even — not a lot of times — it was more meeting 
with people like Kenny Cribb and John Richardson. John 
Richardson was his Chief of Staff. And wb would talk about 
where they were going and the timetable, and when it came to 



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talking about a letter and a meeting where Ed would speak, 
that was strictly done with the staff. 

Q Old you set up a meeting for Mr. Channell with 
William Casey? 

A Yes. 

Q And what was it? One of the projects that — first 
of all, let me back up. 

How long had you known Mr. Casey, or did you know 
Mr. Casey? 

A Yes, I knew Bill very well from the campaign. I 
mean I got to know him when he came onboard, you know, when 
we had the first campaign team serious organization, when 
that vacated, Casey came in and ran it. 

And so I got to know Bill very well during the 
campaign, the 1980 campaign. He came on, I guess, in about 
the New Hampshire primary, February of 1980. 

Q Were you responsible for setting up the meeting? 

A Yes. 

Q Between Mr. Casey and Mr. Channell? 

A Yes. 

Q What was the purpose of that meeting? 

A The purpose of the meeting was Channell, one of the 
things that he wanted to do other than — he had documentaries 
on Central America. He wanted to do a couple of documentaries 
on t(^ successes of the Agency and, in order to do that, he 

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had to have the Agency aay, look, these are the kind of 
accomplishments that we can even talk about. And he evidently 
had someone, he told me, who was going to give the first half 
million had already been committed to the project. 

And so he wanted to meet Casey and tell him about 
the program. And so I called Bill and set up the meeting. 
And I attended it. 

Q When did the meeting take place? 

A I am going to say spring — you'd have to check my 
calendar — but it's spring of '86. 

Q And where did it take place? 

A In Mr. Casey's EOB office. 

Q What happened at the meeting? 

A Hell, I went in first and had a meeting with Bill 
just to tell him, you know, a little bit more because, before 
that, there had just been a telephone request. And so I went 
in to tell him about the group, tell him about the commer- 
cials, and to tell him briefly that the guy was going to come 
in and talk about — told him what the request was going to 
be, just to give him enough warning about what was going on. 

And then we brought Channell in, and he talked 
etbout his program and what he wanted to do. 

Q What, if anything, did he ask of Mr. Casey? 

A He wanted to know if Mr. Casey would endorse such a 
project and if it would be possible to get — in order to 

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nake it happen, he'd have to have some kind of cooperation. 
Someone in Public Affairs or whatever office who would handle 
that would have to, you know, give them the rough material 
that could be used to film the documentaries . 

Q Did Mr. Casey agree to that? 

A Mr. Casey smiled. No, he did not. He thought it 
was a wonderful idea and he would certainly discuss it with 
his staff. I don't know just exactly what was said, but this 
is kind of it, and that a wonderful idea, talk to my staff, 
and we'll get back to you. 

I knew that nothing was going to come about, and 
nothing did. 

MR. HcGOUGHt I think this would be an opportune 
time to break. I probably have another half hour, 45 
minutes, and I have a fire I have to put out at this point. 
[Recess for lunch] 



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AFTERNOON SESSION 
Whereupon , 

DAVID C. FISCHER 
the witness on the stand at time of recess, resumed the stand 
and further testified as follows: 

EXAMINATION BY COUNSEL FOR THE 
SENATE SELECT COMMITTEE (resumed) 
BY MR. McGOUGH: 
Q Mr. Fischer, I purposely left off until this point 
of the deposition discussion of the evolution of your 
arrangement with IBC, because I wanted kind of to lay the 
"big framework" and talk about some of the specific things 
you did. 

We've been told by you, and by other witnesses, 
that there were several phases as far as the financial 
arrangement, and the specific nature of the agreements that 
you had with IBC, and we have established the basis of the 
original agreement. 

There came a time, did there not, very early in 
1986, when there was a restructuring, or a change in the 
financial arrangement from a straight $20,000 a month retainer 
to something else, is that fair to say? 
A Yes. 
Q Could you tell me why that came about, and what in 



fact came about. 



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A Sure. In early '86, Artlano and I, particularly, 
had discussions about my future in Washington, and how I was 
going to operate, and we knew that we'd be moving back soon, 
and I was in the process of trying to decide which direction 
to go in, and as far as a permanent base of operation. 

And Marty talked to me about — and eventually, this 
led to discussions with Richard Frank about the possibility 
of forming a more permanent relationship with IBC. And these 
kind of discussions went on over some period of time, and it 
was something that Marty was a great advocate for, and that, 
frankly, I saw some advantages to it because of the difficul- 
ty of working just as a single person, you know, handling 
your clients, and sometimes, the needs of the clients became 
greater and you needed more assistance. 

So I saw the benefits to it. Over ft period of 
time, discussions were held about the possibility of forming 
this association, and eventually, as you know, it did take 
place, and it was formalized in a document in July, I 
telieve, of 1986. 

Ongoing with— well, that's another subject. Let me 
just stop there and let you ask the questions . 

Q To refocus you, was there a time in or about 
January of 1986, when payments by IBC to you and Mr. Artiano 
increased over and above the $20,000 monthly retainer? 

A There were bigger checks . The relationship at that 

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time was still the same. It was a relationship with IBC, a 
commitment over a long period of time. 

Q And that was a 2-year commitment at $20,000 a month? 

A Correct . Yes . 

Q That was not the schedule on which the payments 
were made, is it fair to say, over the — 

A That's correct. 

Q In 1986, you were not receiving $20,000 a month? 

A No. 

Q Why not? 

A There were times when acceleration was requested. 

Q Was requested by whom? 

A I'd have to say in the initial phase, like there 
was an acceleration end of January. That came as a part of a 
discussion between Marty and I, and I believe Marty made the 
request. In the early stages, as I said before, Marty was — I 
don't want to use the word business agent because he was a 
partner in this client, but his part of the responsibility 
was defining the relationship, and had far more communication 
with the principals than I did. 

Now eventually that changed, but in the initial 
stages, when there were things to be discussed, Marty and I 
would discuss it, and Marty would take it in and talk to Rich. 

Q So throughout this period there were discussions 
that Mr. Arti^o would have had with Mr. Miller to which you i 



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were not privy? At least you weren't present when the 
conversations took place? i 

A That's correct. Now those may have been in person, j 
or phone. I have no idea how they took place, but I just | 
know that he did have communication, independent of my | 
communication. 

Q Now you said you and Mr. Artiano discussed ac- 
celerating payments, and then he eventually took that as a j 
request to Mr. Miller. Is that correct sequence there? - | 

A Correct. ; 

Q Can you tell me when you first had these discussions | 
with Mr. Artiano. 

A They would have to be some time in January. , 
Exactly when, I don't know. What was happening is that what ; 
was being asked for, and the projects that were now being 
envisioned greatly exceeded what we had anticipated was 
originally to take place, and, frankly, there was a fear on 
his part, and frankly, mine, too, even though I hadn't — 

Q His being Mr. Artiano? 

A Marty. Mr. Artiano. A fear that in Washington, 
when you have clients — today you have a client and tomorrow 
you don't. I mean, things are very volatile, and because you 
have a permanent arrangement doesn't in fact mean that that's 
what's going to take place. 

A client can become dissatisfied with your perfor- 



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mance and just end the relationship. And that frankly, one 
of the things--because we were very new into this relation- 
ship, Marty and I were both concerned that maybe this may not 
be going on as long as we thought. And so that was the 
discussions we had, and it resulted in Marty making a request 
for acceleration. 

Q Now this was less than one month, or approximately 
one month into the original relationship? 

A Right. Probably the second month because I think 
we started some time in December. 

Q And started some tine in December, and some time in 
January you were already discussing recutting the deal, is 
that fair to say? 

A No, I don't think it's recutting the deal; it's 
just accelerating the payments. In other words, a commitment 
had been made, a long-term commitment, and for that, I was 
going to work, as far as PR effort, just with IBC, and not 
affiliate, even informally, with any other group, and so that 
part had not changed at this time. 

Q But we can agree there's at least an appreciable 
difference between $20,000 a month for over the space of two 
years, and accelerating those payments up into a single year, 
or whatever the term was that was ultimately agreed on? 

A Yes. Even though I'm not so sure what his discus- 
sions were with Rich. Obviously, an acceleration was 

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perfectly acceptable to IBC because they made the payment. 

Q From your standpoint, why was an acceleration in 
order? 

A Again, what was requested from IBC started to 
exceed what our original expectations were. 

Q In what sense? 

A The workload was getting heavier. In other words, 
it's a far cry from initially talking about introducing their 
client, Channell, to Frank Fahrenkopf , or Paul Laxalt, or 
Elliott Abrams, just to describe their meeting, to all of a 
sudden, now, can we do this briefing, we could like to do a 
briefing, and we want to do Constitutional Minutes, and we 
want to do SDI . And their so-called "wish list" started 
going into the pages and pages of things that they were 
interested in doing. 

And so it was really based upon that that--you 
know--in partial, and a concern that maybe this thing would, 
say, maybe would not be around forever, that the request was 
put in. 

Q Well, let me see if I can get you to be a little 
bit more specific. What did you understand in December of 
1985 that you were going to be asked to do, and how did that 
change in January of '86? 

A As I've said before, the initial discussions had to 
do wi^h increasing the visibility of their client, IBC's 

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client, Channell, originally, with some of the people that I 
mentioned, and it was not in the early stages — 

Q Essentially by setting up meetings, is that fair to 
say? 

A Well, sure. Introducing them to the kind of people 
that they wanted to meet, to describe their programs, and 
where they wanted to go with those programs. And all of a 
sudden, very quickly, it evolved into something much bigger, 
and the projects went from the discussion stage to specifics, 
and we had — very soon we were involved in a dozen projects. 

Q Was there any attempt made in December of 1985 to 
get a written agreement as to what you were doing for the 
$20,000 a month? 

A No. 

Q It was just all an oral basis only? 

A Yes , as were a lot of the relationships that we 
entered into on other clients, meaning Marty and I. 

Q In January of 1986, was there any attempt to get in 
writing exactly what you were supposed to do, and how much 
you would be paid for it? 

A No, not to my recollection at all. I never 
requested it. 

Q How did you understand, or what did you understand 
to be the proposal as far as acceleration went? 

A How did I understand the proposal? 



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Q What were you and Mr. Artiano asking IBC to do? 

A Well, Marty put in a request to increase the 
payment . 

Q But it was at $20,000 a month. To what did he want 
to increase it? 

A On that he made a specific request for 25 apiece. 

Q So a S50,000 increase, or $50,000 monthly total — 

A No, no. It was just a one-shot--you know — can you 
accelerate on this date? 

Q So it was a one-shot $50,000 acceleration? 

A That's my understanding of it. 

Q And was that to be in addition to the regular 
$20,000 per month retainer? 

, A I believe at that time that the January payment had 
been made. I'm not too sure what the anniversary day — maybe 
it had been or hadn't, but I believe it had been made already. 

Q Was anything further asked in the way of accelera- 
tion other than the front-loading $50,000? 

A Not at that time, no. 

Q Was there any proposal made to compress the entire 
$240,000 up to the first four months of '86? 

A 

Q Compress the whole contract? 

A No, not that I ever recall. I remember that 
specific request--you know — in the month of January. 



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Q When this proposal was made to Mr. Miller by Mr. 
Axtiano--! don't know whether you were there, or not--but did 
you learn, either at that time, or at a later time, that Mr. 
Miller relayed that request to Mr. Channell? 

A I don't know that it had — our relationship was with 
IBC. It was a commitment from Rich Miller and Frank Gomez 
for a long-term relationship with IBC, not only on this 
client but on other clients of theirs, and so the request 
just went to him, and that's as far as it went. I mean, as 
far as I know. What his internal mechanism was, I have no 
idea. 

Q But you certainly were aware that he had to pass at 
least a portion of that on to Mr. Channell? 

A Oh, sure. I knew that he was billing Channell for 
a wide range of his activities, and the activities were 
related to Fischer and Artiano. 

Q Were you aware that he was passing your fee through 
to Mr. Channell? 

A Was I personally? I just assumed that he was. I 
mean, I don't have — you know — I don't have--again, in the 
initial stages, I don't recall ever having money conversations 
with anybody other than Artiano. j 

Q But you assumed that he was passing it through? 

A Yes . 

Q And it was Mr. Channell 's work that initiated your 



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request--by you I mean Mr. Artiano's — your request for 
acceleration, and not any other client that IBC might have 
had? 

A That's correct. 

Q So you also would have assumed, would you not, that 
any additional incremental, or any accelerated fee would also 
be passed to Mr. Channell? 

A You know, that might be a fair assumption. 

Q Do you know whether Mr. Miller discussed it with 
Mr. Channell? 

A No. I don't. Channell 's and Miller's relationship 
was something that they discussed. What their financial 
arrangements were, how they ran invoicing, how they did 
bookkeeping, I, at that time, and never did know, how he ran 
his business. 

Q Do you ever recall being present at a meeting with 
Mr. Miller and Mr. Channell, and perhaps other people as 
well, but specifically those two, at which fee arrangements, 
your fee* arsangement w^s discussed? 

A There was one meeting that did take place and it 
was as a result of a request by Marty, and it had to do with- 
-I don't know when it was, or how I came to hear this, but 
there was — someone had said that there was a specific 
arrangement, financial arrangement tied to meetings, and 
there was a meeting held with everyone and it was in a 

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conference room at IBC, in which that was discussed, in which \ 
Marty took the lead on the meeting. j 

And about the only thing I can recall is that, you 
know, he raised the issue, and, you know, recapped what the 
relationship had been from the beginning, and, basically, 
straightened out the arrangement. 

In my recollection everyone concurred that, you 
know, our arrangement was as he said it was, and that was 
pretty much — that's the only time I ever remember being in 
one big room, discussing money, with Channel 1 in the room and 
Miller in the room. 

Now I can tell you about later conversations that 
Channell had with me, but as to that one meeting, everyone in 
one room, there was that one meeting that I recall. 

Q Do you recall when that took place? 

A I don't. Very early in '86. 

Q Do you remember whether it was before, or after, 
the January briefing? 

A I'm sure it was right after. You know, I don't 
think it could have been before because there were no — the 
January 30th briefing was the first meeting that was even 
held at the White House. You know, I would assume it would 
be after January 30th. 

Q Do you recall when this proposal for acceleration 
was being floated, Mr. Miller coming back to vou, and perhaps 

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Mr. Artiano, and asking about the ability to schedule photo 
opportunities or meetings with the President, in the context 
of your request that payments be accelerated? 

A No, because I think that the mention of the pos- 
sibility of photos with individuals happened even prior to 
the January 30th meeting. At some point — you know — I don't 
know when it was discussed, but it was all right around the 
time of the' January 30th meeting. 

Q But some time in January, prior to the January 30th 
meeting, there were discussions of acceleration, is that fair 
to say? 

A Yes. 

Q In the context of those discussions, do you 
remember Mr. Miller coming back to you and saying, what is 
your ability to produce, or to get people in to the President? 

A In the context of acceleration, no, because, again, 
I don't remember having any conversations about acceleration. 
That was something that Marty handled, and, you know, at this 
stage of the game I was not involved in money discussions. 

Q Do you ever recall Mr. Miller indicating to you, 
or, to your knowledge, Mr. Artiano, in substance, that in 
exchange for acceleration of the payments under the contract, 
Mr. Channell would like to see White House meetings? 

A I don't recall anything like that. 

Q Do you ever recall him coming back and asking you, 



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on behalf of Mr- Channell, in the context of the acceleration, 
whether it would be possible to schedule a certain number of 
White House meetings? 

A No, because, again, I never remember talking to 
Rich about acceleration at this time at all. 

Q Do you recall a discussion like that at the same 
time, or in the same timeframe as when the request for 
acceleration was on the table? 

A No. Again, I don't recall discussions about 
acceleration other than with Artiano. 

Q But' thejre was a time period where that was on the 
table, and you were also having other discussions with Mr. 
Miller. Do you recall having discussions about presidential 
meetings that proposal was on the table? 

A While that was on the table? You know, i just 
don't know the timeframe of when that was. You know, I 
believe that individual photo opportunities may have very 
likely been discussed in January. I don't know for sure. 
I'd have no way — I don't have a piece of paper that says it 
happened, but I believe it would have been in January. 

And so the timeframe, I just — I don't have anything 
that can help me, one way or another. 

Q Just so we make sure the record is clear on this 
point, was there ever, to your knowledge, an offer or 
agreement to produce, or to schedule meetings with the 



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President in exchange for any fee, any set amount to be paid 
to you or — 

A That kind of proposal was never discussed, that I 
can ever recall. Now there's no question--and I'll make it 
real clear — that those kind of photos certainly became part 
of the things that were asked for and that I agreed to do, 
and that did become part of the responsibility. But it was 
not discussed, initially. 

It soon became part of the things that were 
discussed, and I did agree to that, after checking it out, 
and that it was — you know — and I found that in fact it could 
take place. And as I've said, and in fact it did occur, and 
occurred as late as last October. 

Q And with whom, again, did you check it out? 

A Don Regan. And again, then, I told you before, the 
process under--how which they were actually implemented, but 
for permission, that was directly from the chief of staff. 

Q Between January and June of 1986, were there any 

other changes of significance in your relationship with IBC, 
other than this one-shot acceleration of payment, $50,000? 
Were there any other modifications? 

A Another acceleration? 

A Were there any other accelerations? 

A Yes. There was an acceleration. 

Q And when was that? 



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A That took place in April and that was for — and that 
was on© that I specifically asked for, for 50,000. 

Q And why did you ask for that? 

A Two reasons. At the time, January 1st was the 
official cutoff with the relationship with — the salaried 
relationship with Huntsman Chemical. I had a transition 
period from December to April 1st in which I was still on 
salary with Huntsman, and it was a transition period in which 
I was able to go out and to put together a business. That 
ended on April 1st. 

We had a very large payment due on a note in Utah, 
a payment of — what was it? 25,000, or 25,000 plus interest, 
or 20, plus interest — anyway, it was a large payment, and we 
needed an extra infusion of cash to not only take the money, 
pay the taxes on it in our quarterly statement, and to make 
the payment to the bank. 

Q We being yourself and your wife, or yourself and 
Mr. Artiano? 

A No, no. I'm sorry. ; It was a personal note my wife 
and I had. It had to do with our residence. There was an 
extra note on the house that was due in April. 

Q And the work that you were doing for IBC changed 
significantly between your request for acceleration in 
January and the request in April? 



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Q How? 

A The activity increased, and also — well, more 
activity for Channell. But also, at this point, we were 
beginning serious discussions about a permanent, or more 
permanent relationship with IBC. You know, the talks went on 
for months, and this was going on about this time. 

Q Did you yourself — 

A Let me give you some specifics on Channell. 

Q Sure. 

A By this time, SDI was really going. You know, the 
initial part--you know — the January 30th had to do with the 
contra issue, and, you know, now by the time we're into April 
the vote's coming up, and that is now not as important as the 
SDI program, as the Constitutional Minutes, and, you know, 
they were beginning to start focusing on other projects that 
they wanted to get instituted. Not only those. The Reagan 
Library. 

They had — I can give you ten more, other projects, 
totally unrelated to this, that were now all ongoing, and now 
we're into the area of bigger — of much bigger "wish lists" of 
things that were to be accomplished, or what they would like 
to accomplish. 

And so the activity was increasing, and we also 
had, at the same time, you know, discussions about formulating 
this association, I'll call it 



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Q But at that time, in April of 1986, again, there 
was no attempt to reduce the agreement, at that point, to 
writing? 

A No. It was all — you know — it was leading up to 
that, and that was one of the things that Marty was helping 
on. 

Q Was it your understanding that the two advances of 
$50,000 that had taken place up to that time were that, were 
advances from the back end of the two-year term? 

A Yes. 

Q Was there any discussion, at that point, in April 
of 1986, at or about the same time that you were discussing 
the second $50,000 advance — was there any discussions of 
setting up meetings with the President for contributors? I'm 
not linking them in any cause and effect relationship. 

A In fact do that all over again because I was 
daydreaming for a second. 

Q At that time, in April of 1986, were you also 
discussing with Mr. Miller and Mr. Channell, and Mr. Conrad, 
setting up meetings with the President for contributors? 

A Oh, they had already taken place. It was an 
ongoing process. 

Q And there were still some to take place, is that 



fair to say? 



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Q Did anyone ever express any linkage between the 
April payment and any future meetings with the President? 

A No. I don't ever recall that kind of discussion, 
no. 

Q How about any past meetings with the President? 

A No. 

Q Did you conduct those negotiations yourself, or was 
that, again, Mr- Artiano? 

A No. On that acceleration? 

Q Yes. 

A No. I believe, on that one, I asked Rich. By this 
time Rich and I had started to establish a working relation- 
ship. Prior to this — you know — in January, I didn't really 
know him very well, my contact had been very infrequent, and 
by the time April came along, we had a pretty good working 
relationship, and had been through a lot of different 
meetings and that, at that point. 

Q Am I correct to assume that, when we talk about 
$20,000 a month, or these accelerations of $50,000, these 
were all being divided, 50/50, between you and Mr. Artiano? 

A Yes. And let me just throw another complicating 
factor into this thing, and another reason that we started 
these discussions on a permanent relationship. 

Throughout this time there were — Spitz Channell 
would take me aside after a meeting — and I can't give you the 



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timeframe — but it was early on, in which he made an offer for 
me to join his business, and offered a lot of money on 
different occasions. 

And the idea was, let's pull away from IBC — you 
know — we'll set you up here, and you'll be working with us 
and for us, but only on our projects. And those, the first 
amount he offered was $40,000 a month, and then it became — you 
know — anyway that goes on later, on discussions I had with 
him. But this was going on in the same time period. 

In other words, Channell was very interested in 
having me affiliate with him, and wanted to deal with me 
directly, rather than dealing with me through Rich Miller, 
and, frankly, just wanted to have, you know, a certain amou' . 
of time devoted directly to his organizations. 

Q Again, leading up to June of 1986, were there any 
other changes or accelerations, or restructuring of the 
relationship, other than the ones we've referred to? 

A Some time in that time frame, there was the discus- 
sions with Artiano and Rich about forming this permanent 
relationship with IBC. We were talking specifics, and how 
the thing was to occur. One of the points that was being 
discussed was a real point of interest to both the IBC side, 
and mine, was that what clients go into the association. 

Do we take our existing and put them into the pot, 
or is it just new clients that we bring in? Does that become 



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the basis upon which we form this association, in which we 
have the fee-splitting arrangement that is in the contract? 

And at the same time this is going on, I have 
gotten to know Channell a little bit better, and he has 
already made several attempts to get me to come and join 
them. And I learned a little bit more about how he operated 
in that you could fall in and out of grace with him fairly 
easily. 

You know, if he was not pleased with the work' 
product, one day you may find yourself on retainer and the 
next month you may not. And I knew that he and IBC had had a 
long-term relationship, but there was some concern about what 
was going to happen after the vote, and if the contra thing 
passed, and they were no longer needed on this issue. 
Exactly, of all the different consultants that Channell had, 
who was he going to keep, and who was he going to use? 

We came down on, in the negotiations among the 
group on how to form this association with Fischer and IBC, 
with the decision that clients that you had ahead of time, 
prior to signing, were your clients, and anything that came 
on board, once the association was formed, or anything that 
you had that you wanted to put into the group because you 
could no longer do it by yourself and you needed the assis- 
tance — that, you know, those that are separate stay separate, 



the new ones go into the pot. 



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And so in this context, Channell — and I did have I 

think there were several discussions. I remember several 
times when he offered me, earlier on — come on board, and 
we'll offer you this. But he wanted me to disassociate from 
IBC, and completely be — I could still do other things, but on 
any of this kind of activity, be directly linked with his 
organization . 

I told Rich about that, and Rich knew what was 
going on, and what we eventually agreed on — his relationship 
with Channell — he, meaning Rich Miller — that was to stay 
separate. He and Gomez, they were going to continue doing 
that. 

And what I ended up doing was — and this, again, was 
something Rich and I talked about, and we basically or- 
chestrated it. I formed a separate agreement with Channell, 
still working through IBC. The reporting relationship, and 
all of that, maintained the same. 

And he again offered the large amount, went down 
to — he then offered 30,000 a month, and I said no. And I am 
the one that named the figure twenty. And 20,000 a month, 
that would be from the Channell organization, through IBC, 

and then IBC to Fischer. And that was something that I 

wanted to be very careful because I met all of these people 
through Rich Miller, that was his primary client, and we 
structured something that was perfectly acceptable to him 



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and still protected his client — he still had them — and then I 
had that separate arrangement. 

Q Now was this money to be split with Mr. Artiano? 

A Well, no. Once that got formalized, and, that was 
somewhere from--you know--I would say from around April time, 
you know, into June, when we eventually signed the agreement. 
My separate arrangement with Channell was going to 
be just that. It was separate. I was then — you know--we 
thought we'd be moving here, to Washington, a lot sooner. 
And so that was going to become a permanent working relation- 
ship at IBC. 

And Marty, at this time, was negotiating with Rich 
on some other ma,tters, and which did not concern me. He had 
some kind of other arrangement with Rich. And so once 
Channell and I agreed to that — and it was just an informal 
arrangement. Again, there was no contract. Once that got 
going, then those monies that went into IBC were earmarked 
strictly for me, and that money was mine and I did not write 
checks to anyone out of that. 

Q So coming to the end — and I 'm just trying to 
reconstruct this — coming to the end of that period, you had 
your agreement with IBC, unwritten, for $20,000 a month over 
two years, and you were receiving, in theory at least, you 
were receiving $20,000 a month under that agreement, which 
you would split 50/50 with Mr. Artiano, is that correct? 



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Yes. 



UNCLASSIFIED 



Q That's one element. 

A Yes. 

Q You also received two accelerated payments of 
$50,000, one near the end of January 19867 and one in or 
about April of 1986? 

A Yes. I got 25,000 on the first but I got the 
entire 50 on the April payment. 

Q So the January acceleration of $50,000 was split 
50/50 with Mr. Artiano? 

A Correct. 

Q The April acceleration was not? 

A Correct. 

Q But that was an acceleration of — 

A My agreement, or our agreement with IBC. 

Q But you didn't accelerate Mr. Artiano 's portion of 
that agreement? 

A I asked Rich to do that for me because I needed — 
you know — for the reasons I've explained. That had nothing 
to do with Marty. Now what Marty did on his acceleration, I 
don't know. He may have; he may not have. 

Q Well, did you understand that $50,000 to be 
deducted from the back end of your 24-month contract, without 
regard to Mr. Artiano's share of that $50,000? I mean, were 



they taking just your half of the- 



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A No, I considered that to be — you know — fulfilling an 
obligation to me. If it had been part of Artiano, I would 
suppose that I would have written a check to him for half of 
it. 

Q Was Mr. Miller aware of your 50/50 split with Mr. 
Artiano? 

A Again, I didn't discuss money with Rich, but I 
would assume that Marty probably told him about it. I think 
later on, you know, when we had subsequent discussions about 
things we may have talked about it. I'm sure that Marty 
fully discussed it with him, probably right up front. He had 
to know. He was writing the checks. 

Q At any rate, the $50,000, in April was not — there 
was no written agreement. You kept 100 percent of that 
$50,000? 

A Yes. 

Q There was then, a side deal that you had with Mr. 
Channell, again unwritten, is that right? 
A Unwritten. 

For $20,000 per month, which was billed through IBC? 

Correct- 

And transferred directly from IBC to you? 

Yes. 

And, again, Mr. Artiano did not share in those 



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A In that he did not, no. 

Q Up until the time where you set up a joint venture 
with IBC, did you receive any other funds from IBC, or from 
any of Mr. Channell's organizations? 

A No. I don't believe at all. Looking at my records 
we never--not we — my wife and I. David C. Fischer and 
Associates, in any relationship with the Channell organiza- 
tions, never took any money directly from any of Channell's 
organizations. 

There were — because I saw one of them flashed on a 
TV screen one time — supposedly some checks were written from 
one of their organizations directly to me for a monthly 
retainer, and it was sent over to IBC. IBC sent it right 
back and said, you know, this is — you know — it's made out 
incorrectly, make it out to IBC, and then — you know — and then 
we pay Fischer. 

The reason for that, it was Rich Miller's client, 
originally, and I wanted everything to go through him, and 
that's the way he wanted it, and it's certainly the way that 
I wanted it. 

Q I understand that, but my question really is an 
attempt to close the set on the income streams, if I can, 
prior to your entering into a joint venture. We've identified 
what I've called the three streams, which are the original 
agreement with IBC, two accelerations of $50,000, and the 



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side agreement with Mr. Channell. 

A Right . 

Q Other than those three streams, in the eunounts 
we've discussed, did you receive any additional income from 
IBC or from Mr. Channell? 



I believe that is — that was all of the accelera- 



tions . 



[Briefly off the record] 
MR. McGOUGH: Go back on the record. 
THE WITNESS: We discussed other client matters 
with IBC- I mean, he had other clients going on, and I was 
consulted about those, but I'm going to have to say that the 
compensation at this point was for the--was for his client, 
Channell. But I did participate — and specifically what they 
were I can't tell you — but he had other clients going at the 
time, and I would be asked, occasionally, you know, for input 
on some of those. 

BY MR. McGOUGH: 
Q Would you be paid? 

A But I would not say that I would be paid for those. 
He may have considered it part of but my — we started working, 
officially, on other clients, after we formed that associa- 
tion, but I did assist him on other matters. But I would 
call that more on an unofficial, kind of an ad-hoc basis. 
Q Let's go to the formation of the joint venture. 



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When was that? 

A I believe the date is like the first week of July 
of '86. 

Q And I believe Mr. Fryman's going to ask you some 
questions about that. Why don't we mark them as exhibits, 
since we're here. Mark them 7 and 8. 

[Documents were marked for identifica- 
tion as Fischer Deposition Exhibits Nos. 
7 and 8] 
BY MR. McGOUGH: 

Q Why don't you take a look, Mr. Fischer, if you 
would, at Exhibits 7 and 8. 

A Do you want me to sit and read this? 

Q No, no. Do you recognize them? 

A I've seen this a long time ago, yes. 

Q Is this the proposal for a joint venture, and then, 
ultimately, the joint venture agreement? 

A Yes. It's got my signature on this one. 

Q The joint venture agreement itself is Exhibit 7, is 
that correct? 

A Correct. 

Q And it's by letter dated July 7th? 

A July 7th and signed by Fischer and Miller. And 
then there's a separate page that's signed by Artiano. 

Q Is that agreement still in place between yourself 



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and IBC? 



UNCLASSIFIED 



A Yes. 

Q And have you continued to receive compensation 
under that agreement from IBC? 

A Oh, when was the last? I think there hasn't been — 

Q Let me back up. Through what date did you receive 
compensation? 

A February. - 

Q Of 1987? 

A Yes . I think that ' s probably about right . And 
maybe there would have been later. I have to — you know — 
again, you've got the checks. I think that was the last one, 
February. It may have been March. 

Q Did this agreement also supercede your agreement 
with Mr. Channell? The separate, the side agreement? 

A Supercede? No . 

Q So did you continue to receive $20,000 a month from 
Mr. Channell? 

A Correct. Through IBC, and that continued until — I 
think the last time was January of '87, I believe was the last 
payment, and those were consistently — you know — twenty, 
twenty . 

Q This agreement did, however, substitute for the 
original $20,000 per month agreement you had with IBC dating 



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MU-n nromma co.. mc. 
)07CStrett. NE 25 

Vuhiii|ton. D C. iOOOJ 
(20J) MlS-««< 



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back to December of '85? 

A I don't know if it superceded or was included. I 
don't ever remember that even being discussed. 

Q But you didn't expect to continue to receive 
$20,000 from IBC as a monthly retainer? 

A For— no, I was getting $20,000 a month from the 
Channell organization. 

Q From Mr. Channell, but originally, that was in 
addition to the $20,000 a month retainer that you were - 
splitting with Mr. Artiano? 

A Yes. I wasn't — you know — I wasn't getting from 
both sources. 

Q Wait a second. Now I'm confused. 

A In other words, are you saying did I get 20 from 
one and 20 from another? 

Q Let's go back to the pre- joint venture period, 
because I was under the impression that you were continuing 
to receive $20,000 from IBC, which you split 10 and 10 with 
Mr. Artiano, and, in addition to that, received an additional 
$20,000 per month. 

A No. I think if you'll see the — if the bank 
statements all — you know — there was $20,000 a month to 
Fischer, and that $20,000 was — for lack of a better word, 
I'll call it a pass-through. It was Channell organization to 
IBC, 20 to 20 to IBC, 20 right out IBC to David C. Fischer 



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and Associates . 



Q And that was in lieu of the original retainer that 
you had — the agreement that you had with Mr. Miller, original- 
ly, for $20,000 a month? 

A I don't know if I want to even call it in lieu of, 
because I've got to tell you, when that took place, that was 
the deal that was struck with Channell, and I don't know if 
it supplanted or what. I don't know how to answer this 
because it was not something that was discussed. Rich knew 
the negotiations were going on with Channell for that 
separate deal, and he said it was okay with him, and that's 
what we did, and that became, you know, the compensation. 

Q And then you did not receive additional compensation 
from IBC? 

A Not until after the agreement was signed, and we 
started doing other things, and other clients, and all along, 
the 20,000 continued from Channell. 

Q Was that the deal where Mr. Channell offered you, 
originally, a greater amount, $30,000 a month? 

A Channell originally offered me more than that. 
First it was forty, and, a lot of times these were informal 
discussions. After a meeting he'd say, look, you know, if 
you'd ever be interested we'd really like to have you come 
over here. I know you haven't decided on what you're going to 
do in the future, but we'd like to make you an offer and like 

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(202) V<6-66M 



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to have you come in an office with us. 

And at one time there was a more formal thing, 
where we sat down and actually cut the deal that I'm talking 
about, but it was after I had discussions with Rich to let 
him know what was going on, that there was an attempt to get 
me to disassociate from him and go to work for Channell. 
I'll just stop there. I'm rambling. 

Q I'm a little bit confused. Let me see if I can 
explain my confusion, and then you can help me. 

In January of '86, you and Mr. Artiano essentially 
concluded that you were working too hard for the money that 
you were being paid? 

A Well, I didn't say too hard. I just said the 
workload increased. 

Q Had increased beyond what you'd originally an- 
ticipated, and therefore you requested a $50,000 accelera- 
tion. Is that correct? 

A And there was a concern that maybe this was not 
going to be a real permanent client. I mean, based on 
experience primarily that he'd had in Washington. 

Q And in April, when a lot of these programs, as you 
said, were starting to really take off — SDI and that sort of 
thing — you again requested a $50,000 acceleration, in part 
because you needed to pay the note, but also, because the 



work had grown larger. 



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vn C Sirctt. N E 
WiAiatno. DC. 20002 
(202) V46-MM 



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A It was primarily because we had that large payment 
to make, and there was a cutoff of that permanent relationship 
with Huntsman at that time. So that was the reason for the 
acceleration, and I explained that to Rich. I said I've got 
this obligation to meet. 

Q All right. At or about that same time, you 
negotiated with Mr. Channell to substitute a direct agreement 
to him for the original agreement that you had with Mr. 
Miller for $20,000 a month? 

A No. This had nothing to do with the relationship 
with — Rich Miller made an agreement with Artiano and Fischer 
for a long-term relationship. 

Q Right. 

A That's one thing. The subsequent discussions with 
Channell didn't substitute, didn't take the place of. It was 
just discussion that Channell and I had, and that I kept 
Miller appraised of. 

Q Am I the only one that's confused in here, because 
here's what we've got in, say. May of '86. Let's take May of 
'86. 

Under your agreement with Miller, you're entitled to 
get $20,000 a month, which you split with Artiano 50/50? 

A Correct . 

Q All right. Now you have a separate agreement with 
Mr. Channell. Now either you are negotiating over that same 



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Wufaufioa. D C 20002 
(202) V«&-MM 



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§20,000 or you're getting an additional §20,000. And what I 
don't understand is whether you, in May of '86, expected to 
get §20,000 from Mr. Miller, and §20,000 from Mr. Channell 
through Mr. Miller, for a total of 40,000, or whether all you 
were looking to get through Mr. Miller was §20,0007 

A At that point, all I got from Miller was twenty a 
month, period. 

Q Right . 

A That's all that I received. 

Q And were you expecting the §20,000 you were getting 
from Mr. Channell to be in addition to that? 

A I'm really missing the boat here. It was Channell. 
At this point it was Channell 's money. 

MR. McGOUGH: Let's go off the record. 
[Discussion off the record] 

MR. McGOUGH; Let's go back on the record and see 
if we can reconstruct some of what was said. 
BY MR. McGOUGH: 

Q As Mr- Fryman pointed out, there was a period of 
time at the beginning of the relationship, when you and Mr. 
Artiano were collecting a total of §20,000 from IBC, and it 
was. split 10 and 10? 

A Correct . 

Q There then came a period of time, in April or May of 
19 86, when you entered into a side arrangement with Mr. 

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MUSI Roomwo CO., MC 
507 C Satn. N E. 2 5 

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Channell, and you began to receive $20,000 from IBC, which 
had as its source Mr. Channell. He would pay IBC twenty, and 
you would collect twenty? 

A Yes. 

Q Mr. Artiano, nevertheless, as you understood it, 
still collected his $10,000 from IBC? 

A Yes. 

Q And up until the time of the joint venture agree- 
ment, that was the state of your income stream, other than 
the two accelerations that we've discussed, your income 
stream from IBC? 

A I believe that's correct, yes. 

Q Okay. All right. I'm going to change the focus a 
little bit. 

A You know, I guess — is what you're asking here was 
Miller still paying on his — you know — honoring his obligation 
here, and then were we operating under the side thing at the 
same time and collecting from both? Is that what you're 
asking? \ 

Q Well, I was very confused. When you talked about 
making this separate deal with Mr. Channell, I initially 
inferred that you were doing that in addition to your 
original agreement with Mr. Miller. 

A I see. All right. 

Q And that you were collecting 20,000 from Miller, 



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■uoi i w u m wu CO.. MC 

)07CSn«ti. NE 25 

VuhufiDii. DC. 2000: 
(202) M«-M<« 



UNCUSSIFIED 



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plus 20,000 from Channell, through Miller, for a total of 
$40,000, of which 10,000 went to Mr. Artiano. As I under- 
stand it now, that was my mistake. 

What you were really saying was that you were 
collecting a total of $20,000 from IBC in this, after you — 

A That was paid for by Channell. 

Q That was paid for by Channell. And that Mr. 
Artiano then had a separate deal with Mr. Miller to collect 
his ten, or something. 

MR. McGOUGH: Let me go off the record for one 
second. 

[Discussion off the record] 

MR. McGOUGH: Back on the record. 

BY MR. McGOUGH: 

Q During the period of time since you left the White 
House, did you make any payments of money, or gifts, or other 
things of value — and let's put a value of, say, over $100 — to 
any of these people. I mean, I'll give you just a list of 
paople. 

A Since leaving the White House? 

Q Since leaving the White House. 

A Okay. 

Q Elliott Abrams? 

A No. 

Q Attorney General Meese? 



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wuin MMwrata co., mc 

507 C SiretT. N E 2 5 

Wuhinfioii. DC 20002 
(n)2) M6-M66 



UNCLASSIFIED 



130 



A No. 

Q Charles wick? 

A No. 

Q William Casey? 

A No. 

Q Frank Fahrenkopf? 

A No. 

Q Oliver North? 

A No. 

Q Donald Regan? 

A No. 

Q To your knowledge, were any payments made, or 

gifts, again of that value, made to any of those people on 
your behalf? 

A No, not to my knowledge, at all. 

Q Do you know Ron Paccini? 

A Yes. 

Q And who's he? 

A He's a boyhood friend of Artiano. They grew up 

together in New York. 

Q How long have you known him? 

A I met him probably in 1986. I don't think before 

that I may have. He stayed at Marty's house, occasionally. 

Q On how manyy occasions have you seen him? 



Have I been with him? 



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^fioussiFm 



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Yes. 



A Half a dozen times; maybe a dozen. And sometimes 
being with him, maybe he was staying at the house when I was 
there, or I would come by and he was there, and we would say 
hello and that was about it. So, let me put it up to a dozen 
possible encounters, all the way from bumping into him to 
having dinner with him. 

Q Did you ever have any kind of professional or 
financial dealings with Ron Paccini? 

A Yes. 

Q And on what basis? 

A A client. A client that was with Artiano, two guys 
in the law firm, and Paccini. 

Q And what were those dealings? 

A It was a business client. It had no dealings with 
the Government. It was strictly a business — it was a 
business client- 

Q And what was the — 

A And I'd be more than happy to tell you. It's just 
that I don't think I have to talk about personal clients, 
but — 

Q Well, let's see how far we have to go to describe 
the contours of what we're talking about. 

A But let me describe the client. It's the kind of 
client who dealt in — it was a client that dealt in goods, and 



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IMXOI HOOMTMO CO., MC. 
J07 C Sotn. N E. 2 5 

Vaduactoo. DC 20002 
(202) )4«466i 



«NCUSSIFIED 



132 



they had some needs to meet people in related businesses, if 
this makes — anyway, it was a straight business deal, and it 
was non-related to public relations, it was non-related to, 
or had nothing to do with the Federal Government. 

[Recess and brief discussion off the record] 
MR. McGOUGH: Back on the record. 
BY MR. McGOUGH: 

Q Mr. Fischer, we've been discussing a business deal 
in which you participated with Mr. Paccini, some time — I 
believe you said in 1986, is that right? 

A I believe it was '86, yes. 

Q What we'd like are some of the details of that 
deal, particularly who the client was, who the partners in the 
deal were, what the purpose of the deal, or what you were 
trying to accomplish, and your estimate as to the amount of 
money that changed hands as a result of that. 

A Okay. The client was a company called C.O.M.B. 
And it's all capital letters. C, period, 0, period, M, 
paxiod, B, period. I don't know what it stands for. 

I believe the client was referred to this group, or 
introduced by Ron Paccini, who discussed it with Marty. It 
led to a meeting with the client in the law firm. At that 
meeting were at least Artiano and I, and probably at least 
one other person from the law firm. I just can't recall. 

But the participants, you know, the team that was 



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■mi ■ Mu wiwu co„ MC 
yn c scnw. N.E. 2 5 

VHtuoftM. D C 20002 
(202) M«-«6M 



WNCUSS/f/EO 



133 



assembled to handle this client, and who participated, 
financially — Fischer, Paccini, Artiano, Steve Hauheim, Bob 
Davis . 

Q And the purpose of the arrangement, or your 
services was, in general terms, what? 

A The client was specifically looking for assistance 
in obtaining liaison contacts with U.S. corporations, and 
actually, I believe, maybe even some foreign, in order to 
purchase consumer goods . 

Q Did the proposed services have anything to do with 
the United States Government? 

A Not at all. 

Q Did they involve any of your prior contacts at the 
White House? 

A I don't believe I contacted anybody at the White 
House for any of this . 

Q How about any former employees of the White House? 

A I don't believe so. 

Q And to the best of your recollection what — 

A Now wait a minute. I just thought of — Muffy 
Brandon who ended up running Rogers and Cowan — I think was 
the public relations firm. Muffy Brandon used to be the 
social secretary at the White House and I did have a couple 
of conversations with her about C.O.M.B., and it had to do 
with one of the companies, and I don't know why I thought to 



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)07 C Sam. N.E 
Vishinfmo. DC. 20002 
(20:) VW-MM 



call her, but she did assist with — Muffy was running Rogers 
and Cowan at the time. I believe that's the only person — 

Q Rogers and Cowan is what? 

A A public relations firm based out of Los Angeles. 
And I believe that was the only person, a former associate, 
that I ever contacted. 

Q Now can you give us your estimate as to what the 
total amount of the fees received were? 

A I believe the retainer was 10,000 a month fora 
period of three months to maybe six months, but no longer 
than six months. 

Q And was that divided among the participants that you 
described? 

A It was divided among the participants, yes. 

Q Mr. Fischer, at what banks do you maintain accounts? 

A You're asking the wrong person here. 

Q Savings or checking. 

A My wife does that. Right, at present? 

Q At present. 

A I think everything is United Virginia Bank. 

Q Do you have any accounts at any banks in the 
District of Colximbia area, other than that? 

A No, none. 

Q When you were in Utah, with whom did you bank? 

A Let's see. There was a local bank in Farmington, 



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•Mum rtKmma co.. mc 

!07 C Simt. N E 2 5 

Vuhiniicfi. c jooo: 
(202) )4«-<M6 



UNCLASSIFIED 



135 



Davis County Bank, and a big chain in the West. Let me think 
for a second. First Interstate Bank. 

Q Other than United Virginia, Davis County, and First 
Interstate, in the past four years, have you held accounts to 
the best of your recollection, deposit accounts — 

A Best of my recollection were only those two banks 
in Utah, and the ones we just opened this year in Virginia 
with the United — I think it's called United Virginia Bank. 

Q We received from your attorney by letter dated 
August 4th, copies of your check registers, and I'm not going 
to go through them. Mr. Fryman and Mr. Oliver may want to 
ask you some more questions . 

I only had one question and that related to a check 
to First Interstate Bank for $20,000, Check Number 597, and 
it's undated in the check register. 

Can you tell me what that — 

A Do you know what the date is on this? 

Q No, it's not reflected in the check register. 

A I'd have to ask my wife, but I have a feeling 
that's that payment I was telling you about. 

Q When you say the "payment you were telling us 
about," you mean the one that sparked your request for an 
acceleration of your fee? 

A Yes. Again, I could ask my wife and she would 
probably know the answer to that, but I believe that's what 



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507 C Street, N E 25 

Wuhingitui. D C 10002 
(202) M6'6«66 



UNCLASSIFIED 



136 



it was . 

Q Mr. Fischer, have you been immunized by the 
Independent Counsel? 
A Yes. 
Q And what kind of immunity have you been granted? 

MR. McGOUGH: Maybe that's better addressed to you. 
I was just interested in his actual status vis-a-vis the IC. 

MR. WORK: Well, you can probably tell me better 
than I can tell you, what kind of immunity we have. We- have 
something I think they call down there desk immunity. 

MR. McGOUGH: Can you be a little more specific. 

MR. WORK: I can. I'll show you the letter. Do 
you want to see it? 

MR. McGOUGH: Yes, if you have it. 

[Discussion off the record] 

MR. McGOUGH: After discussion of the record, 
counsel for Mr. Fischer has agreed to check with the Indepen- 
dent Counsel, and if they have no objection, providing a copy 
to both the House and the Senate Committee of the letter 
granting immunity, or describing whatever it is that they did. 

The record can reflect here, I think, that Mr. 
Fischer is testifying without immunity from either Committee, 
having not requested any immunity prior to testifying here 
today . 

MR. BENSON: Tom, may I interject, just make a 



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)07 C Sum. N E 2 5 

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(202) iA6-66U 



UNCLASSIFIED 



137 



comment here. I think that inasmuch as we've raised the 
issue of immunity, this record ought to be clear that Mr. 
Fischer didn't seek immunity from the Independent Counsel. 
It was offered to him, and through advice of counsel, he 
accepted the offer. 

MR. McGOUGH: No objection to that being reflected. 
MR. WORK: I have no objection. I think what was 
put on there is just fine. 

MR. McGOUGH: All right. 

MR. WORK: Now I might add, and I think it's 
important, that it was a difficult decision for Mr. Fischer 
to accept it because of some of the negative connotation that 
sometimes goes along with accepting immunity, and finally, he 
did decide to go forward. The description of that decision- 
making process was more adequately set forth in Phil Sheehan's 
"New York Times" article not too long ago. 
BY MR. McGOUGH: 

Q Finally, Mr. Fischer, just to return to something we 
talked about very early, there was one episode that your 
counsel alluded to, where you felt you may have received 
legal advice from Mr. Fischer or his firm. 

A You mean Artiano. 

Q Mr. Artiano or his firm. Excuse me. 

A Yes. 

Q And I believe counsel said that you didn't feel 



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507 C Strttt. N E 25 

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(202) V««-66M 



UNCLASSIFIED 



138 



that it was necessary to invoke privilege on that. Have we 
discussed it already? Has it been one of the items we've 
brought up already? 

Do you have.' any objection to telling us — 

MR. WORK: I will just tell you, he did discuss 

with him, although there was no formal rendering of legal 

O 
advice. Further, the advice that he rece^ived from the White 

House Counsel's Office when he left, about whether or not any 

revolving door prohibitions applied to him about doing any of 

this work, and Artiano's firm advised him that the White 

House Counsel was right, and the revolving-door provisions do 

apply to him. 

MR. McGOUGH: Is that a correct statement? 

THE WITNESS: Correct. Yes. That's correct. 

MR. McGOUGH: That's all I have, and I'll turn the 

floor over to Tom Fryman. 

EXAMINATION BY COUNSEL FOR THE 

HOUSE SELECT COMMITTEE 

BY MR. FRYMAN: 

Q Mr. Fischer, I want to return, for a few minutes, 

to the original understanding that you and Mr. Artiano 

reached with Rich Miller and IBC, which I believe you said 

was reached in December of 1985. Is that correct? 

A I believe that's correct, yes. 

Q And at that point, there was no written understand- 



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)07 C Sotn. N E. 25 

Wa^tuofmo. D C iOODl 



UNCLASSIFBED 



139 



ing. This was an oral understanding? 

A Correct. 

Q And the understanding provided for payment of a 
monthly retainer of $20,000, is that correct? 

A Yes . 

Q And that was to be divided between you and Mr. 
Artiano, equally, is that correct? 

A Yes. 

Q And that was to run for a period of two years-, is 
that correct? 

A Yes . 

Q So the period of the understanding would extend 
from December of 1985 through November of 1987, is that 
correct? 

A Yes. 

Q Now you also testified that beginning as early as 
January or February of 1986, it developed that you were 
devoting much more time to this arrangement with IBC than you 
h«d anticipated when you had entered into this understanding 
in December, is that correct? 

A Yes. 

Q And as a result of this additional time commitment, 
Mr. Artiano asked that there be an acceleration of payments 
under the agreement, is that correct? 



Correct. 



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507 C Sottt. N E. 25 

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(202) Hi^MM 



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Q Now was your understanding of the acceleration, 
that that meant, or that the time for completion of your 
services under this understanding, would end prior to November 
1987? 

A I don't believe that was ever discussed. 

Q Well, what did you understanding? If you're 
devoting more time than you had expected to devote, and if the 
payments were being accelerated, didn't that mean that your 
services would end earlier? Otherwise, what is the purpose 
of the acceleration? 

A I'll be very honest with you. I don't believe that 
was ever discussed. You know, we were basically, you know, 
going month to month with this relationship, until I formal- 
ized an agreement with IBC, that then became a formal 
document, and ended up with an office, and all of the things 
that — you know — the things that you do to go into business 
with somebody. 

Q Well, as of January or February 1986, at least one 
month's retainer at the end of the contract had in effect 
been paid to you. Now did you expect to be working in 
November of 1987 for no payment? 

A I don't believe that was ever discussed. I don't 
believe I ever thought about it. I just — you know — as I've 
said before, very early on we started talking about the 
possibility of forming a permanent relationship, and that's 



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eventually what happened, and beyond that — I don't know how 
else to answer that question. 

Q The monthly payments under the understanding were 
$20,000 you've testified? 

A Correct. 

Q Now the accelerated payment in early 1986 was 
$50,000, is that correct? 

A Correct, and split. 

Q Now' is there any reason that the accelerated 
payment was not a multiple of $20,000, i.e., that it was 
40,000 or $60,000? 

A No. I don't know how that was arrived at. I know 
what Mary asked for, and that's what was paid. 

Q You had other discussions yourself, you've tes- 
tified, in April, about an acceleration just to you? 

A Correct . 

Q And that was an acceleration of $50,000? 

A Correct . 

Q Now was it your understanding that that was five 
payments of your $10,000 a month, which was your half of the 
agreement? 

A Yes. It was an acceleration of the monies that 
were coming to me. Yes. 

Q And Mr. Artiano would continue to receive his half 
of the payment at the times the services were to be performed? 

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MLLW MvoirnMO co. 


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A Or if he--you know — he may have asked for accelera- 
tion. I don't know exactly how he handled his relationship 
but he was going to continue to receive his money. 

Q So under that acceleration, at the time you 
discussed it with Mr. Miller, you were expecting to continue 
to perform services until November of 19877 

A Again, I don't ever remember talking about that. 
Eventually, we formalized the relationship. Now what happened 
when I asked for the acceleration — did we ever sit down- and 
say now you understand that we have to go until November of 
'87? I don't believe that ever happened. 

Q Well, you have used the phrase "acceleration" and 
that's what I'm trying to understand. I mean, were you 
really talking about acceleration of payments, but that you 
would continue to perform services for the setme period of 
time, covered under the original understanding, with the 
effect that for a period of 5 ob6, or 7 months, at the end of 
that period, you would not receive any payments because you'd 
already been given accelerated payments? 

Was that your understanding by an acceleration? 

A That I continue to work for nothing? 

Q Yes, because you'd already been paid the money, and 
at the time you were then to perform the services in 1987, you 
would not be receiving any monthly payments as you performed 



the services? 



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A I don't know that that is how I would characterize 
it, because, again, all of the discussions were going on at 
the time about forming a permanent relationship with IBC in 
which we would have a specific financial arrangement on new 
clients . 

At the same time, I was talking to Channell about a 
separate arrangement. So I don't think that ever even 
entered my mind. I mean, the thing was changing so much all 
of the time. You know, what turned — you know — what started 
out, it was A, evolved into B, into C, into D. 

Q So at the time you and Mr. Artiano were talking with 
Mr. Miller about acceleration of payments, you did not 
contemplate performing services at the latter period of the 
understanding without receiving monthly payments? 

A You're going to have to phrase that. I'm lost 
right now. 

Q At the time that you and Mr. Artiano talked to Mr. 
Miller about accelerating payments under this 2-year agree- 
mant, so that you received more per month than your $10,000 
contemplated under the understanding, it was not your 
expectation that toward the latter part of the period covered 
by the understanding, i.e., late 1987, you would continue to 
perform services without receiving a monthly check from IBC? 

A At the time of the discussions on acceleration, I 
think I envisioned a permanent relationship with IBC that 



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would involve a lot of different clients and a lot of 
different activities. And so I wouldn't have — this was never 
discussed, but I would not be working for no compensation. 
We would be working on different client matters at that time. 

At that time I would be operating as a partner of 
sorts, in an association with IBC. 

Q So while you've used the word "acceleration" of 
payments under this understanding, you were really not 
talking about an acceleration, were you? 

A I think we were talking about an acceleration, yes. 

Q Well, you've just said — let me withdraw that. 

A In other words, an obligation, you know, was made 
for a 2 -year period, and, you know, that was the inducement 
to come on board with IBC, to the exclusion of other people 
who were talking to me. And that was the commitment that was 
made. 

And then, very quickly, negotiations and discussions 
were Ijeing held to form a permanent relationship that in fact 
did take place, and terms of which were very favorable to me, 
and guaranteed an income stream for as long as we maintained 
our association. 

So, you know, there were a couple of things going 
on at one time. There was not just this — you know — initially, 
that's what was agreed to, with the expectation of, who knows 



whether this is going to go on? 



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And that was always the fear. That was Marty's 
fear, particularly, and, you know, after I learned a little 
bit more about how Washington works, and how clients can 
become fickle, and with you today and not with you tomorrow, 
there was that reasoning given for that initial advancement, 
or acceleration. And then the one I personally made, for a 
more personal reason, in April. 

So, you know, that's what was going on in our minds 
at the time, and why those were asked for. 

Q Well, Mr. Fischer, if you were not expecting to 
perform services for the full two years, as you had agreed to 
in December of 1985, how can you characterize the payments in 
January and April as accelerations of amounts due to you 
under that agreement? 

A Because we didn't know exactly what the future was 
going to hold. I mean it was anticipated when we had the 
discussions that it was going to be a long-term relationship, 
because that's what was asked for and that's what was agreed 
to. 

And as I said, and ongoing with that very soon 
became discussions about a permanent relationship, and I 
don't know how else to answer this. 

Q Well, the 2-year relationship that you negotiated in 
December was a long-term relationship, was it not? 

A Correct. That Marty negotiated, and I agreed to. 



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Yes, it was a long-term conunitment. 

Q I mean, that was one of your original objectives, 
that you discussed with him? 

A Yes. That I didn't want to take on this client, 
IBC, to the exclusion of other companies that wanted to talk 
to me, without some guarantee — in other words, you don't shut 
other things down without a more permanent relationship, and 
that's what I told Marty that I wanted, and that's what he 
went after. 

Q And then you very suddenly found that you were 
spending more time on this client than you had expected, in 
December of 1985? 

A Correct . 

Q So you asked for additional money? 

A We asked for an acceleration, yes. 

Q But my question is directed to whether it was 
really an acceleration, or whether it was a renegotiation of 
the monthly amount that you were being paid for the additional 
tiae that you were putting in? 

A I can only tell you that when discussions were had, 
the few times I talked to Rich about acceleration, it was 
always in terms of acceleration, and that was fine with him. 
He didn't care when the money was paid. 

Q All right. But it was not your expectation that 
you would work any period at the end of the contract where 

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you did not continue to receive a monthly payment from IBC7 

A Like I said, what I anticipated out of this 
relationship was something that became permanent, and it did 
become permanent, and in that was a complete formula, as you 
have seen, that describes how that new entity was going to 
operate financially, and what the splits were among the 
principals. 

And so, you know, what I envisioned came true. We 
ended up forming something that was permanent, and that, came 
about in July. 

Q But that had not been agreed upon in January or 
February? 

A No, it had not. No, it had not. It was being 
discussed right from the beginning, but had never been 
formalized. 

Q But in January or February you got the extra 
$25,000, is that correct? 

A Correct. 

Q And there 'd been no new agreement reached at that 
point? 

A No . No new agreement . 

Q And at the time that got the extra $25,000, it was 
not your expectation that you were going to continue to 
perform services in October and November in 1987, without 
getting your monthly check from IBC? 

UMCUSSIFOFn 



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KR. WORK: He's answered that several different 
times . 

THE WITNESS: I feel like I'm beating a dead horse 
here. I never thought about, you know, November of '87, or 
sat down and said, well, if we do this, that means I've got to 
work this many months without any income. That was never 
discussed. I don't think I ever thought about it. 

I knew that we were heading very quickly towards a 
permanent relationship that would almost be a partnership, and 
that IBC was going to be my home. 
BY MR. FRYMAN: 

Q Who came up with the word "acceleration"? Was that 
your word or was that Artiano's word? 

A I have no idea. I just know that it was a word 
that was used. 

Q Well, do you know if you came up with it? 

A I don't know that I did, or Marty did. 

Q So far as your recollection is concerned, you may 
have come up with the word? 

A I may have come up with it, yes. 

Q All right. 

A You know, I just — I mean, I don't know. That's a 
pretty common word, acceleration. 

MR. FRYMAN: I ask the reporter to mark as Fischer 
Deposition Exhibit 9 for identification, a copy of the 



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(202) Vt«-MM 



UNCLASSIFIED 



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Subpoena Duces Tecum dated June 18, 1987, directed to Mr. 
Fischer. 

[A document was marked for identifi- 
cation as Fischer Deposition Exhibit 
No. 9] 
BY MR. FRYMAN; 
Q Mr. Fischer, I show you Exhibit 9, and would you 
examine that, and confirm that that is the subpoena that was 
served on you, or your counsel, or a copy of the subpoena. 
A That looks right. 

Q Now Mr. Work and Mr. Fischer, under this subpoena, 
certain documents are called for in the attached schedule. 
Passing subparagraph a. and b. for the moment, and focusing 
on subparagraph c.,d., and e., have all of the documents 
called for in those subparagraphs been produced? 

MR. WORK: Yes. They have. Those were the 
documents you received last Friday. 

MR. FRYMAN: With your letter dated August 7th. 
MR. WORK: Right. 
BY MR. FRYMAN: 
Q Now directing your attention to subparagraph b., 
what tax returns have been produced? 

A 1985, Federal and state, and there's nothing in '86 
because they haven't been filed yet. Everything for '85 was 
provided, and, yeah, nothing for 1986. 



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Q And you've received an extension of time to file 
your 1986? 

A Yes. They were waiting for some documents on a tax 
matter that never arrived. 

Q Now directing your attention to subparagraph a., 
that is the subparagraph that calls for bank records, and Mr. 
Work, you and I have discussed production of materials under 
that subparagraph. 

You were requested in the first instance to provide 
bank statements for all of the accounts over which you had 
any authority to withdraw funds during the period beginning 
July 1, 1985 to the present. 

Bank statements have been transmitted to me by Mr. 
Work, by a letter dated July 7, 1987, and I just want to 
review these accounts with you, to just confirm on the record 
that these are all the accounts. 

A First of all, let me tell you how our banking is 
done. My wife — 

MR. WORK: Let's speed this up. Let's let him ask 
the questions . 

THE WITNESS: Okay. Well, that's why I may not 
know everything about those accounts. 

MR. WORK: We have already heard that. 
BY MR. FRYMAN: 
Q In this letter there is an account of David C. 



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Fischer and Associates at the First Interstate Bank of Utah, 
Account ^^^^^^^^^H ident i f ied . 

A Yes . 

Q That's the first account. 

A Yes. 

Q There's a second account of you and your wife at 
the Davis County Bank, which is Account^^^^^^^^^^^BThere 
is a third account at the Davis County Bank. That's Account. 



Now are those all of the accounts that you had any 
control over during this period of time, prior to the opening 
of the accounts at the United Virginia Bank? 

A Yes. I believe that's correct. 

Q And I think you earlier answered, in response to 
Mr. McGough's question, that you did not have any account in 
the District of Columbia during that period of time? 

A No. No accounts in D.C. at all. 

Q Now is it correct, that after you moved to this 
area, you opened accounts at the United Virginia Bank? 

A Correct. 

Q And in Mr. Work's letter, there are four accounts 
listed at that bank. Is that your understanding, that you 
have four accounts? 

A You know, I'll have to be honest. If he's got it 
down there, we do. 



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NC. 

25 


507 C Sotti N E 




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iOOO 




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Q Let me just read for the record the numbers 
A Okay; ■ 

Account^^^^^^^^^^^^^^^^^^^^^^ AccountI 

Account^^^^^^^^^^^^^BNow are those four 
accounts the remaining accounts that you have had any 
signatory control over during the period of time called for in 
the subpoena? 

A Yes. I can't tell you what those accounts are, 
but — 

MR. WORK; Let me just put on the record what he 
said before. His wife manages all these accounts to a much 
greater degree than he does. So I would have to say that I 
had to get all of this information from his wife as to what 
these accounts were, and what was-- 

THE WITNESS: She works with the accountant. 

MR. WORK: And how they were run. So — 

THE WITNESS: But I believe that's right. We do 
not deal with any other bank, other than that bank. 

MR. FRYMAN: All right. 

THE WITNESS: And all our Utah accounts are closed. 

BY MR- FRYMAN: 
Q Now prior to the deposition today, Mr. Fischer, I 
spoke with Mr. Work, and indicated that our accountants have 
reviewed the materials that you have, and in order to clarify 
our understanding of these materials, we have a number of 



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questions about specific deposits or specific withdrawals. 

I think a more efficient way to proceed, rather 
than to direct these questions to you orally today, without 
your possibly being familiar with all the documents, would be 
for me to send a letter, or letters, to Mr. Work, setting 
forth these questions and possibly calling for additional 
documentation under subparagraph a. of the subpoena. 

It is my hope and expectation, that through an 
exchange of correspondence we can resolve all of these 
questions. In the event that there remain any ambiguities, I 
would reserve the right to reconvene the deposition, and in 
my discussion prior to commencement today, Mr. Work indicated 
that that arrangement was satisfactory to him, and to you. 

Is that correct? 
A Yes. That's correct. 

[Pause] 

MR. FRYMAN: I also indicated to Mr. Work, prior to 
the deposition, that the materials that accompanied his 
letter dated August 7 were not actually physically received by 
me until this morning, and I'm not saying that's Mr. Work's 
fault. It's just a matter of, within our office, I did not 
get them until this morning. 

We have reviewed the materials during the morning, 
and I do not believe we will have any additional questions 
concerning those materials. 



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However, because of the short period of time that 
we have had to review them, I would also reserve the right, 
in case we have additional questions, to pursue them at a 
later time. 

MR. WORK: That's satisfactory to us. 
MR. FRYMAN: With those understandings, I have no 
further questions at this time. 

EXAMINATION BY COUNSEL FOR 
THE HOUSE SELECT COMMITTEE 
BY MR. OLIVER: 
Q Mr. Fischer, you indicated earlier, that your first 
knowledge of Oliver North occurred when it was necessary for 
you to identify people who were going into meetings with the 
President. 

A Yes. 

Q When did you come to know Oliver North on a 
different basis? 

A On a more first-name basis? About the time of this 
briefing, of the January 30th briefing. 
Q January 30th, 1986? 
A Correct . 

Q Had you had any direct contact with him prior to 
that? 

A No. I don't believe I ever did. The first time 
that I ever met with North, outside of my White House 



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employment, was in conjunction with the January 30th briefing. 
That would be the first time. 

Q In conjunction with the January 30th briefing? 

Yes, or the request for the January 30th briefing. 
When would that have been? 
I've got to say probably January of '86. 
Did you meet with him? 
Yes. 

Where did that meeting take place? 
EOB, in his office. Executive Office Building at 
the White House. 

Q Do you remember when that — 

It's in the calendar. Early January. 
In your calendar? 
Yes. 

Do you remember talking to him on the phone in 
early January about Spitz Channell? 

A There may have been a phone conversation but I 
really — the only record I have is of meeting with him in his 
office, and then meetings following that, the Public Liaison 
office, about the January 30th briefing. 

Q That's what you referred to in your earlier 
memorandum about having talked to McFarlane and North, and-- 

A The January 5th memo says that I met with — or 
conversations with Abrams, North, and McFarlane. I have a 



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feeling that what happened is that Artiano may have talked to 
Elliott Abrams, because I really think the first time I 
talked to Elliott Abrams is when we had the lunch. 

McFarlane, I remember, because it was in Utah, and 
he was out on a ski vacation, and we talked about this, among 
a lot of other subjects. And North, I don't remember the 
specific time, but I did meet with him about the briefing. 

Q But if it was in your January 5th memo, would not it 
have had to have been before January 5th? 

A I would assume that it could have been late 
December. I just don't recall. 

Q Were you in Washington in late December? 

A Early part of December, middle, and late, I think. 
I don't have an '85 calendar, but I was in town in '85, 
December of '85. 

Q You said earlier that you joined Huntsman Chemical, 
I believe, in April of 1985, as a vice president? 

A Correct. Yes. 

Q And you were in charge of public affairs, and, 
later — 

A Employee relations, and unions, and so forth. 

Q And what caused you to want to leave that employment 
after such a short period of time? 

A Let me — and I'll do this briefly. When I left the 
White House, I didn't do what everyone else does, and that's 



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talk to executive search firms, and interview with ten 
companies. My wife had been--ever since we've been married, 
we've been with Reagan, and our lives centered completely 




While all this was going on, John Huntsman, who is 
a very prominent individual from Utah, a very active Republi- 
can who served in the Nixon Administration, his son was at the 
White House in the Advance Office, and he and I had become 
friends. As a result of that, I met his father. His father 
was in Washington at the time serving as what they call a 
mission president, supervising the Mormon missionary effort in 
the Washington, D.C. area. 

Q I'm not really interested in all of Mr. Huntsman's 
background. I don't object to your putting it on the record, 
but — 

A But anyway, he and I got to become friends while he 
was here, and he just said, when you leave the White House I 
want to talk to you first. I had a conversation with him, he 
made an offer and I accepted it. That was the only person I 
talked to about employment, and I wanted to get back to Utah. 



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Huntsman provided the vehicle. 

And then to answer your question about why did I 
leave. ^^^^^^^^^^^^ 

was very anxious to get back into 
politics again, and in Washington activities. 

Q Let me get this straight. You went to Utah because 



A Right. And that was the employment 

opportunity that allowed us to do it. 

Q I see. 

A And so we went there. And also because I wanted 
out of Washington. I had suffered what we all do in govern- 
ment, burnout. So I went out there, and then, very soon, 
within a short period of time, realized I wanted to come back 
to Washington, and so started exploring opportunities to come 

back. ^^^^^^^^^^^^^^K^^t^^^^^^^^^^^^^^^^^^^^M^^ 
probably would come back to Washington. 
Q And when did| 

In July of last year. 

July of 1986? 

1986. Yes. 

What caused you to come back in December of '85/ 

What caused me to come back? 

To Washington. 



I made frequent trips back to Washington. 

ED 



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Q On behalf of Huntsman? 

A On behalf of Huntsman, and on behalf of — the 
President had put me on a commission, and I came back on 
commission work. 

Q Which commission was that? 

A International Boundary Commission. 

Q Did that require that you be confirmed by the 
Senate? 

A No. 

Q Were you compensated for that? 

A It has a compensation pegged at about a GS-15, I 
think. When the commissioner before me took the full 
compensation, and what I decided to do was take compensation 
as I worked, and so, I think over the two-year period — I'd 
been in for almost two years, and I think the allocation for 
that position has been about 125,000, of which I've turned 
back to the Government 105,000 in two years. 

Q You actually received the money and written checks 
back to the U.S. Treasury? 

A Well, no, what I have to do is every year I have to 
write to the Comptroller of the State Department, and say in 
this fiscal year I have turned down this much money and I 
have to turn it back into our budget. And what I do is, I 
write a letter saying this is not to be used for other IBC 
business. It's to be for Boundary Commission business. It's 

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to be turned back to the general revenue . 

So it's up to me how I handle. I chose not to take 
the money. And so there were occasions when I was back 
either on Huntsman business, or I'd be back on Boundary 
Commission business. ^, . 

Q What was Huntsman's business, that you did for them 
in Washington? 

A Huntsman — oh, back in Washington? 

Q Yes. 

A Some political work. John keeps his fingers very 
actively in politics, keeping his contacts open. 

Q Is that what you were paid to do? 

A Was I paid to do? 

Q Yes. 

A No. My job was senior vice president in charge of 
public relations, public affairs, and for that it was keeping 
the Huntsman Chemical name, you know, in the forefront, 
promoting the company, promoting John personally, but a lot 
of it had to do with employee relations. 

Q Did they have any interest in Washington, government 
contracts, legislation that affected the company in any way? 

A He did have — he had one matter before the Justice 
Department, and it had to do with an acquisition or a merger 
that he was going through. 

And I was asked by other senior officers if there 



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was anything I could do to assist in expediting the matter 
before the Justice Department, and I said that it would be 
improper and that that thing had to fly on its own merit, 
that the merger would either be approved or not approved. 
Huntsman didn't make the request. Other people made the 
request if I could help. And I refused and did not do it. 
And the merger went through anyway. 

And that was the only contact with the Federal 
Government that I was ever aware of with Huntsman Chemical . 

Q So your trips back to Washington on behalf of 
Huntsman had nothing to do with legislation or the Executive 
Branch of Government? 

A No, sir. 

Q It was strictly political? 

A Political and, in some, for John personally. I 
mean, you know, John, as I said before, was part of the Nixon 
Administration, had been very active in the Reagan ceunpalgns, 
served as a Financial Chairman and State Chairman and so 
forth. And a lot of it was just keeping his name in the 
forefront. You know, he would be back here for meetings of 
Chamber of Commerce or whatever, and I'd be back here about 
the same time. 

Q On these trips, were your expenses back and forth 
to Washington, your air fare and so on, paid for by Huntsman? 

A Some of them were, yes. 



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Q Were some of them paid for by someone else? 

A Some of them were paid for by the Boundary Commis- 
sion. 

Q By the Boundary Commission? 

A Yes, sir. 

Q How many trips between April of 1985 and December 
of 1985 did you make to Washington? 

A April of '85 — 

Q When you moved to Utah, when you took this job. 
And then you came back. 

A From April to when? 

Q Till December of 1985, the balance of 1985. 

A I can't estimate. Maybe on the average of once a 
month, I would say would be my best guess right now. 
Probably once a month. 

Q But they were strictly for political and public 
relations or for the Boundary Commission? 

A Yes . 

Q How many trips did you make for the Boundary 
Commission? Did you attend the actual meetings of the 
Boundary Commission? 

A Yes. 

Q When do they meet, four times a year? 

A No. The Boundary -- there's a couple of Boundary 
Commissions. This one meets really when the Commissioners 



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want. We generally meet at least twice a year. And then 
there's a staff here in Washington and there's a staff in 
Canada . 

So I would come back and meet with my staff. But, 
as far as official meetings with my counterparts in Canada, 
it was generally in the spring and the fall. 

Q You were receiving full-time compensation from the 
Huntsman Chemical Company from April 1985 until when? 

A April of '86. 

Q April of '86. You were a full-time Vice President? 

A Yes, sir. 

Q When did you receive permission to receive outside 
income as a consultant? Did you receive permission? Did Mr. 
Huntsman know — 

A Yes. 

Q When did — 

A Right from the beginning of the relationship, it 
was understood. 

Q Did you have any other consulting income prior to 
the income you had from IBC, other than the Boundary Commis- 
sion, any particular income? 

A Other than the IBC and that relationship, I think 
that was all. There may have been a few things that Marty 
and I worked on in December of '85, but I don't know. 

It was about December of '85 that it was agreed 

UNCLASSIFIfn 



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that we were going to go consulting; that Huntsman and I had 
a discussion in which we got basically four months here to 
put your business there, and then we are going to go consult- 
ing. 

So, you know, there may have been something in '85, 
another thing. But my relationship with IBC started, I 
believe, in '85, December of '85, and that was the first 
check from that. 

There may have even been another client matter with 
Artiano unrelated to this. I just can't — 

Q But you can't remember. You had this agreement 
with Huntsman right from the beginning that you could do 
consulting? 

A Yes. 

Q But you can't remember whether or not you did any 
during that period of time? 

A I don't think there was any consulting. 

Q So the first then would have been IBC? 

A I believe that's correct, yes. 

Q When did Marty Artiano suggest to you that you 
might want to consider consulting with IBC? 

A I believe it was December of 1985. That's my best 
recollection. It could have been earlier, but I don't think 
so. I believe it was December of '85. 

Q Was it in a meeting or a phone call? 



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A It could have been either one. Marty and I, you 
know, we have been constant contact, even when I was in the 
White House. 

I mean there's so many conversations, it's hard to, 
you know — he's not a guy that I heard from once a year. We 
talked all the time. 

Q Was there a conversation in November of 1985 
between you and Mr. Artiano in which he discussed this matter 
and suggested you come back to Washington, or when you were 
in Washington that you meet with Rich Miller? 

A In '85, in November? 

Q November of '85. 

A I believe it was December. It may have been 
November, but I believe it was December. I just don't have 
the time frame. 

Q The phone call? 

A Phone call, or it could have been a meeting. 

Q When you came back to Washington in December of 
1985, it was the beginning of December, is that correct? 

A It could have been the beginning, it could have 
been the middle. I was definitely here in December of '85. 

Q Do you keep a calendar? 

A I do. I have the complete '86 calendar. I don't 
have the '85. And the '86 you have. 

Q What happened to your 1985 calendar? 

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A Probably in the moving it got lost. I just don't 
have it . 

Q And when did you move? 

A March of this year. 

Q March of this year. Do you remember a meeting on 
December the 5th, 1985, at which you, Marty Artiano, Rich 
Miller, Frank Gomez, Spitz Channell and Dan Conrad were 
present? 

A I don't have a specific recollection of that, no. 
But, you know, I've already acknowledged I met with all of 
those people on frequent occasions. 

Q Do you remember meeting with those people together 
in early December of 1985? 

A Sometime in December of 1985. That's probably when 
we got together. I mean it certainly happened before I went 
to see Don Regan on January 2nd. So, you know, it had to be 
at least in December. 

Q In that meeting, do you recall Mr. Artiano having a 
discussion on compensation with Mr. Miller and Mr. Channell 
and Conrad with all of you present? 

A I don't recall that, no. 

Q Could it have happened? 

A It could have happened. But my recollection is 
that discussions of money and relationships, that was 
something that Marty had with Rich Miller. 



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Q I understand that. 

I was asking whether or not you were present when 
any of those conversations took place? 

A No, I don't recall being present when money was 
discussed. 

Q Do you remember being present when money was 
discussed with Spitz Channell or Dan Conrad in December of 
19857 

A No . No , I don ' t . 

Q When you told Mr. Regan on January the 2nd or 3rd 
of 1986, that you wanted to arrange this meeting, and he said 
to you I hope you're being compensated for this, was there 
any further discussion about compensation? 

A No, there was not. 

Q Why would he ask you a question such as that? 

A Well, let me set the framework for how it happened. 
I was going to make sure that he knew that it was a 
client matter. I think any time you do something, you should 
always tell people it's a client matter. 

And so it was my intention at the end of talking 
about this group to say this is a client matter, and describ- 
ing who these guys were and what their goals were in helping 
the Administration and, in fact, what their track record was. 
And I said something like, you know, this is, and I told him 
about what happened with that Angola character. I said this 

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is the kind of thing that's like a client — it's a gift from 
God. I mean here you get someone who wants to do nothing but 
help the President, and you're going to help make them more 
effective in what they do. I said it's a gift like God. 

And then his response, as I recall, was, well, I 
certainly hope you're being compensated for it. That's the 
context of it. 

Q And you said yes , I am? 

A I said, yes, I most certainly am. 

Q Was anyone else present at that meeting? 

A It was just Don Regan and I. 

Q Where did that meeting take place? 

A I believe it was the Century Plaza Hotel. Fred 
Fielding was there, but he was in another room. 

Q You went there for the purpose of discussing this 
arrangement with Don Regan? 

A Yes. The request for the meeting. 

Q The request for the meeting that took place on 
January 30th? 

A Yes. 

Q And he indicated to you at that time that he 
thought it was a good idea and that he would see to it that 
such a meeting was arranged? 

A He said based — and again I couched my recommenda- 
tion in terms like this . This is as much as I know about 

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this group at this time. I have checked them out as thorough- 
ly as I can. You are going to have to check them out too. 
And he asked me to put it in a memo. He said it 
sounds good to me, put it in a memo, which I did, and got the 
memo into the system. 

And then, as part of that checkup, was giving it to 
Fred Fielding and giving it to the Secret Service and giving 
it to David Chew. In other words, I papered the place. 

Q You were in Los Angeles on December 2nd or 3rci7 

A January 2nd. 

Q January 2nd or 3rd. And you said you flew down 
from Utah and then you flew back. 

A Correct. 

Q Then did you fly to Washington? 

A Later on. At some point I did. 

Q The next day? 

A No. I would have to look at the calendar. You 
know, it's on the calendar. 

Q You indicate you met with Don Regan in Los Angeles 
on January 2nd or 3rd. 

A Correct. 

Q The memorandum to Don Regan is dated January the 
5th, and you indicated you went back from Los Angeles to Utah. 

You would have had to, it seems, to fly from Los 
Angeles to Utah on the 3rd, and yjg^jjpy^ would have had to 



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Spend all day practically flying here on the 4th, because 
when you go from Salt Lake City to Washington, D. C, how do 
you go, through Chicago or — 

A No. It was a direct flight. 

Q Through or nonstop? 

A Direct to Dulles. 

Q So you don't remember flying back here the next day? 

A Not right away, no. I might have. 

Q How did you get the memo into the memo into the 
White House so quickly? 

A Well, for one thing, I probably did the memo at 
home — I mean it was on my own stationery. 

Q And then you mailed it back to Washington? 

A No. I may have mailed it, I may have taken it 
back. I believe I took it back and delivered it to the white 
House. 

Q You would have had to do that the next day, 
wouldn't you? 

A I'm saying, you know, all you've got to do — 

Q I'm just a little confused. You indicated that you 
flew from Salt Lake to Los Angeles and then back. 

A Salt Lake and home. 

Q And then there's a memo which goes into the White 
House on January the 5th, and you indicated you sort of 
papered the place 



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A It's dated the 5th. It may not have gone into the 
White House on that date. That's the date that is on the 
memo. That means that thing was typed in my house on January 
the 5th, or a date of January 5th was put on it. 

Q Well, did you make more than one trip back to 
Washington in January of 1986? 

A There were several trips back to Washington. 
In January of 19867 
Yes. Yes. 

And were these all related to IBC? 
No. Not related to the Boundary Commission. 
Do you know how many trips you made back to 
Washington in January? 

A Probably two or three trips. Again it will be 
right on the calendar. 

Q Did you talk to Oliver North on the telephone from 
Utah shortly after you met with Mr. Regan? 

A I don't believe that I did, but I may have. I 
r««»aiber meeting with him in the Executive Office Building. 
Q Do you remember calling him on January 7, 1986? 
A I do not recall a telephone call. But, again, I'm 
not saying it didn't happen. I just don't recall. 

Q Would it have been possible that there could have 
been a phone call? 

A I would say it's possible. 



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Q Well, do you remember a telephone conversation in 
which you talked to him about Spitz Channell and Spitz's 
efforts? 

A I certainly had to have a discussion about that 
because I was working on the briefing and making proposals 
that the briefing take place. And, you know, there's clear 
indications in my calendar that I had some meetings with him 
and with the people at Public Liaison. And they had to be 
about that briefing 

Q Do you recall having lunch with Spitz Channel! and 
Marty Artiano and Elliott Abrams in early January? That was 
on January the 6th. 

A If that's the date on the calendar. I mean I don't 
have the calendar in front of me. If that's in there. I 
remember having lunch with all of those participants. 

Q So you were in Los Angeles on January 2nd or 3rd, 
and you were back in Washington at a lunch on January the 6th? 

MR. WORK: Mr. Oliver, if you're going to ask him 
alMut dates. Do you have the calendar over there. Show him 
the calendar and we'll move this right along. 

THE WITNESS: Yes, show me the calendar. And 
whatever the calendar says — 

MR. OLIVER: Well, I've just seen his calendar for 
the first time. 

MR. WORK: You've sought his recollection on what 



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dates he was doing it on several times, and I sit here and 
let you do that to him. But now you've got the calendar over 
there. Let's show him the calendar. 

THE WITNESS: Whatever the calendar says is what 
happened ■ 

MR. OLIVER; Counsel, I've just seen this calendar 
for the first time. 

MR. WORK: That is not my fault. It was delivered 
to you last week. 

MR. OLIVER: As Mr. Fryman said, we didn't have an 
opportunity to read it until this morning. 

MR. WORK: Again, that is not my fault. 
BY MR. OLIVER: 
Q Well, you were compensated on a full-time basis by 
the Huntsman Chemical Company until April of 1985? 

A Correct. Even though the responsibilities were no 
longer full time as of late December. 
Q As of what? 

A As of the month of December. 
Q Had you given Mr. Huntsman notice? 

A He and I discussed that. That was what he proposed 
to make . We sat down and agreed that there would be a four- 
month period in which I could make this transition into the 
consulting business UNCLASSIFSED 

Q Did you write him a letter to that effect changing 



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the arrangement that you had or it was just an oral agreement? 

A We had an agreement between a boss and his employee. 

Q You indicated earlier that there was a meeting that 
was arranged, I believe, by Mr. Artiano, or someone, with 
Spitz and you and Marty and Rich Miller and Frank Gomez and 
Dan Conrad, sometime after the briefing to discuss restructur- 
ing of your arrangement earlier? 

A I don't think it was — 

Q You indicated that someone had said that there 
might have been an arrangement of a certain amount of 
compensation per meeting with the President? 

A Yes . 

Q And that occasioned a meeting? 

A Yes, sir. 

Q Who had said that there might have been such an 
arrangement? 

A I have no idea. I just know that somewhere that 
caaa up and it was discussed among Marty and I, and a meeting 
w«i called by Marty and that was discussed. And that's as 
much as I know. I don't know where 1, heard it, or whether he 
brought it to my attention, or whether someone had told me. 
I just don't know. I just know that it came up. And so a 
meeting was held, you know, to talk about that and to make 
sure that everyone knew exactly what the arrangement was 
between Artiano and Fischer and IBC, and to review the kind 



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of projects that were to be worked on. 

Q Did you ever have a discussion with Oliver North, 
meeting on January the 30th, about bringing in people quietly 
to have briefings or to have their photos taken with the 
President? 

A No. I believe the only person that ever brought 
that up to me or it was discussed would have been with Rich, 
and it may have been Rich alone, or it may have Rich, you 
know, with his client Channell. But it was discussed among 
Artiano, Fischer, IBC group. 

Q Not with Oliver North? 
A I don't believe it ever was. 

Q Do you remember meeting with Oliver North on the 
day of the briefing at the White House? 

A You're going to have to tell me on the calendar. I 
don't know that I did. I don't think so. 

Q Did you and Marty Artiano meet with Oliver North in 
January of 1986, the two of you together? 

A The meetings that are listed under — just has 
North's name, who was at that, I know, was I alone or with 
anybody else, I just don't remember. There's no indication 
of that. 

Matter of fact, I must tell you that there's a 
chance that, you know, that is not necessarily an adequate 
reflection of what happened. Sometimes, you know, as we do 



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Of the Public Liaison Office. 

Were those separate meetings or were they meetings 



on all of our calendars, you write something down that's 
going to happen tomorrow. It doesn't happen, and you never 
go back and take it off. 

Q Well, your calendar indicates a meeting with Oliver 
North at the NSC on Tuesday, January the 21st. 

A Okay . 

Q Prior to or in conjunction with a meeting with Linas 
Kojelis . 

A 

Q 
together? 

A As I recall it, it was — I don't believe I knew 
who Linas Kojelis was, and I think he was to be the Action 
Officer, and I think either North took me down to introduce 
me or phoned, or somehow I believe that there was — North 
was introducing me to Linas Kojelis as the fellow who had 
responsibility for the briefing. And that was where I recall 
about that thing. 

Q Was that the first time you ever met with Oliver 
North? 

A I don't know. I may have met with him in December 
about this briefing. 

Q Prior to these briefings, you had never met with 
Oliver North before? 

A No, not before the subject of this brief,4fig,c^me , 

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up, no. No. 

Q Why did you meet with Oliver — why Oliver North at 
this point? 

A Because he was the one who was the spokesman for 
the Administration. He's the one that had participated in 
all of the briefings that Channell's groups had had. And I 
knew by his reputation that he was giving speeches all over. 
He was like the spokesman on this issue for the President. 

Q Did he ever indicate to you that he was being of 
assistance to the Contras? 

A Of assistance to them? 

Q Yes. 

A Well, I think he believed in those briefings he was 
being of assistance to them out there giving briefings and 
educating people. 

Are you saying beyond that? 

Q Yes. 

A Not that he ever told me. 

Q Also on your calendar there's a meeting with Oliver 
North indicated from 5 o'clock until 6:15 on the 28th of 
January, which would have been two days before the briefing. 
Do you know what the purpose of that meeting was? 

A No. Can I just see that real quick? 

Q Yes. 

A No. It had to be about the briefing. 



UNCLASSIFIED 



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Q Following that was a meeting with David Chew. 

A Yes. That would have been about the briefing. 
That could have been about other issues too. 

Q Did you tell President Reagan, when you met with 
him prior to the briefing, that you were being compensated 
for the work that you were doing? 

A I don't believe that would have been the kind of 
conversation that I would have had with the President. 

Q You indicated earlier that you had told everybody 
or everyone that you were being compensated. 

MR. WORK: Wait a minute. I don't think he said 
that. 

MR. OLIVER: I think he did. 

MR. WORK: I'm quite sure he didn't. He told Don 
Regan, he told — 

BY MR. OLIVER: 

Q Who else did you tell besides Donald Regan that you 
ware being compensated by IBC? 

A Don Regan. I believe Fred Fielding, Peter Wallison 
who took over Fielding's position, you know, what people in 
the NSC I don't know. You know, I would assume that maybe 
some of the people on the NSC staff, on the SDI issue. You 
know, at that point, 1 don't know. 

I do know that I talked to the Counsel's office, 
and I talked to Don Regan. 



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Q What occasioned your discussing this with Peter 
Wallison? 

A Peter Wallison had become the new Counsel to the 
President when Fred left. And we were working on the 
proposal for an SDI briefing. I did not know Peter Wallison 
so I asked for an appointment with him so I could meet him, 
talk to him about what had happened on the other briefing, 
what this group was doing on SDI, and talk about the SDI 
issue and about the fact that there would be a proposal 
pending, there would be one coming requesting a briefing for 
the SDI issue, similar to the one that had taken place for 
the Central American Freedom Program. And that was to happen 
like in June, June of '86. 

Q Prior to the January 30th briefing, you had met 
with Fred Fielding to discuss — 

A No, I believe that had met directly with Fred. It 
may have been with, you know, I can't think of his deputy, 
but Dick Hauser, it may have been Dick Hauser. 

I seem to remember meeting directly with Fielding 
because I'm positive I raised, when we were going over the 
list of names, here's all the names, I said they are into the 
Secret Service or checked. The only name that I would red 
flag in this is Bunker Hunt. And his response was there's no 
problem with Bunker Hunt. He hasn't done anything. 

Q When you say red flag, what do you mean? 



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A Well, what I was trying to do in this business, of 
always trying to be careful and making sure that I wasn't 
recommending something that was not a good idea or in the 
best interest. I was trying to check out all these people 
and who they were. 

What I did on this in preparation for the proposal 
for the January 30th briefing, I asked Miller and Channell to 
get a list of all of the people that they wanted to attend 
that briefing with social security numbers and date ot birth 
and all that. This is before it was proofed. 

I got that to the Counsel's office and said these 
are the kind of people that they want to invite in, and I 
gave a copy to the Secret Service also so they could start 
running, in advance of this meeting being on schedule, to run 
name checks . 

Q Is it ordinary procedure in the White House for 
people who are going to visit the White House or to be seen 
by the President to be run by the Counsel? 

A I believe that any meeting that goes on, anything 
that goes on the schedule, I mean that's the first time I had 
seen this kind of internal paperwork, things have to be 
signed off as I believe correspondence is signed off by 
someone in the Counsel's office. And one of the things that 
you do is you attempt to have the Secret Service run name 
checks to make sure that you are not bringing some axe 



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murderer into the White House. 

Q I understand the Secret Service running name 
checks. But what I'm trying to — 

A But part of the Counsel's responsibility is also 
more political. You may have somebody on there that is not a 
criminal but maybe has done some horrendous thing in public, 
and the last thing in the world you want is that person 
standing next to the President and have his picture — that's 
the kind. 

Q Of course. I understand that. 

But whenever someone arranges a meeting with the 
President of the United States, is it the normal procedure 
for the Counsel to the President to be consulted about 
whether or not — 

A Yes. If not the Counsel directly, the people on 
his staff. I believe everything that goes on gets signed off 
by the Counsel's office. 

Q Every meeting with the President he — 

A That's absolutely correct. 

Q When you had been there, you were the person who 
sort of was the last person at the door before people went in? 

A By the time it was on the schedule, it had gone 
through whatever this horrendous system was and been signed 
off by all the office that had to sign off, and then it gets 
on the schedule. 



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Q Including the White Counsel? 

A I believe that everything went through Counsel's 
office. 

Q Everything? 

A That is my belief. You know, I never had to 
initiate while I was there. It was not my job to initiate 
meetings or proposals for meetings. All that stuff — 

Q I understand that. But did you — 

A My understanding of the system is absolutely that 
one of the steps to having something approved is to go 
through some area of the Counsel's office just to make sure 
that everything is okay here. That's my understanding. 

Q Well, that's why I was asking because you had that 
job for four years . 

A But my job did not encompass deciding what went on 
the schedule and what didn't. 

Q You said that everybody, all these different 
offices checked off on it? 

A What I'm saying is that that had to happen before 
it ever got on the schedule. 

Now what the system was, and precisely each step 
that went on, I don't know what the step was. It was always 
my understanding that Counsel's office carefully checked 
everything that went on. That was part of their respon- 
sibility in protecting the President. 



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Q So why did you need to go and meet with Fred 
Fielding if it was done as a matter of routine? 

A Because what I wanted to do, because I was personal- 
ly involved in this, and I wanted to let him know, as I 
wanted Don Regan to know, that I was trying -- on my own, I 
did the best that I could to check out who these people were 
because I didn't know firsthand. I had limited exposure to 
them. I only knew early on what they were telling me. And I 
was judging from their record, which I thought was good. 

But as more protection for me also, I wanted people 
to know that I was being very upfront about this thing, 
providing even though it eventually would come that way, if 
you get it right into the Counsel's office and say, look, 
this is a proposal and these are the people being invited, 
and I've checked them out as best I can, but I don't much 
more, that's going as far as you possibly can in trying to 
protect yourself, protect the White House. 

And so, if it turns out if you recommend something 
that is horrendous, you don't want somebody to look back and 
say, you know, look what this guy did. That was my attempt 
to be as open as I could. 

Q You discussed it with Fred Fielding? 

A I remember it as being Fred Fielding. The only 
reason I remember it is because of a discussion about Bunker 
Hunt. 



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I mean you remember i^ something unusual has to 
happen, and I remember looking at the list. Bunker Hunt, the 
name bounced out at me. And I thought maybe this is a 
problem. 

Just like in my discussion with Peter Wallison on 
SDI, the question that I had for him, and that's why I 
remember the meeting so well, is these people, some of the 
invitees are representatives of companies who do business 
with the Defense Department on SDI, and is it proper to" 
invite them? 

Q Did you tell Mr. Fielding at that time that you 
were being compensated for arranging these meetings? 

A I may have; you know, I honestly can't say whether 
I did or not. I know I did with Wallison because he was a 
new guy and I wanted to go to extraordinary lengths . I 
believe that I did. But I can't sit here and tell you I know 
exactly, as I can with 

Q You remember you talked to Wallison and told him 
you »»ere being compensated? 

A I absolutely did. 

Q What was his reaction? 

A I think he probably assumed, as most people do, 
when you are back in the White House that you are on a client 

UNCLASSIFJEO ,, 

Q You indicated that you rememDexed" LlHmg Wallison 



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you were being compensated. 

A I remember telling Peter Wallison, but it was in 
the context, too, of--I specifically had a question; I had a 
concern about the list of potential invitees on the SDI 
briefing, and I raised that one issue of whether it was 
proper; that meaning the red flag to me — it was a totally 
different issue. We had people here who represent companies 
who do business on SDI. Is that a proper kind of person to 
invite? 

Q My question to you was what was Mr. Wallison 's 
reaction when you told him you were being compensated? 

A I don't remember any kind of reaction. But I think 
again, when any time someone came back in there after they 
left, you know, it was 

Q Did he make any response to your disclosure of 
compensation? 

A No, I can't recall that he did at all. 

Q Did that briefing ever take place? 

A It was scheduled and it got cancelled; it was going 
to be put on again, and it never got put back on. 

Q When was it scheduled? 

A I believe it was June of 1986. 

Q Of 1986. 

A I think that's right; it may have been July, but I 
believe it was June, and it had been approved. 

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186 



Q All the way to the top? 

A Yes. ' * ■ •' 

Q And Mr. Wallison had signed off on it in the normal 
way saying it was okay to do this? 

A Yes, but it was because of the issue that I raised 
that it had to be cancelled. And that was the fact that some 
people had been invited — the issue to me was: can you invite 
people who are representatives of defense contractors to a 
briefing on SDI? His initial response to me was: as long as 
it's a mixed group, of course you can; no one is asking for 
anything here, it's okay. What happened was the invitations 
went out and Channell jumped the gun; instead of letting 
Public Liaison or whichever office the White House decided 
was going to do the briefing, he sent out his own telegreim 
and it got to a defense contractor who knew Peter Wallison; 
he brought it in and said take a look at this. And then I 
was called in by Peter Wallison. 

Q Who was that defense contractor? 

A I can't answer that, I don't know who it was. But 
I was shown the actual telegram or mailgram that Channell 's 
organization sent out, and Peter said do you know anything 
about this. I said I do not know anything about it. And 
after reading it, he said what do you think, and I said it's 
got to be cancelled. And it was cancelled. 



Q When did that meeting take placed 



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A Some time prior to — you know, if the briefing was 
going to be in June--you know, several weeks before — maybe 
within a month of when the meeting was to take place. In 
other words, there was a target date set for the briefing; it 
had been signed off on; and then, because the group had done 
their own inviting ahead of the White House inviting, it was 
determined that that was not a good way to do business, and 
so therefore Mr. Wallison decided to defer [sic] an air of 
caution, and he said it's off. 

Q Prior to the January 30th meeting, hadn't these 
people who came there, these nineteen potential contributors, 
been notified that they were going to receive an invitation? 

A I have seen paper work that makes me think that 
they were, but I didn't know that they were. 

Q Did you know that they each received a letter from 
Oliver North that was mailed from the White House ten days 
prior to that meeting? 

A I did not know that, and I haven't seen the letter. 
I have no knowledge of that at all. 

Q You indicated at an earlier time that one of the 
reasons for wanting a meeting to restructure your agreement 
or to bring about this acceleration of payments was some 
concern that this might not last, and that somehow 

A May be a client this month and not the next month. 

Q You also mentioned that there was a vote on contra 

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188 



aid that somehow figured in that concern. What was that 
concern? What was this vote that you were talking about? 

A I believe the vote that I am referring to is the 
one on whether or not there was going to be the passage of 
the big aid bill, the 100 million, or whatever the dollar 
amount was, that Congress--you know, this is what all these 
public education spots were leading up to. And there was a 
concern among I know Miller and IBC, and there was a concern 
with me personally that who knows where this relationship is 
going to go. Channell had talked to me about other entities 
that he was going to put together that went way beyond this 
Administration, and in fact he had a very ambitious plan to 
form a foundation that was going to be funded before Reagan 
left office to allow him to go on radio or television any 
time he wanted to after he left office, and he had people all 
lined up ready to put the money in. And that was a project 
that he wanted me to get intimately involved with and 
probably even run it for him after Reagan left office. 

So what was happening at that time was a fear of 
Miller's that maybe, you know, his client, Channell, if he 
doesn't have a need for Miller any more, that may disappear, 
or — and, you know, I didn't know what was going to happen. I 
was more secure in my position than I think Rich was at the 
time. And so it was a concern over the volatility of, you 
know, not only the client, but tll4*^M>es the client was 



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working on; if he wasn't working on issues on which you could 
help him, there was no reason to have you as a consultant any 
more. 

Q Was there a time in April of 1986 on or about the 
date of the vote in the House that Rich Miller indicated to 
you that Spitz Channell was not going to compensate the 
people involved in the Central American Freedom Program any 
longer? 

A My recollection is that the vote wasn't until "June, 
but I may have my dates all mixed up. No, I don't recall 
anything like that. 

Q Did he ever tell you that Spitz Channell was in 
effect cutting everybody off? 

A In April of 

Q Of 1986. 

A 1986? 

Q Yes. 

A No, I don't recall that. You know, there were 
certainly times later on in the summer, particularly when he 
lost his SDI program, when that thing got postponed, and the 
Central American Freedom Program was no longer needed--that I 
know there was a concern of Rich of exactly what kind of 
programs is IBC going to have, because they had done so much 
research and writing for Channell on these other issues, and 
there was a question as to where they were going to go, was 



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SDI really going to happen, or was Channell all of a sudden 
going to switch — and he would switch programs : he may be 
going full bore on one thing, and he'll very quickly do a 180 
and refocus on some other issue. It's whatever, you know, he 
wanted to do at the time. That was always a concern, because 
you really never knew where the guy was going to be almost 
day to day. And he ran his operation very tightly, and it 
was whatever he decided to do what his organization was going 
to do; he didn't need a board of directors to tell him--he 
was the board of directors. 

Q And you dealt directly with him? 

A After a while, particularly when we had the 
separate arrangement, I was dealing at times directly with 
him. 

Q You were concerned that this thing might not last 
and therefore you went after this acceleration, and you knew 
of Spitz Channell 's volatility — I think you described him as 
a volatile person. Why didn't you seek a binding contract or 
something in writing? 

A Those binding contracts aren't worth the paper they 
are printed on- A personal service contract, you know, it's 
not the kind of thing you are going to go into court to try 
to enforce. First of all, I don't think a court would; and, 
second of all, who would want to — you know, if someone 
doesn't want you to perform services or you are doing a lousy 



u to Derrorm services or yi 



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job for them, it's their right to cut that off. 

Q So you don't believe in written contracts. 

A I believe in some written kind, but personal 
service contracts I think are very suspect and I don't think 
they have — I personally don't think, and I know it was 
Marty's opinion that they are not worth the paper they are 
printed on. If someone doesn't want to honor it, what are 
you going to do? Are you going to drag them into court? 

Q Yes. " 

A But on a personal service contract I think it would 
be very difficult. All the guy has got to do is go in and 
say, look, this guy promised to do this for me, his perfor- 
mance is unsatisfactory, he broke the contract. 

Q After your initial arrangements with IBC and Spitz 
Channell, did you receive any compensation from the Federal 
Government other than your nominal sum from the Boundairy 
Commission? 

A No, sir. 

Q Did you do any work for any government agencies? 

A No, sir. 

MR. WORK: How much longer are you going to go? 
MR. OLIVER: I don't know. Off the record. 
[Brief discussion off the record and brief recess] 
MR. OLIVER: If we could go back on the record, Mr. 
Buck has a few questions that he wants to ask, and he has 

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192 



another engagement, so I will defer to him temporarily and 
continue my questions when he has completed his. 
MR. BUCK: Thank you very much. 

EXAMINATION BY COUNSEL FOR THE 
HOUSE COMMITTEE 
BY MR. BUCK: 

Q I want to clear something up about the acceleration 
of payments question. This concerns the agreement you had 
with IBC in December of '85, January of '86. 

Is one of the main reasons that the payments were 
accelerated was because the work was accelerated? Or why 
don't you give me the reasons why. 

A The work load continued to increase at a very rapid 
pace. What was envisioned in December changed in January, 
and continued to change. And so increased demands, an 
increase in the number of projects, that certainly would have 
been a factor, yes. 

Q Let me give you a hypothetical and see if this 
sounds reasonable. If you were going to be paid $20,000 a 
month for a year and you expected that you would be working 
about 500 hours a year and, after a month or two, you figured 
out that you were going to be working 500 hours within the 
first six months, and you accelerated payments, would that 
seem consistent with what we are talking about here? In 
other words , ^c 



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period of time. 

A Let me see if I can do this without being confusing, 
when acceleration was made, thought was never given to that 
hypothetical about, well, that means you are going to work — 
for every month that you take up front means you are going to 
work for free here. That was never talked about, I don't 
believe ever thought about. The situation was so fluid and 
literally changing month to month that what was going to 
happen six months down the road, nine months, a year, frankly 
was not even thought about that much, because, again, it was 
a very fluid situation. 

But there's no question that what was contemplated 
and what was asked of in December changed very rapid. There 
was just a lot more expected. 

Q Did you do considerable work for clients other than 
IBC during the relevant time period, that being December '85 
on? 

A Yes, there were other clients that had nothing to 
do with IBC, that I did a considerable cunount of work on. 

Q How would you split it on a percentage basis? 

A I can do it by percentage of income. 

Q Okay, why don't you give us percentage of income. 

A This is going to be a ballpark figure. I believe, 
if you add up all the compensation that was put into David C. 
Fischer & Associates in 1986, 60 percent I think is about 



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right--I think one time I guessed it was 75 percent or 80 
percent--was IBC I think 60, now that I look at it, is a 
little closer — 60 percent, IBC-related; 40 percent, totally 
non-related to IBC. 

Q Unrelated to IBC, unrelated to any of the Channell 
organizations . 



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Q We've talked a little bit about this question so 
far this morning and this afternoon, and I just want to ask 
you, to find out for the record, did you ever sell White 
House visits for any price? 

A No, I did not sell meetings at the White House. 

Q Do you know if anybody in the White House ever 
received any money from yourself, Mr. Miller, or any of hi^ 
organizations, or Mr. Channell, or any of his organizations', 
for meeting with any of Mr. Channell 's contributors? 

A No. Again, they didn't have to; they were getting 
just about what they wanted. I was able to look in the 
record and clearly establish that they were invited frequently 
into the White House — their contributors were in the White 

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House. And I'd like to put one other thing: even after the 
relationship that they established with me, they continued to 
be invited. And there was a meeting in April of '86 — it had 
to do with the photograph that I saw with Channel 1 and the 
President — and I said I don't remember that ever taking 
place. And I was told that Miller and Channell had been 
invited to a briefing in the cabinet room on this issue. I 
never knew about that until six months ago when I said that 
photograph, when did that take place. And they said, oh, it 
was a briefing. So they continued to enjoy access, very 
intimate access, without my participation, without my 
encouragement, and in fact, because they had had it for so 
long, and I believe they had it because they deserved it; I 
mean, they were performing obviously what the Administration 
thought invaluable services. 

Q What was your knowledge of Mr. Channell 's fundrais- 
ing, organizations, and techniques? Were you intimately 
involved with his fundraising? 

A No. The thing that impressed me about Channell was 
that, number one, he seemed to be highly organized. He 
seemed to have the ability where people — and I will put this 
in context of the Reagan Library, when we met with people 
from the Reagan Library, he wanted to assist them in figuring 
out how to raise big dollar amounts. Where they thought in 
terms of little amounts, which would still be big to you and 



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I, he thought in much bigger terms; he would think in terms 
of getting people to donate half a million, a million 
dollars, five million dollars. And that is the grand scale 
that, you know--so that was the thing that impressed me about 
Channell, his ability to raise money and to put together 
programs that people wanted to contribute to. 

Q Did you have any knowledge that money being raised 
by Mr. Channell or Mr. Miller was being used to directly 
assist the contras? 

A No. 

Q This is at the time, not what you read in the media 
afterwards — but at the time, did you have any knowledge that 
any of the money being raised by Mr. Channell or Mr. Miller 
was being used to buy weapons? 

A No. 

Q Did you ever hear the subject of weapons discussed 
at any meetings which you attended? 

A Yes, in that one briefing in particular with Bunker 
Hunt, in which, as part of his briefing, he talked about the 
needs of the contras. But that's the only time that I ever 
recall ever hearing that. 

Q Did you ever hear Colonel North solicit any 
individual for money? 

A The only time I was with him with a contributor was 
Bunker Hunt, and, you know, when I was there he did not. It 

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was a straightforward kind of briefing. 

MR. BUCK: I have no further questions. Thank you, 
Mr. Oliver, and thank you very much, Mr. Fischer. 



FURTHER EXAMINATION BY COUNSEL FOR 
THE HOUSE COMMITTEE 
BY MR. OLIVER: 



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Q 1 want to switch back to another subject, if I may. 

You indicated earlier in the discussions with Mr. 
McGough and Mr. Fryman that — I think you used the word 
"passthrough" -- that the arrangement was that Channell would 
pay $20,000 to IBC, and IBC would pay $20,000 to you or to 
Mr. Artiano, or 10,000 to each. 

How did that work? 
A No. The original agreement that was struck in 
December, or whenever it was in '85, was for the $20,000 — 

MR. WORK: I want to object to this since we are 
now going over it for the fourth time. Every questioner has 
asked him this question. And I know you have a right to ask 
him the question, but everyone has asked him this question. 
And I hope you will be short. 

And I think it is objectionable because every 



questioner has asked it. 



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MR. OLIVER: Your objection is on the record, 
counsel . 

THE WITNESS: I'm tired. The original agreement 
with Artiano and Fischer and IBC was strictly with IBC. 
There never were discussions at that point that I'm aware of 
that said, well, all this money, even though we knew that the 
vast majority of work was on behalf of his client, Channell, 
his obligation was a long term that IBC personally agreed to. 

When we were making a reference to Channell putting 
$20,000 in, that became later on, and that one was because he 
wanted me to work for him personally. And I said no, I will 
continue my relationship with Miller, and everything will go 
through Miller. 

Q I understand that, but your $20,000 a month, which 
I believe was the compensation that was agreed upon at some 
point, was basically what you were paid. My understanding is 
that $20,000 was paid by Spitz Channell, NEPL, whatever, to 
IBC, and then IBC wrote a check to either David Fischer 
Aasociates or Marty Artiano or you. I mean the $20,000 
passed from Channell to IBC to you, or to you and Marty. 

A I can assume that that is what happened. As far as 
discussions in those early stages when the deal was negoti- 
ated, I do not know, because, you know, I did not participate 
in those discussions. 

I can tell you when I did have a conversation is 

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when I struck that separate deal with Channell when he was 
trying to get me to work for him in which he wanted to do it 
directly, and I said it will go through IBC. And that is the 
time I had discussions about particularly how money was 
handled. In other words, it was Channell to IBC, and I had 
that discussion, and I — 

Q And you talked about the exact amount a month of 
money? 

A Correct. 

Q So that exact amount of money went to IBC, as you 
had agreed, and then you got the exact amount of money that 
you had agreed upon with Channell? 
A Correct. 

Q So, out of this arrangement, IBC didn't get any 
money? 

A Well, IBC at that time had separate arrangements 
with Channell on a wide variety of programs for which I 
believe they were being compensated for. What they were 
being compensated exactly for all of the projects, I have no 
knowledge. That was not discussed with me. 

Q But as far as David Fischer and Marty Artiano were 
concerned, there was not a cut taken by IBC out of the money 
that cemie from Channell to pay for your services? 

A Until I formed a separate agreement with Channell. 
How Rich Miller billed Channell, if that's what he did, or 



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what funds he used, where he came up with that 20,000 a month 
to pay to Fischer and Artiano, I had no discussion with him, 
that was not a concern of mine. I just know that I — 

Q You did not know that the money was coming from 
Spitz Channell? 

A I assumed that it did because we were working on 
matters pertaining primarily to his client, Channell. 
However, until I had specific discussions with Channell later 
on, a couple of months later, whenever it was, in which -we 
were talking about the separate arrangement, I knew I was 
negotiating with him at that point exactly how this was to 
take place. This was when he was trying to get me to work 
for him, and he wanted to pay me directly. 

Q This was in? 

A April or, you know, sometime in the spring. 
And so, in the initial arrangement, how Rich 
Miller, how he did his books and how he billed, what amount 
he was billing to Channell, I couldn't tell you. I haven't 
the foggiest idea. I have never seen the IBC books to this 
day. 

Q So why did you have a meeting, or why was it 
necessary for you and Marty Artiano to meet with Channell and 
Conrad and Miller and Gomez after the first White House 
meeting if your arrangement was with IBC? 

A Because the work was being done in behalf of 



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Wuhmfnxi. D C 20002 



UNCLASSIFIED 



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Channel 1. 

Q Which work? 

A The work that we were engaged in, the meeting in 
January, all of these projects we were doing on behalf of 
Spitz Channell. That is why that issue was brought up, when 
this rumor was heard, or whatever it was, that resulted in 
this meeting in which it was discussed among all the par- 
ticipants- 

Q And at that meeting did you discuss this rumor? 

A As I recall the meeting, as I've said earlier, 
Marty Artiano conducted the meeting, and he brought up the 
issue, recapped what we understood the relationship to be. 
As I recall, everyone said that's exactly what it is, or 
concurred, or no one raised objections or whatever, and then 
went on to other matters. 

It was just something, you know, that had come up. 
You know, Marty wanted it discussed with everybody. And I 
don't believe that that meeting was just called for that 
because periodically we would all meet together in the board 
room and go over the wish list and decide who was going to do 
what, and divide assignments up. And I believe this just 
took place at one of the meetings. 

And it was, you know, i}: was on the agenda, and 
Artiano, as I recall, is the one that addressed the issue to 



everybody . 



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Q When did you first ask Rich Miller to arrange for 
an accelerated payment in January of 1986? 

A I did not ask. Artiano asked. 

Q And when did he ask? 

A I can't tell you. I have no idea. Sometime in 
January. 

Q Did you think you needed an accelerated payment at 
that point? 

A I must have, you know, because I agreed with it and 
received a check. 

Q Well, you had already received checks in December 
and probably early in January? 

A Yes. 

Q And you received another check? 

A Again this had to do with the concerns that I've 
already expressed; number one, that there were increased 
demands on what was expected, increased demands on my time, 
and projects that were envisioned greatly exceeded what was 
originally envisioned in the relationship. 

And as I've said before, this relationship, it is 
an exaggeration to say it even -- I mean it was, at a 
minimum, changing month to month. It was almost week to week 
new things were coming up. And, all of a sudden, we went 
fro.ti something that existed in December with the projects 
I've described, and in January we were in a total different 

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ball game, totally unrelated to what was originally en- 
visioned. 

Q Other than arranging meetings with Government 
officials for Channell's people and for Channell, what else 
did you do for Spitz Channell? 

A For Spitz Channell, a lot of the meetings that we 
had and a lot of the effort that was spent was on not only 
these meetings with Government officials, but was on a lot of 
the projects that he envisioned doing in the future. 

He had conferences that he wanted to hold, con- 
ference on terrorism, one on pulling in a future of conser- 
vatism conference that he wanted to have in 1987. 

There were the Reagan Library efforts that were 
non-related to the Government. There was the Reagan Founda- 
tion, I believe was what he was calling it, on putting 
together this organization in this Foundation. 

Q And what did you do in relation to those projects? 

A Well, in those kinds of projects, it was a matter 
of putting together game plans for him and figuring out how 
he could go about and achieve these objectives. A lot of 
times — 

Q Did you put together those game plans? 

A Some of them we did, yes. 

Q Do you still have copies of those geime plans? 

A No. You have copies of everything that I have. 

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In another area, he had a program in which he — 
and I can't remember the name of the program — in which he 
wanted to put together commercials to — he had commercials 
that were very prone; in other words, on SDI, we'll find 
Congressional Districts that support the President and we'll 
put commercials in those districts. 

He also had ideas to do a negative campaign on 
specific Congressmen. And I remember — 

Q Did he discuss those with you? 

A He absolutely did. Rich Miller and I in a res- 
taurant. I remember it so clearly because of the subject 
matter that was brought up, and he described his program of 
targeting certain Members of Congress who had been, you know, 
vigorously opposing the President on certain issues, SDI and 
also the Contra issue, and running some negative ads. And he 
asked -for our opinion, and Miller and I, in the strongest 
terms, told him that it was a terrible idea. And I remember 
so well saying you admire Ronald Reagan, and you say that you 
takm his lead. You know that Ronald Reagan doesn't believe 
in negative advertising. It backfires, it doesn't work, and 
you shouldn't do it. 

And I think the record is clear that he went ahead 
and did it. But, you know, it was my opinion — 

Q Did Rich Miller help him do it? 

A I don't believe so. He was as opposed to that as I 

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was. And I never heard of that program again. 

But I know that he went forward with it. Now, if 
Rich had separate meetings with him, he may have, I don't 
think so. Because Rich was opposed to it alsorj 

Q He told him that he was opposed to targeting 
Congressmen who opposed the President for ads? 
A Negative campaigns. 
Q Negative campaigns. 

A He was opposed to negative campaigns where you 
target specific Members and say this person opposed the 
President on this issue and he ought to be defeated in the 
election. That kind of campaign, I know that Rich was 
opposed to that. 

Q Were you aware that the ads for that negative 
campaign were paid for by the people who attended that 
briefing that you arranged at the White House on January 30th7 

A I don't know how the funding came in for that. You 
know that Channell had so many organizations, and who gave to 
what organization I can't tell you. Or even what entity he 
created . Maybe that was that ATAC group that I ' ve heard 
about. Maybe that was the negative ads. 

I don't know what entity or who paid for it. 
Q Was there any discussion surrounding the January 
30th briefing either before or after or during where they 
talked about the ads that would be run as part of the Central 

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American Freedom Program during February and March and April 
of 1986? 

A Each time there were new ads in the works, I was 
able to look at them after they were completed. 

Q Look at the story-boards or look at the cassettes? 

A No. I actually saw the finished product when they 
came out of the agency. And those were always passed over to 
the Administration. They were able to view them. 

Q Did you review the Mike Barnes ads when they came 
out of the agency? 

A No. I don't know if I saw the Mike Barnes ad. I 
did see. the one on — was it McCloskey? I think I saw one 
negative ad one time, and I believe it was McCloskey or 
Mikulski . 

Q Did you see any positive ads on the Contras? 

A Oh, all of them. I mean, when I say positive, it 
would support the President, I view that as a positive ad. 
When you start targeting a specific member and saying, you 
know, this person opposed the President and you ought to 
defeat him and elect somebody else, that's negative advertis- 
ing. 

Q At the luncheon which took place on January the 
6th, which Marty Artiano arranged with Elliott Abfams, you 
were present? 

A Yes, I was. 



^ffOLASSIFiED 



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1 Q Was Barbara or Adam Goodman present also? 

2 A I don't believe so. No, I'm positive they weren't. 

3 I don't think I even ever met Mr. Goodman. 

4 Q Did Spitz Channel! show the story-boards for ads to 

5 Elliott Abrams at that luncheon? 

6 A I believe he did at that luncheon. 

7 Q And you saw those story-boards? 

8 A I have seen them. You know, I can't definitely 

9 recall, but I believed that it happened. We couldn't have 

10 shown them to Tate in a restaurant so I believe that was part 

11 of it, was to educate as to what they were doing on the ads. 

12 Q On the ads. 

13 And how did Elliott Abrams react to these story- 

14 boards? 

15 A Again my recollection was that — excuse me — that 

16 he was very impressed with what the group was doing. 

17 I don't remember anyone in those early days, until 

18 maybe the negative advertising, that anyone ever raised any 

19 objections or concern about those ads. No one ever said 

20 those guys are going too far, or we don't like the context. 

21 I mean the text of it, or we don't think that's Administration 

22 policy. I never heard — I don't think I ever heard a 

23 negative comment in those early days on their ads. 

24 Q Did you know that those ads were being run in 

25 specific districts that were related to upcoming votes in the 

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Congress? 



WNCUSSiriED 



A Yes. 

Q How did you know that? 

A I knew that he had a polling expert, Finkelstein, 
that Finkelstein was at least a pollster that he used. I was 
more familiar with the SDI because I got to see the SDI 
polling. I never saw anything on the other issues. On SDI, 
I did, and I got to go through the whole study. 

So I was aware that he was doing some in Congres- 
sional districts. And I know in the SDI program, they were 
targeting specific places where they wanted to run, support 
the President on SDI ads. So I'm kind of assuming from that 
the same thing wafe done for the Contra issue. But they 
bought in specific Congressional districts. 

Q Did you participate in any meetings that were 
related to the upcoming Congressional vote in January, 
February, March, April or 1986, where the legislative 
strategy was discussed? 

A It had to be discussed at some of the meetings, but 
I just don't have a specific recollection of it. It's not 
the kind of thing that would stick in my mind. 

Q Did you know Dan Kuykendall? 

A Yes, I met Dan Kuykendall. I did not know him 
until — 

Q When did you meet Dan Kuykendall? 



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A I don't think I met Dan Kuykendall until late 
spring probably of '86. I'd have to say that would be my 
guess . 

Q What was the occasion? 

A I think he was brought in in the context of some of 
these programs. And I knew that he had done some Hill work, 
was a consultant of Channell's. 

Q He was brought in. Where did this meeting take 
place? Was it a meeting at Miller's office? 

A Yes. As I remember, you know, I don't know whether 
that was the first, but I do remember sitting down at a 
meeting with Kuykendall in Miller's office? 

Q Were there several other people at that meeting? 

A Yes, I think there was. If l remember, it was in 
the conference room. There were people sitting around. 

Q Were they discussing the vote and legislative 
strategy at that time? 

A I can only assume because Kuykendall was there that 
thay would have been. But I just don't have a real — and 
again I could be way off. I may not have met him until the 
summer. I just can't pinpoint exactly when Kuykendall came 
into it. 

Q Do you know whether or not Rich Miller was involved 
in the targeting of the Congressmen against whom ads were run? 

A I can only suppose from his reaction at that lunch 

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when negative ads were brought up and the way he opposed it, 
that I would be very surprised if he was involved in negative 
targeting. 

Now, he was probably involved in targeting of 
support the President ads, which I don't call negative. But 
the ones where they were negative ads about specific Con- 
gressmen, I would be very surprised if he was involved with 
that. 

Q You don't know whether he was or not? 

A I don't know. Not only that, if Channell's polling 
data was as good as it was, I don't think he needed anyone to 
figure out where he was going to put his ads. He really did 
some very, very extensive: polling ads. 

Matter of fact, he shared it with the White House. 

Q What prompted you to incorporate, or did you 
incorporate as David C. Fischer Associates in January of 
19867 What prompted you to do that? 

A It was a matter of forming some business entity, 
and someone recommended incorporating. A law firm in Utah 
said this is the best way to do it. 

Q When did you discuss it? 

A Sometime prior to incorporating, probably December 
of '85. It may have been as late as, you know, early 
January, something we did, you know, fairly quickly./ 

Q And you incorporated in Utaf 



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A Yes. 

Q Do you remember the date of the incorporation? 

A No, I don't. I don't. I'm assuming it was early 
January of '86. It was definitely January. 

Q You said that you had no policy input in the 
various meetings in the White House, that you were primarily 
a facilitator of meetings and arrangements and so forth. 
Did you have any policy input into what IBC or 
Spitz Channell's organizations were doing? 

A What do you mean policy? 

Q Well, you indicated you heard this term "strategic 
planning"? 

A Yes. Well, those are two different things. 
Strategic planning doesn't necessary mean just policy. And 
even in the White House, the kind of activity that I had a 
part in would be in this area of deciding — and this isn't 
policy — but if you take issues with the President who wants 
to go out in the country and get across with its education 
and the schools or whether it's SDI, then groups of us would 
sit around and say okay. This is the issue. How do we go 
about and put him, the President, in settings to get this 
message across and make news out of it? And we would sit 
around and strategize. We would strategize about what to do 
on foreign trips, and I was part of that process. 

Q You indicated that you asked Channell to show you 



Heated tnat you asked Char 

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who they met with at the White House, that you gathered a 
number of these papers and so on, and take a look at what 
they had done? 

A Yes. 

Q When did you ask Channell to do that? 

A I believe it was in December of '85, or I asked 
Rich or both of them tell me, show me who you are, give me 
all the information that you've got, along with the cassette 
tape of the commercials, along with story-boards. I got 
correspondence, lots of letters from Ronald Reagan to Spitz 
Channell, correspondence indicating that samples of telegrams 
from the White House inviting people to meetings . 

Q Have any of the contributors to Spitz Channell 's 
organizations ever met with the President prior to your 
involvement? 

A I have been told yes . 

Q Who? 

A I have been told that it happened, and I think the 
only one that comes to mind was maybe Barbara Newington. You 
know, I was told that it had taken place because that is a 
question that I did ask. Well, I know you've had briefings, 
has this ever happened? I was told yes . And as an example I 
believe it was Barbara Newington who had a photo ops. 

Q Prior to the arrangement that they made with you, 
had the President ever stopped by any of the briefings for 

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ACT or NEPL? 

A According to the paperwork I saw, no. Because the 
briefings were all in the EOB, and that didn't happen. 

Q When Marty Artiano talked to you initially about 
this arrangement, did he tell you they wanted you to arrange 
meeting with the President? 

A No . No . 

■Q He did not mention it? 

A No. It was not mentioned at all ion our initial 
discussions with this client. 

Q Was it mentioned at a later time? 

A Yes. 

Q Whan and in what context? 

A Well, it was in our subsequent discussion. Once, 
we know, we started checking out the group, and then they 
started asking for, you know, would it be possible to do a 
briefing? And we went through that and got the briefing. 

Well, would it be possible to go and have some of 
our contributors have photos, people who hadn't met the 
President before? And we checked into it and, yes. So it 
was not all at once, but it was over time that initial 
projects and requests came up. 

Q Was there a time in January of 1985 that it was 
indicated to you that Admiral Poindexter did not want to 
attend this meeting, or did not want it to take place in any 



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way? 



UNCLASSIFIED 



A January of '86 you mean? 

Q I mean January of '86. Excuse me. 

A No. Again, because once I put the request in, it 

»«. 
then became a White Hose matter and they decided who was 
n 

going to be there. 

And the briefing memo that was recommended was just 
a format that had been followed before. In fact, I don't 
think Poindexter did participate. 

Q Other than the meeting that you had with the 
President in the hallway prior to his entry in the Roosevelt 
Room on January 30, 1986, did you ever meet with the President 
or discuss with the President any of your activities related 
to IBC or Spitz Channell? 

A There had to be some kind of discussion once 
because I accompanied some of these people in for their photo 
ops . So I mean in that context he knew that I had a relation- 
ship and knew that these people were helping on the TV 
cooBercials . So I would have to say, you know, yes in that 
context. 

And in fact he, you know, he knew that I had 
provided, and matter of fact we saw some of the commercials, 
Fred Sacher, the Vice President, Ronald Reagan and I watched 
a couple of commercials, some of the new commercials that 



came out. 



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Q When did you do that? 

A Whenever it was in the calendar, when Fred Sacher 
went in for his photo, and we took a couple of minutes and 
had a television in the study there and watched a couple of 
the commercials. 

Q Was Mr. Sacher present? 

A That's correct. 

Q And the Vice President and you? And Don Regan, was 
he there too? • -. 

A I think Don Regan was present . 

Q Was anyone else present? 

A Jim Kuhn, the Aide to the President, was there. 
MR. McGOUGH; Could I interject? 

You said in the study. Where do you mean by that? 
THE WITNESS: He had the Oval Office, and then you 
go in a little hallway and there's the bathroom and a little 
tiny study. And it used to be Mike Deavers' office. It's 
just a place where he has a lunch and where, if he wants to 
go to a smaller office to have an informal meeting, or watch 
a new broadcast or something, the television is in there. 
BY MR. OLIVER: 

Q How long did that meeting take place with Fred 
Sacher? 

A About 10 minutes maybe because we watched some of 
the commercials- 




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Q And what was the date of that meeting, do you 
remember? 

A I want to say it was sometime after the January 
30th briefing. 

Q Shortly thereafter? 

A Yes. I'd say, you know, probably February sometime. 

Q Which commercials were these? 

A You know, I don't have any idea. 

Q Did the President comment on them to Mr. Sacher? 

A You know, as best I recall, they were impressed 
with them- Again, the only thing I can tell you is I don't 
remember anyone saying negative things about the President, 
as I recall. He was most impressed. And again had seen some 
of the commercials before the January 30th briefing. 
Commercials had been sent and he had seen them. 

Q Did the Vice President say anything or Mr. Sacher? 

A No. I just remember it as being very nice and kind 
of thinking, well, that's great of you to start this programs, 
and these ads are wonderful. And, you know, it was all just 
very positive, that kind of casual conversation. 

Q Was there a discussion about the briefing that had 
occurred on the 30th? 

A No, I don't recall that at all. 

Q Was it mentioned? 

A I don't believe so. But, you know, again it may 

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The only thing I remember is the TV commercials 
were looked at, there were thank you extended to him, and 
what a great job, and that was as much as I can recall. 

Q To your knowledge, has anybody else ever done these 
photo ops for people who have supported the President's 
program in Central America besides the ones that you arranged? 

A Besides the ones that I arranged? 

Q Yes. 

A I couldn't speak to that. I wouldn't know. I can 
only assume that — I mean when I was there for four years, 
you did photo ops all the time to thank people for a wide 
range of things that they had done for the President. 
You also did photo ops that the Congressmen 
requested, there was Congressional photo op time where a 
Congressman could bring in Miss Honey Bee or whatever here — 
that kind of thing. The photo ops were regularly scheduled. 

But as to whether or not any one of this issue, I 
have no personal knowledge. 

Q Prior to these photo ops that you arranged for Mr. 
Sacher and Mr. and Mrs. w»rm and Bill O'Neill, Mrs. Garwood, 
Barbara Newington, Bunker Hunt and the Driscolls, did you 
have meetings prior to any of those photo opportunities with 
Fred Fielding or anyone in his office? 

A No. 



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Q Were these things cleared through the Counsel's 
office? 

A I would not know. I know that they were cleared 
with the Chief of Staff and that is the gentleman that I 
specifically mentioned these to and got permission. 

Q To Don Regan? 

A To Don Reagan directly. 

Q And he was aware that you were being compensated? 

A Or that this was a client matter, and, you know, I 
had the discussion with him in January, and we again had 
subsequent meetings in his office on a wide range of issues. 
But he absolutely knew that this was client matter. 

Q So you knew that in effect he cleared how many 
meetings at your request? You count the January 30th 
meeting, then you have these one, two, three, four, five, 
six, seven photo opportunities. 

In addition to that, were there any other meetings 
that you cleared? 

A Well, the SDI one was on the boards. But then that 
got canceled. So, you know, the SDI briefing had been 
approved . 

Q By Mr. Regan? 

A By Mr. Regan's office at least. 

Q Were any objections ever raised to the SDI meeting 
by anyone in the White House to your knowledge? 



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A Other than what I've told you before is that 
originally it had been completely signed off on, and it was 
when Channell's organizations sent out their own telegrams in 
advance of the White House doing something. And that caused 
a cancellation, or we postponed it, because later on the 
proposal was in again. 

Q Do you have a copy of those telegrams that were 
sent out? 

A I don't, but I guarantee that Counsel's office did, 
or at least they did at the time because they showed them to 
me. 

Q Was there something in the text of the telegram 
that caused them to flag it? 

A Well, no. I think it was primarily the fellow who 
received it. He was a defense contractor. And they were 
worried that even though before this they had already said 
there was no problem as long as there was a mix, you can have 
dttfehse contractors there but it's got to be a well-rounded 
mix group. 

And then, all of a sudden, when this telegram came. 
Counsel's office now was saying, my God, someone from the 
defense industry has been invited to this, we cancel it. 

So, to my recollection, that was the one thing that 
cancelled it, and I don't think they liked the text anyway, 
because the White House likes to invite people themselves to 

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go on briefings - 

Q Did you know that Spitz Channell's organization 
and/or Rich Miller were specifically trying to get a list of 
the defense contractors who supported the President's SDI 
program? 

A No, they already — I think they had it in their 
research they were doing. I mean, there were articles being 
written at the time about who got what chunk of the SDI 
budget. I mean, that was well-)cnown and was — you know--and I 
believe there were even documents showing this company does 
this much business, they do this, and it was lists. 

Q They had those docxaments? 

A I saw it in articles myself in the media. 

Q Were there ever any discussions of those articles, 
or those lists, with Rich Miller or Spitz Channell? 

A About? 

Q In relation to the SDI briefing that you were 
attempting to arrange at the White House? 

A Oh, yes. What had been raised with me — and that's 
why I asked the Counsel's Office about it — was the fact that 
aside from the usual kind of contributors they wanted to 
invite,, they wanted to invite some people from the defense 
industry. I went into Wallison's office and raised the 
issue, saying I don't — I was the one that said I didn't think 
it was proper. They assured me that it wasn't, as long as 



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there was a mix, and so they said no, there's no problem, and 
I reported it back — nope — he says there's no problem. 

And in fact when the first telegram was received and 
it got into the Counsel's Office, they did an about-face and 
said can't do this. 

Q Did the contractor who got the telegram object to 
something that was said in the telegram? 

A No. I got the impression that it was somebody that 
Peter Wallison knew, and the guy was just sending it to Peter 
to say, look, do you know this is going on, just as a friend. 

Q Do you know what company that person was associated 
with? 

A No. I don't. 

Q You don't remember? 

A No. I don't. 

Q Well, was it your understanding that this particular 
contractor was offended by the fact that he might be asked to 
contribute money to Spitz Channell's organization? 

A No. You know, again, I read it in the context. 
I'm sure he had the same reaction I did, when Channell asked, 
and Miller asked me, can we invite defense contractors. My 
first reaction was no, don't do it. But I went into the 
White House Counsel's Office and asked permission--is this 
proper? — and they said yes, as long as it's a mixed bag of 
people. And so they went ahead and did it. I didn't-- 



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Q Did you tell Channell that, or Miller that? 

A I reported back to somebody, look, there's no 
problem with this as long as we do a mix, don't have — you 
know — put in a portion of defense contractors, but it's got to 
be a mix of people. 

Q So the White House Counsel had told you it was 
okay, and you told them it was okay? 

A That ' s right . But what got them in trouble was , 
Channell went ahead and sent out his own telegram without 
talking to me about it. I don't know if he talked to Miller 
but he never told me, or — 

Q What difference does that make, if the telegram 
went to a mix? 

A Because you had a private group inviting people to 
the White House . The White House is supposed to invite 
people to the white House. 

Q But you were arranging meeting for Spitz Channell 's 
people. You're a private individual. 

A No, no, but now the difference is — 

Q Channell 's a private organization. 

A No, you're missing the point. 

Q These are private individuals. 

A Now the difference is that what I did is I proposed 
briefings, and I went through the system in the White House. 
I went to the right people and said here is a proposal. They 

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then took it and put it through their system, and all of the 
offices that have to agree to this would agree to it. 

And in this case, in the SDI, it been signed off, 
and it's till the system went off-base a little bit that it 
got cancelled. But the White House is the one, whether it's 
Public Liaison Office, or the Office of Science and Technol- 
ogy, someone is supposed to originate the invitation, not an 
outside group. 

It's okay for a group to follow up, but the first 
time a person hears about a briefing should not be from a 
private group, saying, you are hereby invited to the White 
House, and, please — you know — come to the gate at this time. 
That has to come from the White House. 

Q But the idea for the meeting, the briefings in the 
White House, came from you and came from Spitz Channell, isn't 
that right? 

A Sure. Oh, yes. Absolutely. 

Q And the list was provided by you and Spitz Channell 
to the White House? 

A Yes. Now I never gave a list on the SDI briefing. 

Q But you did give a list on the other briefing? 

A Absolutely. Yes. 

Q But you were prepared to give a list on the SDI 
briefing? 

A Yes. You know, it was just — I wanted to go clear 



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up the matter on whether or not you could invite defense 

contractors . 

Q And you did do that, and what's confusing to me is 

that the only issue that seemed to have been raised by the 

Counsel was whether or not there was a mix of people. Yet 

the meting was cancelled because these people got a telegram 
A 

saying they were going to be invited to the White House. I 
mean, it sounds like "apples and oranges" to me. 

A No, listen. First of all, it was very distressing 
to me to have them say one day it's okay, and then, you know, 
a month later, all of a sudden day you can't invite defense 
contractors, is basically what they told me. They did an 
about face, but I think they did it because they were angered 
that Channell's group sent out telegrams ahead of time, 
before the White House officially notified those people 
themselves, and that, to them, was enough to cancel it. 

Q Were you aware that Spitz Channell's organization 
was going to contact the people who were on their list? 

A Not ahead of time. No. I did not. 

Q Who compiled the list? 

A I can assume that Channell did. 

Q Well, was the purpose of this exercise to get these 
people to contribute to the television advertising campaign 
that they were going to do? 

A Sure. Sure. Absolutely. 



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Q Well, if the President wasn't going to ask them for 
money, how did you expect them to learn that they were about 
to be solicited if they weren't contacted by Spitz Channell? 

A Because contact, after you're invited by the White 
House, a group then can do all the contact — I mean, can do 
the contacting if they want, or they can have meetings after 
the White House meeting. 

But for a private group, that the first contact you 
would have as an invitee of the White House is from some 
private group, that is not proper, and that's what got them 
in trouble. 

Q Do you know if any of the 19 people who were 
invited to the white House on January 3rd of 1986 were 
contacted by the White House before they were contacted by 
Spitz Channell? 

A That one, I don't know how it was done. I'd have no 
idea how — who invited who. First, I wasn't involved in that, 
nor was the issue ever raised with me. No one ever said, do 
you know that this telegram went out, or this? That was 
never raised with me. There were no hitches or problems with 
the January 30th briefing. 

Q Well, the people who were invited were people who 
had already been developed as contributors by Spitz Channell. 

A Or additional. I mean, I don't know how- -you know- 
-the list was more than I think nineteen. There were a lot 

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of people who were invited to the January 30th, and he was 
always updating his list, and figuring out who he was going 
to invite to the next briefing. It was an ever-evolving list 
of people. 

Q Did you know that they were going to solicit these 
people for contributions at the Hay-Adams Hotel later that 
night after the briefing? 

A In the January 30th? 

Q -January 30th. 

A I didn't know what they were going to do at the 
January 30th briefing. I certainly knew that these people 
had given money to the program. You know, how he did it, or 
whether he was going to solicit at the Adams, I — 

Q You didn't know that they were going to be asked to 
contribute money after the briefing? 

A At that briefing? I didn't — 

Q After the briefing, at the Hay-Adams. 

A I did not know that. 

Q You did not know. 

A But I would assume that that's — 

Q Were you aware that they did contribute? 

A That people did contribute? 

Q Yes . 

A Yes, because I saw lists where, you know, the 
people that ended up getting private photo jsps, it listed the 

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kinds of things that — the amounts of money. 

Q How much money they had contributed? 

A Sure. 

Q It was an impressive amount of money, wasn't it? 

A And it's not only that. And it was always touted 
as a meeting of the people who had contributed, and the 
purpose of this was to thank them, and encourage them to 
continue supporting the President. 

Q Were you aware that after the meeting at the White 
House, where the President appeared, that 16 of the 19 
potential contributors who were there that night contributed 
over $4 million in the next five months to Spitz Channell's 
organization? 

A I wouldn't know, you know, who gave what. 

Q You were never informed of whether or not this was 
a successful event? 

A Oh, yes, everyone was very pleased with >Iit, and I 
knew that they were able to--you know--hit some of their 
goals, as was put in the memo, that they were hoping to raise 
another — I don't know how many millions — for their public- 
education program. I mean, they obviously were achieving it 
because they continued to produce ads and put more on. 

Q Would you say that Spitz Channell was basically a 
fundraiser? 

A He was a fundraiser, but he also took that money 

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and produced — I don't know if you want to call it--l don't 
know how you describe someone who tries to put on public- 
education programs, whether that's one who tries to influence 
public opinion, or to sway public opinion. I mean, he was 
certainly both of those. 

He couldn't have done the second without raising 
the money. I mean, the money was the vehicle in order to 
allow him to produce commercials. 

Q Well, you said that you had checked him out Before 
you finalized — 

A As best I could, yes. 

Q As best you could. Well, were you told what his 
background was? 

A No. The only thing that I could find out in going 
into the White House was that — my impression was people 
didn't know him very well, but they certainly knew the 
product, and I could show storyboards, and, oh, yeah, I've 
seen that commercial, or, oh, yes, they're doing great work. 

Q Did you know he had been the finance chairman for 
NCPAC? 

A I found that out at some point, yes. I mean, when 
I did, I don't know. 

Q What I'm trying to determine, Mr. Fischer, is, is 
it your conception that Spitz Channell is anything other than 
primarily in the fundraising business? 



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A No, I don't — he was many things, but, you know, he 
certainly had--first he created programs that people wanted 
to support, so that's the first thing that he did, and he was 
very smart. He turned out to be a fellow who, like other 
organizations in town, would find issues which they would 
stand for. 

He chose to take issues that were in support of 
Administration policy, and those were very easy to support 
for him, and it was very easy for him, then, to go to con- 
tributors and say, look, I'm trying to help the President on 
arms control, on SDI, on support the President in Central 
America. 

And so he had to create the programs, first. He 
had to create the vehicle. Once he created the vehicle — and 
he was very good at that — then it was — he obviously did it 
easily because he was able to go and get people to support 
it. And in some cases you had people like Fred Sacher who 
got the credit for coming up with the Central American 
program. That's what I was told, that it was his idea, not 
Channell's, but Channell put it together. 

Q So it isn't your impression that he was doing this 
to make money. He was doing this for altruistic reasons, is 
that what you're saying? 

A I can't tell you what his motivation — what I think, 
ultimately, what Spitz Channell wanted? I think when it was 



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all said and done, that Channell wanted to be a man of 
influence in Washington, so that if Ted Koppel on "Nightline" 
wanted to have an expert on influencing public opinion, that 
they wouldn't necessarily go to Richard Viguerie anymore. 
They would say, you know, this Channell 's the guy who's been 
doing this ad, and all of a sudden you'd seen Channell on 
television, and he would be the one that people would be 
mentioning and writing about. 

So he was doing all of these things and never" 
getting any credit for it. That's why I think, ultimately, 
he~ 

Q Well, he's well-known now. 

A No, but I think, ultimately, that's kind of what he 
wanted. He may have been in it for the money. I don't know 
what he made on it, but I sincerely believe that he really 
wanted to help the President. 

Q But you were in it for the money? 

A He was certainly a client, I wasn't doing it for 
free. 

Q Had you ever been paid that much money before in 
your life? 

A In one year? Absolutely not. I've been offered 
more, as I told you the other examples. Just before I met 
Channell, I was offered a lot more money. 

Q So this was practically a doubling of your income. 



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wasn't it, this arrangement with IBC? 

A I would say from '85 over to '86, that that's — you 
know — that's probably about right. I'd have to review the 
taxes, but I'm sure that's correct. But that was going from 
a salaried employee to self-employed. 

Q Did you discuss with Rich Miller, at any point, 
difficulties that he was having with the Channell arrangement 
in August of 1986, or thereabouts? 

A I know there wds a time, and I think it had to do 
with SDI , in which there were some hitches . There had been a 
lot of money expended, I believe, on a big writing project, 
and research, and other people had been brought in to assist 
in putting together this big SDI package, and Spitz was now 
starting to veer away, and it appeared to him that the 
Administration no longer considered this a big, important 
item, and so he was thinking about other things. So I think 
that was happening about that time. 

Q But did they terminate their arrangement in August 
of 1986 for a period of time? 

A I don't know. There was a time when there was — I 
think a couple months — where — I don't know if you'd call it a 
hiatus, or whatever it was — in which there were no specific 
programs that Channell wanted Miller to work on. I think 
that's correct. I don't know if it was a month or two months. 

Q Did you continue to be paid your monthly fee 



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throughout this period? 

A Yes. 

Q And Mr. Artiano continued to be paid throughout 
this period? 

A I can only assume that. I don't know for sure, you 
know, what was happening with Marty, but I believe he was. 

Q Do you know what the circumstances were under which 
Lynn Nofziger was brought in as a client of IBC? 

A One of the things that Channel 1 would ask me, 
occasionally, is — he always was looking for new people to 
assist him, and I know Pete Hannaford. He asked me about Pete 
Hannaford at one time. He talked about Nofziger. And those 
are the two that stick my mind. 

And I said, you know, obviously they're well-known 
people, Nofziger more than Hannaford, and depending on what 
you want them for, they'd be good quality people to be 
associated with. 

Q So you recommended Nofziger to Spitz? 

A He asked me what do you think of Nofziger, and I 
said, you know, he'd be good for — you know--depending on what 
you're looking for, he would be a good man to have on board 
with you, as X did with Pete Hannaford. 

Q So Spitz retained Lynji Nofziger? 

A I believe he did, from what I read in the newspa- 



pers . 



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Q Was Rich Miller involved in that? 

A With Nofziger? 

Q Yes. 

A I don't know. We had meetings, occasionally, with 
Nofziger, Channell, Miller and I. 

Q What was . the purpose of those meetings? 

A Lynn, as I remember, /^c/me on very late in 1986, and 
I think some of it had to do with strategy on where he was 
going. I remember one — and the reason I remember it was 
because it was a disturbing Issue to Channell. This is like 
late — I don't know if this is December or November of'86. 

Whenever there were some initial stories about the 
Channell organization, and this girl that was a former 
employee-- 

Q Jane McLaughlin? 

A Jane McLaughlin, and somebody else. Quayle? Linda 
Guell. 

Q Linda Guell. 

A Linda Guell. I was told by either Miller or 
Channell, or both at the same time, but it all led up to a 
meeting with Nofziger in which it was alleged — and I don't 
have any firsthand knowledge — that those girls, one or both 
of them, had asked Channell for $200,000 to set up their own 
PR firm. They were somehow tied in with Western Goals, or 
some organization that they had worked for before, that 

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Channell took over. 

But it was kind of alleged by the people telling us, 
that this was kind of either, "Give us the money or we're 
going to go public with some documents." And I just remember 
having a meeting in Lymi's office in which this was all 
discussed openly, and it was my opinion at the time — and I 
expressed it very vocally — if anyone's doing that, talk to 
your lawyer, and if he thinks there's a problem, go to the 
authorities with it. 

If somebody's trying to do that — you know — if 
that's in fact what's happening. And that's as much as I 
remember. And Lyn^ was outraged by it, and said, if that's 
true, get ahold of your lawyer and he'll tell you what to do 
about it . 

Q Why was Nofziger brought in for that kind of advice? 

A No, I'm just saying that Lyn/r--and we may have 
talked about other things. It's just that, you know, when 
you're trying to recall something, something unusual has to 
happen in a meeting for it to come to your attention. I 
remember that specific one just because it's a pretty unusual 
thing to be talking about. 

Q Was Nofziger paid directly by Spitz, or was he paid 
through IBC7 

A I believe it was direct from Channell --and, again, 
I'm getting this from whatever I've read in the papers. 



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Q But you would have known had it come from IBC, 
because by that time 

A No, I wouldn't have known even then, because I 
never saw the IBC books; I don't know what was coming into 
IBC, and I don't know what was going out or who they had 
under consultancy. 

Q By the fall of 1986, you had already entered into 
this new joint venture with IBC where you had discussed the 
structuring of who was whose clients and what were holdovers 
and so on. 

A Yes . 

Q Nofziger apparently was paid thousands of dollars 
in September and October 

A 20,000 a month. 

Q of 1986. And my question is, whose client was 

he? 

A I think he was Channell's. But, again, even if he 

had been paid 

MR. WORK: "Client" isn't the right word. 

THE WITNESS: No, he was a consultant to Channel 1. 

BY MR. OLIVER: 

Q Employee, consultant, whatever. 

A As I've said before, I don't know — Miller was the 
managing partner of IBC; I don't know how he invoiced, I 
never saw the books of IBC. So he could have been. I mean. 



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I read in the paper that it was — and it was my impression — 
that it was a direct relationship between Channell and 
Nofziger. But I don't know that for a fact. But I believe 
that's the case- 

Q Do you know what Nofziger was supposed to do for 
this $20,000 a month? 

A I don't. 

Q You have no idea? 

A NO. 

Q But you were participating in this meeting after 
the Channell 

A There were a couple of meetings that we had with 
Lynn, but, you know, the only thing that really sticks in my 
mind was that particular issue, and I am not saying that the 
meeting was called for that, but 

Q That would have been January of this year? 

A Or it could have been — whenever the story broke, I 
can't recall when it was. It could have been December of 
'86, it could have been January of '87 — I just don't know 
when it was. I just know that whenever that whole issue came 
up, that it was a subject discussed with Nofziger; X mean, I 
remember sitting right in his office when they talked about 
it. I know what my reaction was to it. 

Q Did IBC or David Fischer Associates, to your 
knowledge, have a PAC, a political action committee? 



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A Well, I sure don't, and I don't believe IBC — at 
least I've never heard of one. But I also didn't hear of 
other things that were 

Q Were you on the board or involved in any PAC's in 
any way in 1986? 

A No, sir. 

Q You indicated that Jonathan Miller was the one who 
requested you to give your pass back. Did you know Jonathan 
Miller? 

A You just made me think of something. I sit on the 
finance committee for Bush's PAC, so I just remembered I do 
officially sit on that. 

Q How long have you been? 

A Gee, right after he formed it, I was asked, I was 
one of hundreds of people. I was the representative from 
Utah. But that's the only one that I've ever been affiliated 
with. 

Q Let's go back to Jonathan Miller. He requested 
that you give your White House pass back? 

A Yes. 

Q When was that? 

A October or November of 1986. 

Q Was that in connection with a blanket recall on all 
of them? 

A Yes, I was told that they were recalling any 



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outstanding passes. 

Q Did he give you a reason why they were doing that? 

A No, but, if I recall, there was something about 
Nofziger at that time had just gotten in trouble. But I was 
just called and they said bring the pass in, and then 
Jonathan and I had breakfast in the White House. 

Q How long have you known Jonathan? 

A I don't think I really — I think I had met Jonathan, 
but I don't think I really got to ever know him until he took 
over from John Rogers as the administrative guy at the White 
House. He had left NSC as staff secretary — I think that's 
what he was — and went over to run the White House complex, 
and I believe that's where I first got to know him. I mean, 
I kind of knew who he was because of his activities at NSC. 

Q What did you know about his activities at NSC? 

A Just that I believe he was staff secretary, and 
that's about as much as I knew. 

Q How did you know that? 

A I don't even know if he was staff secretary when I 
was there. I'm having a hard time figuring out when I knew 
people. 

Q Well, the reason I asked the question is because 
you left the White House in April of 1985. 

A I may have gotten to know Jonathan after that, I 



just don't know. 



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Q Mr. Miller was not at the White House when you 
left, he didn't return until later. So my question was when 
did you get to know him? 

A Again I believe it was when he was the administra- 
tive officer under Don Regan. 

Q Did you know that he was involved with Rich Miller 
and Frank Gomez? 

A Rich Miller at some point during my relationship 
with Rich and Frank said that they knew him, and that he had 
somehow — again, I am getting some of this from the papers — 
that he had worked at an office in the State Department that 
had responsibility for like public diplomacy, or something, 
and that is how they had known Rich Miller and Frank had 
known Jonathan Miller. 

Q Did you get to know Jonathan Miller through them? 

A No, I don't think so. I recall knowing him because 
of my being in the White House, and that when he took over 
froni--it was John Rogers, another Regan guy, and that guy 
want to Agriculture Department, and when he took over I think 
that's the first time I ever sat down and had a meeting with 
him. I mean, I never remember having a meeting with him 
outside the White House; he was never at IBC. I just recall 
meeting with him in his office in the basement of the West 
Wing. 

Q After you had left the White House? 



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A Correct. And that was in the admin office when he 
took over that job. 

Q why would you have been meeting with him if you 
didn't know him? 

A Just because he had that position and I was 
frequently in there and met with Regan's staff on a very 
regular basis, and he was one of Regan's guys. 

Q Did you tell him at that time that you were working 
for IBC? ■ -. 

A I can't recall, I just don't know. 

Q Was there any discussion 

A I mean, there wouldn't be a reason to be talking to 
him because his responsibilities had to do with the physical 
maintenance of a building, and he was basically admin officer. 

Q But he also controlled White House passes. 

A He did that, because he called and asked for mine 
back. But I had already had mine at this time. 

Q How often are they issued? 

A I think when we got ours in 1981 that there was not 
a new one issued until 

Q So it wasn't an annual thing. 

A Oh, no, I think it's like every three or four — it's 
whenever Secret Service — it's a Secret Service decision, 
whenever they decide it's time for security reasons to change 
the pass system, they do it. And they've gone to these--I 



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can't think of the holograms where they have that little 
funny stripe that turns--and they did that so people couldn't 
fabricate fake passes. 

Q Do you have a White House pass now? 

A No, sir. 

Q Do you have access to the White House? 

A Only like any other citizen where someone has to 
clear you. 

Q You are not on a list or something? 

A Not that I eun aware of. 

7 

Q Of people who are cleared. 

A Maybe on a different kind of list right now, a do- 
not-admit list — no, I don't even know if there are those 
kinds of list. The only way that I can get into the White 
House is like anyone else: you have to have someone call 
Secret Service and say this person will be at this gate, 
here's the Social Security number, date of birth, and would 
you please clear him. 

Q You indicated a few moments ago that you met with 
Regan's people frequently. 

A Correct. 

Q What was the purpose of your meeting with these 
people? 

A The primary contact I had was with David Chew, who 
was staff secretary. David and I had started a relationship. 



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and a very good one, when he was working for Don Regan as 
Secretary of the Treasury, and David would frequently call me 
over to sit down, particularly at the end of the day, and sit 
and talk about things that were going on at the White House, 
concerns that they had, how — they particularly wanted 
feedback, particularly from the western states; how's Reagan 
doing, how is Don Regan doing, what are you hearing out 
there, we have this problem in this area, how would you 
handle it, can you give us recommendations on this — and a lot 
of it was they wanted feedback, I think, from a guy that they 
liked, a former Ronald Reagan guy who had been around for 
awhile, but yet was respected by Don Regan and them. And so 
I was viewed, I think, as a valuable source of feedback for 
them. 

Q Were these people aware that you were being 
compensated by the people for whom you were arranging those 
meetings? 

A Oh, sure, David Chew did and Don Regan did, yes. 

Q Anyone else on Don Regan's staff? 

A You know, I don't know, they may have. 

Q What about Fred Ryan, did he know you were being 
compensated? 

A I believe Fred did, too. 

Q And Fred Fielding knew you were being compensated? 



A Yes. 



UNCLASSIFIED 



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Q And Peter Wallison knew you were being compensated? 

A Yes. 

Q And did you say Bill Hauser? 

A Well, Dick Hauser 

Q Dick Hauser. 

A I believe Dick Hauser may have been in on a 
meeting, so I believe he did. 

Q He knew you were being compensated. 

A I believe, I'm not too sure on Dick Hauser. 

Q Did Linas Kojelis know you were being compensated? 

A That I can't speak to; I mean, he was far enough 
down the ladder, I'm not so sure that that would have been a 
subject to discuss. I may have, but I just don't know. I 
doubt it . 

Q Did Elliott Abrams know that you were being 
compensated? 

A Only if Marty had told him. That's not the kind of 
thing I would have talked to him; we didn't have any kind of 
a social relationship. And my meeting with him was only 
those two--as I recall, were only those two occasions. 

Q Did he wonder why you were there in January of 1986? 

A Well, Marty is the one that set the meeting up. I 
don't know what Marty said to him, but knowing Marty I am 
sure he told him it was a client matter. 

Q Did you participate in the discussion at all at 

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that meeting with Elliott Abrams? 

A I wouldn't call it a discussion; it was more a 
lecture or a monologue by Channell telling Elliott Abreuns 
everything that was doing. When Spitz is in a room, he 
dominates it. I recall him just doing most of the talking. 
Q But he was aware at that time that you and Marty 
Artiano had a relationship with IBC and with Channell? 

A I would say that he had to, but what Marty told him 
I don't know. But knowing as careful as Marty is, I am sure 
he told Elliott that it was a business relationship and that 
it was a client matter, because Marty was always the one that 
insisted to me that, even though I would have done it anyway, 
be sure and tell Don Regan this is a client matter. And I 
can only suppose what he said. 

Q I have no further questions, Mr. Fischer, thank you 
very much for your patience. 

MR. WORK: Can I put one other thing on the record? 
W« can go off the record while you decide whether I can or 
not. 

MR. OLIVER: We'll go off the record. 
[Brief discussion off the record] 

EXAMINATION BY COUNSEL FOR THE 
WITNESS 
BY MR. WORK: 
Q Mr. Fischer, would you describe, please, your very 



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first meeting with the independent counsel, tell us whether 
you had immunity at that time and what you did when you went 
to meet with him. 

A I believe the first encounter with the independent 
counsel was in March of--I believe it was March of 1987. And 
it was a result of my request to meet with them to describe 
everything that I knew about it, and the reason for that was 
the people that I had been associated with were in the 
process of being investigated or subpoenaed, or whatever was 
going on at the time, and I just felt a real desire to go up 
there before any of that happened to me and fully explain my 
relationship to the parties involved and exactly what I knew. 
And I went up there. Even though the response from the 
attorneys was they didn't want to meet, didn't think it was 
necessary, we continued to insist, and in fact that led to a 
meeting in which I fully described the relationship with all 
of the principals involved — with no immunity. 

Q And you told this whole story that you have been 
telling here today, is that right? 

A Yes. 

MR. WORK: Thank you very much for letting me put 
that on the record. 

MR. OLIVER: I would like to ask just a couple of 
more. 

FURTHER EXAMINATION BY COUNSEL FOR 



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THE HOUSE SELECT COMMITTEE 
BY MR- OLIVER: 

Q Have you discussed your deposition here today with 
any of the individuals who were mentioned today other than 
your lawyer? 

A I told--Marty, of course, knew that I was going to 
have a deposition, as I knew he was having one. And I 
informed Rich Miller that I was going to have one. 

Q Did you discuss with them questions that might be 
asked of you or questions that might have been asked of them? 

A No; I did ask Marty how it went, and he said fine. 
It was a very general discussion; you know, they ask all the 
questions you would expect. The only thing that he did 
volunteer — and it was the only thing — was that there was a 
lengthy inquiry into his background and basically his 
qualifications to be someone involved in public relations. 
And that's as much as he told me. And he said that it was 
long, longer than he thought it was going to be. 

Q He didn't tell you what questions had been asked 
other than that? 

A No. 

Q You didn't discuss any of the answers that he migh' 



give. 



No. 



UNCLASSIFIED 



oiUrS d) 



And other than Marty and Rich, there are no o' 



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whose names have been mentioned today that you discussed 

A No — other than my wife. 

Q Have you discussed your testimony here or your ■ 
involvement in this matter with any members or staff on this 
committee other than the people who have been here today? 

A No, sir. 

Q Not directly or indirectly? 

A No. 

Q Thank you, Mr. Fischer. 

[Whereupon, at 6:20 p.m., the taking of the 
deposition in the above-entitled matter concluded] 



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REPORTER 



I, Terry Barham, the officer before whom the 
foregoing deposition was taken, do hereby certify that the 
witness whose testimony appears in the foregoing transcript 
was duly sworn by me; that the testimony of said witness was 
taken by me and thereaftrer reduced to typewriting by me or 
under my supervision; that said deposition transcript is a 
true record of the testimony given by said witness; that I am 
neither counsel for, related to, nor employed by any of the 
parties to the action in which this deposition was taken.; 
and, further, that I am not a relative or employee of any 
attorney or counsel employed by the parties hereto, nor 
financially or otherwise interested in the outcome of the 
action. 




Terry Barham^,^«otary Public in 
and for theDistrict of Coluinbia 



My comnission expires May 15, 1989. 



^'^OUSSIHEB 



477 



mmm 



UNITED STATES SENATE 

SELECT COMMITTEE ON SECRET MILITARY ASSISTANCE TO IRAN 

AND THE NICARAGUAN OPPOSITION 



In the Matter of the Oral Deposition of: 
EMANUEL A. FLOOR 



BE IT REMEMBERED that on the 8th day of June, 1987 
commencing at the hour of 2:00 p.m., the deposition of EMANUEJL 
A. FLOOR, produced as a witness at the instance and request of 
the Associate Counsel, in the above-entitled action, was taken 

before RASHELL GARCIA, a Certified Shorthand Reporter and | 

I 
Notary Public in and for the State of Utah, at the offices of 

the U.S. Attorney's office, 350 South Main, Fourth Floor, Salt 

Lake City, Utaih; and 

That the deposition was taken pursuant to Subpoena 



ORIGINAL 




ioeo 




■daaHM/tplniillow^ 



RASHELL GARCIA 

CSR No. 144 



'P. 



-O.- 



INDEPENDENT REPORTING 
SERVICE 

Certified Shonhand Reporters 



under pfovtaiom of LO. 123: 
bf O. SMm, hUlioMl SecuHty Co 



St 




1200 Beneficial Life Tower 
36 Souih State Street 

Salt Lake Citv. Utah 84Tt1 
(801) 538-2333 



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APPEARANCES 



For the United States 
Senate Select Committee on 
Secret Military Assistance 
to Iran and the Nicaraguan 
Opposition: 



For the Witness; 



Richard Parry 

Associate Counsel 

901 Hart Senate Office Building 

Washington, D-C. 20510 



Robert D. Radcliffe 
Attorney at Law 
463 East 200 South 
Salt Lake City, Utah 



I y E X 

The Witness 

EMANUEL A. FLOOR 

Exaunination by Mr. Parry 
Examination by Mr. Radcliffe 
Further Examination by Mr. Parry 



Pace 



66 
71 



«\>SS\?0 



Rashell Garcia • C«nHiad Shorthand Reporter • 



479 



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EXHIBITS 
iit,uafefij: Description Page 



2 1 Copy of magazine article pertaining to 

Adnan Khashoggi 10 

^ 2 Copy of draft of Stock Purchase Agreement 14 

3 Series of agreements with routing slip 
attached (29 pages) 15 

4 Copy of sketch drawn by Adnan Khashoggi 
to illustrate arms transaction 29 

5 Copy of a telefax sent from Parsons, Behle 

^ & Latimer to the office of the witness 4 

6 Photocopy of business cards 48 
g 7 Photocopy of handwritten notes made by 

the witness 48 

8 Photocopy of the witness's passport 53 

9 Copy of itinerary for trip to New York 
and subsequent trip to Cayman Islands 53 

10 Copy of guarantee to Vertex Finances S.A. 
dated 6th March, 1986 54 

11 Copy of acknowledgement 54 

12 Copy of acknowledgement 54 

13 Instructions to Euro Bank 54 

14 Copy of letter from Larry Taylor to 
Don Fraser dated January 3, 1986 55 

15 Telex to Robert Shaheen dated 
November 1, 1985 from the witness 55 

16 Docximent prepared by the witness entitled 
Vertex/Triad Relationship 56 



El^SS\® 



Rashell Garcia • Cartffled Shorthand Raponar - 



480 



Dtcl MiMi rt ^Rtl t ti td ow 




PROCEEDINGS 
TT^ftpTTTT. A. FLOOR. 

having first been duly and legally sworn to state 
the truth, the whole truth, and nothing but the 
truth, was examined and testified on his oath as 
follows: 

MR. PARRY: For the record, I would like to state 
that Mr. Emanuel Floor is here pursuant to a subpoena served 
by the United States Senate Select Committee on Secret 
Military Assistance to Iran and the Nicaraguan Opposition. 

Mr. Floor is represented by his attorney, 
Mr. Robert Radcliffe, and Mr. Radcliffe and I have agreed to 
stipulate that all objections except as to the form of the 
question can be reserved. 

MR. RADCLIFFE: Agreed and stipulated. 
EXAMINATION 
BY MR. PARRY; 



Q Mr. Floor, I'd like to just start with some basic 
background questions. 

Could you tell us your full name, where you were 
bom and your educational background, briefly. 

A My name is Emanuel A. Floor. I was bom in 
Salt Lake City, Utah, December 3rd, 1935 and have lived in 
Salt Lake City all of my life with the exception of two 
years in which I was in Logan, Utah. 




^ by O. Silfco, Nitioful Secu^i^/ Colt 



481 



urn 



Is Si- 



I was educated through the public school system of 
Salt Lake City graduating from West High School in 1953 and 
the University of Utah in June of 1957. 

Q All right. After graduation, what career field did 
you go into? 

A From 1957 and actually during college until 1964, I 
was involved in the advertising and public relations 
business. I worked for David Evems Advertising. I worked 
for the Salt Lake Tribune. I worked for KSL Television 
during that period. In 1964 — actually, probably early '65 — 
I went to the State of Utah and was the director of the Utah 
Travel Council for approximately two years and then in 1966, 
I went to Utah State University in Logan where I served as 
the director of institutional development. 

In 1968, I returned to Salt Lake City and cane back 
to the David Evans Advertising Agency. In '69, I went to 
work for Terracor and that's when I changed my career from 
the advertising/public relations field to the real estate 
field. 

In '69 through '72, perhaps '73, I was with 
Terracor in a variety of assignments, finance, development 
and marketing. And then I was an independent consultant in 
'73, '74, and on January 1 of '75, I became the executive 
vice-president of AK Utah Properties Incorporated, which was 
the Khashoggi company engaged in the development of the Salt 



iUOtmmi Sh'^thand Reporter - 




482 






Lake International Center. I was employed and associated 
with Mr. Khashoggi and the Triad companies through the end 
of 1986. Since late 1986, early this year, I've been 
associated with a piiblic company, Longhom Enterprises, 
Incorporated, which does business as Republic International 
Corporation, where I've been serving as a consultant and 
corporate officer. 

MR. RADCLIFFE: Excuse me, Mr. Floor. Before you 
go forward answering any more questions, please respond to 
the question. The question was: What career field did you 
go into after college. I didn't object prior because 
Counsel would have got this information anyway, but in the 
future, please respond to the question, don't anticipate^ 
Counsel ' s direction. 

THE WITKESS: Yes, sir. 

MR. RADCLIFFE: Thank you. 
Q (By Mr. Parry) Let's go back to when you first 
became associated with Adnan Khashoggi and AK Vtah 
Properties, I believe, in 1975. How did you come to meet 
Mr. Khashoggi? 

A In early October of '74, I was asked to look at the 
Salt Lake International Center project. I attended some 
meetings with Khashoggi representatives in late October. 
They offered me a position with the company in early 
December and I was hired by representatives of Mr. Khashoggi 



Reporter- 




483 



A^in? ^ 



w&m 



in December to start work January 1 of '75. 

Q Who were the representatives of Mr. Khashoggi that 
you first dealt with? 

A They were representatives of a company called Triad 
America Capital Management Incorporated, TACMI, and a 
company called TRACK, Triad America Capital Corporation. 
They had offices in the Los Altos/Palo Altos area of 
San Francisco. Mr. John McMaihan was the businessman heading 
it up. Mr. Morton McCloud was an attorney and there was 
some other attorneys that may not have been directly 
involved with the company but were representing 
Mr. Khashoggi, Mr. Thomas Childers and Mr. David Berrado, 
and they were the people I met with. There were others,^ but 
those were principally the people I met with in late '74. 

Q When did you first meet Mr. Khashoggi? 

A I met Adnan Khashoggi for the first time in early 
April of 1975 in Paris at his Paris condominium. 

Q And since that time, you've had numerous meetings 
with Mr. Khashoggi? 

A Yes, many. 

Q What was your position when you first came with the 
Khashoggi companies? 

A In January of '75, I was the executive vice 
president of AK Utah Properties and a member of the board of 
directors of AK Utah Properties. And that company was the 




Rastiotl Garcia • Certfled Shorthand Reponar - 



484 



wrosffe 



Salt Lake City based or the Utah based company that owned 
the International Center. In about April of '75, 
Mr. McMahan, who had been president of AX Utah Properties, 
resigned and I was elected president of AK Utah Properties 
and I have been — well, I've had a nxunber of positions with 
the Utah companies. By the time I resigned, I think I 
probably resigned from 50 or 60 posts, but, essentially, I 
was president of AK Utah Properties. Then I became 
executive vice president of Triad America, which was 
subsequently created, and I was the president of Triad 
Properties, which was the real estate company within the 
Triad group. 

Q You were never president of Triad America? 

A No, I was not. I was a member of the board of 
directors of Triad America from its inception until I 
resigned. 

Q And did Mr. Khashoggi control all of these 
companies? 

A Mr. Khashoggi was the majority shareholder of the 
parent Triad America and his brother, Essam Khashoggi, was 
the minority shareholder. There were just the two 
shareholders early on. And in the early days, the chairman 
of the board was a U.S. based but in, oh, about 1980, Essam 
Khashoggi became chairman and through these various people, 
Mr. Adnan Khashoggi controlled these companies. 



KUSSlFiti 



Rashell Garcia • C«rlfflad Shorthand Raporler ■ 



485 



ISIMIFI 



Q There's also a company called Triad International. 
What is its relationship to Triad America and the other 
companies? 

A Triad International is — well, there's actually a 
couple of companies that have that designation, one is Triad 
International Holding Company, a Cayman holding company 
which held the stock or may still hold the stock of Triad 
America and was owned by Mr. Adnan Khashoggi. There's also 
a company called Triad International Marketing, which is the 
name Mr. Khashoggi or others had given to his international 
marketing efforts. And there was also a Triad International 
that we organized in Utah but was never — we organized it as 
a company to preserve the name so other companies couldn^t 
use the name, but it was never operated as another name. 

Q Did you become responsible for or involved in most 
of the major financing for Triad America? 

A I was involved in the financing for the real estate 
portion of Triad America, yes. 

Q Was that primarily the properties in Utah? 

A That included the properties in Utah, which were a 
major factor, but it also included properties in Florida, 
Texas, California and Memphis, Tennessee, which were all 
part of the group at one tlm«. 

Q Where did— let's talk about the Utah project. 
Where did the initial financing for that project come from? 

U 5L.-? 



— Rashall Garcia • C 



C«ftlfled Shonnand Reporter • 



486 



.yNCLASSiri: 



A There were** ■wWfc.flWiS 'nij^ t.3 

Q And, again, in general terms. 

A There were three Utah real estate projects of some 
size. The initial project, the Salt Lake International 
Center, was financed — the acquisition was financed by funds 
made available through the Triad organization before I 
joined the firm. Following the time I joined the company, 
Mr. Khashoggi arranged for financing through Credit 
Commercial de France and Continental Illinois Bank for a 
$6 million dollar funding that funded it. Subsequent 
projects were funded primarily by equity investment by the 
Triad organization, Mr. Khashoggi and his associates, into 
Triad America which were then filtered — which came into t^ie 
Properties company and debt financing. So, it was a 
combination of investment capital and debt financing. 

Q And was it Mr. Adnan Khashoggi who made the final 
decision on all financial transactions? 

A Well, that's my understanding. Essam Khashoggi — we 
would go to Essam Khashoggi with our requests or our 
recommendations and our capital needs and he would indicate 
to us that he would talk to his brother and then, following 
those conversations, we would receive funds. In some 
instances, we talked directly to Adnan Khashoggi about 
funds . 

Q All right. Beginning in 1985, it appears that 






Cafttfled Shorthand n«portar - 



487 




oTHT^ 



Mr. Khashoggi beg"an dealing with Sarsvati International. 
Can you tell me briefly who Sarsvati International is and 
when that relationship began. 

A My first contact with that entity was in late 
October of '85. Mr. Khashoggi introduced me to a Mr. Ernest 
Miller and indicated to me that he represented that he was 
Sarsvati and that Sarsvati International was an entity 
somehow associated with a religious man from India that we 
referred to as Swamiji. 

Q Do you know the full name of Swamiji? 
A I can't recall it, but I've seen it a couple of 
times . 

MR. PARRY: If you want to mark this as an exhibit, 
we can, but I think that's the name. 

MR. RADCLIFFE: Is that him? 

THE WITNESS: Yes. The name Swami j imahara j i as 
printed in this article, that's the Swamiji part of it. I 
can see now where it came from. 

MR. PARRY: Okay. For the record, perhaps we 

should just make this an exhibit. It appears to be either a 

newspaper or magazine article that refers to the 

Swami j imahara j i . 

(Exhibit 1 was marked for 
identification. ) 

Q (By Mr. Parry) Now, just to clarify, you first met 



^iCUSSlHEf 



Rashell Garcia • C«fltfi«d Stiorthand Rsponar - 



488 



Minn 



Ernest Miller — and is he also the individual referred to as 
Walter E. Miller? 

A Correct . 

Q So, Ernest is his middle name but he goes by 
Ernest; is that your understanding? 

A He's always preferred Ernie or Ernest, Ernie when 
I've had discussions with him. 

Q When you first met this gentleman in October of 
1985, was it in his capacity as a representative of the 
Swami? 

A Yes. I was in New York City, the Sweuni was in 
New York City, Mr. Miller was there, Mr. Khashoggi was 
there. They had had some meetings at Mr. Khashoggi 's 
residence in the Olympic Towers and Mr. Khashoggi indicated 
to me that he wanted to enter into a business transaction. 
I was introduced to Mr. Miller as, you know, the business 
manager of the Swami. Mr. Miller and I were to work out 
documentation regarding the transaction. 

Q Okay. Before we get into the transaction, was it 
also your understanding that the Swami was a representative 
of a third party? 

A I wasn't certain. There was a — there was an 
advisor to Swaniji who was involved with Mr. Miller that I 
understood was also a representative of the Swami and I was 
told that Mr. Miller represented many wealthy people, but 




Rashe*! Garcia • Cartfled Short^and Rafjodar - 



U! 



489 



iriL 



I'm not sure what the relationship was at that time. 

Q Who was this other individual? 

A We referred to the other individual as Mamaj i and 
I — this person was of the same derivation as the Swami and 
tended to be sort of the spokesman for the Swami in business 
kinds of matters and religious matters. I apologize for not 
knowing his full name, but I met him on several occasions 
and chatted with him. 

Q He would normally be with the Swami? 

A He was generally traveling with the Swami and in 
all the times — in all the instances when I ran into the 
Swami, when I was in meeting when the Sweuni was nearby, this 
person would attend the meetings and talk about the business 
transactions. 

Q Okay. Back to October of '85, did either Mr. 
Miller or the Swami lead you to believe that they were 
representing th« Sultan of Brunei? 

MR. RAOCLIFFE: Excuse me, there's been no 
statement that Mr. Floor had contact with the Swami. 

Q (By Mr. Parry) Is that correct? Had you had 
contact with the Sweuoi in October? 

A Well, I met the Swami and had meetings with him — I 
met him, but I met him later after the business deal was put 
together. 

Q All right. 



NCUSSIFIEO 



12 



Rashall Garcia • Certffied Shofihand Reporter . 



490 



WSM 



A I was told by Mr. Khashoggi that Mr. Miller was a 
business advisor to the Sultan of Brunei. I don't recall 
being told that the Swami and the Sultan were necessarily 
linked, but Mr. Miller was linked to both of them. 

Q And who told you that? 

A Adnan Khashoggi. 

Q Did Mr. Miller ever tell you that himself? 

A No, not that I can recall. Well, my meetings with 
Mr. Miller extended into the next year and I believe it was 
Mr. Khashoggi who told me that and Mr. Shaheen who told me 
that. I'm not sure that Mr. Miller ever disclosed it. 

Q You've referred to a Mr. Shaheen? 

A Shaheen . 

Q Who is that? 

A Robert A. Shaheen is a chief of staff individual 
for Mr. Adnan Khashoggi and, in all of the time I had 
anything to do with Mr. Khashoggi, Mr. Shaheen was in that 
role and had been for son* time before. 

Q All right. Mow, there have also been references in 
various articles to a John Shaheen. Have you ever met that 
individual? 

A I have not met John Shaheen. 

Q Do you know if he is any relation to John Shaheen? 

A I'm not aware of any relationship. I don't know 
that much about Mr. Shaheen 's faunily. 



UNCUSSIFIE 



13 



Rashail Garcia • C«(i>fled Shorthand Reporter - 



491 



mtm& 



Q Just to clarify, did the swami, to your knowledge, 
or Mr. Miller have their own business transactions that were 
not related in any way to the Sultan of Brunei? 

A I believe they did. 

Q So it was possible that this transaction in October 
could have or could not have had anything to do with the 
Sultan of Brunei? 

A That is correct. 

MR. PARRY: Can we mark this as Exhibit No. 2? 

(Exhibit 2 was marked for 
identification.) 

Q (By Mr. Parry) Mr. Floor, I'd like to show you and 
your counsel Exhibit No. 2, which is a document that you' 
have produced to the Committee pursuant to the subpoena, and 
I'd like you to tell me what that dociiment is. 

A This docximent is a copy of a Stock Purchase 
Agreement that we prepared on the 30th day of October, 198 5 
relating to the transaction between Mr. Khashoggi and 
Sarsvati International. The name in the dociiment is 
Sarsbati, S-a-r-s-b-a-t-i, and the correct name is Sarsvati, 
S-a-r-s-v-a-t-i. This document was subsequently replaced by 
one that had the correct spelling and it was that document 
that was signed by both parties. But this was the document 
which I had prepared and faxed to New York for signature. 

Q Have you produced the edited copy that has the 



UNClASSffi 



14 



Rasheil Garcia • Certffled Shorthand Raportsr - 



492 



UNCLASS! 



inni 



correct spelling? 

A I believe that it's an exhibit to the documents 
later produced. Can we go off the record for just a second? 

Q Sure. 

(An off-the-record discussion 
was held. ) 

MR. PAKRV: Let's have this marked. 

(Exhibit 3 was marked for 
identification. ) 

Q (By Mr. Parry) Let's go back on the record. We've 

been referring to Exhibit 2, which is a draft Stock Purchase 

Agreement. I'll now show Mr. Floor Exhibit 3, which is a 

series of agreements with routing slips in front that — " 

MR. RADCLIFFE: How many total pages do we have 

there? Why don't you count them out. 

THE WITNESS: Twenty-nine pages. 

MR. RADCLIFFE: So, the exhibit consists of 29 

pages . 

Q (By Mr. Parry) Yes. Now, Mr. Floor, to the best 

of your knowledge, does Exhibit 3 contain the final version 

of the Stock Purchase Agreement represented by Exhibit 2? 

A Yes, it does. 

(Exhibit 3-B was marked for 
identification. ) 

THE WITNESS: It is an exhibit to the agreement. 

15 



yHCLHSSinES 

- Rashatl Garcia • C«(lifl«d Shodhand Reporter • 



493 




f^- f. - ' V *-^ 



difiliy 



You've marked it as Exhibit 3-B. 

Q (By Mr. Parry) All right. 

A And that is the final dociiment which was the result 
of the negotiations in New York and subject to some changes 
that occurred between the two dates. 

Q And Exhibit 3-B is dated November 15th? 

A The 15th day of November, 1985, and the word 
Sarsvati is correctly spelled. 

Q All right. 

A And it is signed by both Adnan Khashoggi and the 
other signature for Sarsvati, that's Mr. Miller's signature. 
That's Walter Miller's signature. 

Q And that is on page 4 of Exhibit 3-B, it appears? 

A Correct. 

Q All right. Now, Exhibit 3-B incorporates other 
financing agreements in addition to the one originally 
discussed; is that correct? 

A Correct . 

Q Can you summarize the various loans or agreements 
that are incorporated in that document? Now, I'm not asking 
for your legal conclusions as to what exactly the agreements 
require, but just a general summary of your understanding of 
what those agreements were. 

MS. RAOCLIFFE: His understanding as a layman? 

Q (By Mr. Parry) Yes. 



HNWSSiPB 



16 



Rasholl Garcia • C«rttfl«d ShortharKj Reporter - 



494 




Si 



uOliC it^'^^*' 



A Exhibit 3 is a collection of the loan documents 
that relate to a series of transactions between 
Mr. Khashoggi, Sarsvati International, and other entities 
that were the result of meetings in the Cayman Islands in 
early March, 1986. One of the transactions was a 
consolidation of three earlier loans, one of which is the 
loan referenced as Exhibit 2 and subsequently closed and 
this referenced as Exhibit 3-B. Could we go off the record 
again for a moment? 

Q Sure . 

(An off-the-record discussion 
was held.) 

Q (By Mr. Parry) Let's go back on the record. Going 
back to Exhibit 3-8 which is dated on the front page 
November 15th, 1985, and appears to be executed by Triad 
International Corporation, Triad America Corporation, Adnan 
Khashoggi and Sarsvati International— 

A Correct . 

Q — did you witness the execution of this document? 

A I did not. 

Q Can you tell me what your knowledge is as to when, 
where and by whom this docioment was executed? 

A I believe the document was executed by 
Mr. Khashoggi and Mr. Miller on November 15th. I'm not sure 
where they were at the time. This document — a copy of this 



\i«ElftSS\! 



niVi. 



flLU 



17 



Rashall Garcia- C«rttflad Shorthand Reporter - 



495 



irosssffi 



document was sent to us in Salt Lake City for our files and 
a copy of this document was presented to me at the meetings 
in the Cayman Islands and was represented to me by 
Mr. Khashoggi and Mr. Miller and others as being a copy of 
the agreement they'd entered into. 

Mr. Khashoggi and Sarsvati had entered into three 
loans and this was one of the three. At the same meeting in 
the Cayman Islands, I was given the Promissory Notes of the 
other two loans and that is copies of them. I was told that 
all three loans had been entered into and that it was the 
desire of the parties to consolidate the loans. So, 
Mr. Khashoggi and Mr. Miller and Mr. Miller's advisor, 
Mr. Fraser, told me that the assignment was to consolidate 
these three loans into a single loan. 

Q Now, you referred to a meeting in the Cayman 
Islands. 

A Yes, sir. 

Q When did that meeting take place? 

A That meeting took place on March 4th, 5th and 6th 
of 1986. 

Q All right. Can you tell me who attended the 
meeting or meetings on those dates? 

A The meetings included — there were two or three — 
there were different sessions but, essentially, present some 
or all of the time were Adnan Khashoggi, Robert Shaheen, 



ICUSSiF 



13 



Rashall Garcia • Certtfled Shorthand Reporter • 



496 



«yfiss 






ii'H 



Walter Ernest Miller, Donald Fraser, and Mr. Ivan Surges was 
in the offices. We were in the offices of Euro Commercial 
Bank. He was not, however, privy to the meetings discussed 
in the transactions. There was an attorney, Mr. Graham P. 
May, whose offices were in the same building, or near — yes, 
the same building — and he attended most of the meetings. 

There were a couple of meetings where all of the 
parties were present and then there were meetings where 
Mr. Fraser and I and Mr. May negotiated the transactions 
which were consummated at that time. 

Q And all three loan transactions were discussed at 
one or more times during these meetings? 

A Well, the consolidation loan was discussed as were 
other loan transactions that were discussed, yes. 

Q Okay. Can you tell me what the substance of the 
discussions— or what were the purposes of the loans and who 
was actually doing the funding? 

MR. RADCLIFFE: You're talking about the March '86 
meeting? 

Q (By Mr. Parry) Yes. 

A Mr. Khashoggi and I and some other staff flew to 
the Cayman Islands from New York City early the morning of 
March 4th, as I recall, and we were to discuss a series of 
financings involving Mr. Miller and his entities. There 
were to be three basic loans. One was to be a consolidation 



UNWSSilii 



19 



RastiMI Garcia • C«rtMad Shorthand Repoitar • 



497 



tims 






of the three earlier financings entered into between 

Mr. Khashoggi and Sarsvati, and I've referred to — I refer to 

that as the $21 million dollar loan, which was the sum of 

the three loans added together. There was an $8 million 

dollar loan, a $7 million dollar loan, and a $6 million 

dollar loan, which together represented the $21 million 

dollars. 

A second loan, which we discussed, negotiated and 
closed, was a $9 million dollar loan between a bank that 
Mr. Miller and Mr. Fraser controlled and Triad America. And 
this loan was to finance certain Triad America obligations. 

The third loan, which was discussed and signed, was 
a $10 million dollar loan, which we characterized as a iTsan 
to facilitate certain international marketing. 

So, those were the three loans, the $21, the $9 and 
the $10. 

Q All right. Before we get on to what was discussed, 
the $21 million dollar loan, was that intended to fund Triad 
America in any way? 

A Well, the $21 million dollar loan, we signed in the 
Cayman Islands. All the money had been funded and of the 
$21 million dollars, $3 million dollars had come to Triad 
America, which was a part of the loan that was written up 
originally in late October and closed subsequently on 
November 15th. There was a $6 million dollar loan which was 



UNCLASSiflM 



20 



Rufiall G«rci« • Certified Shoftrund R«port»r • 



498 



\imm 



dated in the documents, the Promissory Note, as January 5th, 
1986, and there was the $7 million dollar loan which was 
dated November 18th, 1985. None of those funds came to 
Triad America. 

My understanding is those funds went to Adnan 
Khashoggi or his designees. I might point out, too, that 
during the meetings in the Cayman Islands, there was some 
debate as to when the January 5th loan actually had closed 
and Mr. Khashoggi told me that that money had actually come 
to him prior to the loan that we documented in New York and 
that it was done, in a sense, on a handshake. We dated the 
note January 5th because no one could remember what the date 
was that the money actually moved. 

There was also some discussion about whether the 
total was $21 or $22 million. Mr. Miller thought it was S22 
million, and Mr. Khashoggi was sure it was $21 million. 
They made a phone call to either Swamiji or the Mamaji and 
determined that it was $21 million, and so there was some 
clarification as to the $21 million dollars of funding that 
went on during this March meeting. 

Q Was that an unusual circumstance to someone to 
extend $6 or $7 million dollars on a handshake or is that 
the way Mr. Khashoggi often does business? 

A I thought it was an unusual situation. I'm not 
sure how that kind of business is done but I thought it was 

on" 




Rashall Garcia • C«rmied Shorthand Reporter • 



499 




ms 



unusual . 

Q To your knowledge, had that been done before when 
Mr. Khashoggi — 

A I don't )cnow about all of Mr. Khashoggi 's loan 
transactions. It had not been done in the other 
transactions in which I had been involved but I hadn't been 
involved in all of them, certainly. 

Q And when was this money extended to him? 

A Well, what I was told in the Cayman Islands by 
Mr. Khashoggi and Mr. Miller and Mr. Shaheen was that the $6 
million dollars was the first of the three transactions and 
that it occurred prior to my meeting Mr. Miller in New York. 

Q Prior to October of 1985? 

A Yes. And then we did the October loan, which 
closed in November, which sort of set a pattern of 
docvunentation. Then there was the third loan that was 
funded shortly after the second loan was funded. Then in 
the Cayman Islands on March 6th, we properly docxunented the 
three transactions. 

. Q Let's go to the $9 million dollar loan. That was 
intended for Triad America? 

A Yes, sir. 

Q And was that funded? 

A $1 million of the loan was funded while we were 
meeting in the Cayman Islands. Money was wired to Salt Lake 




^MM 



22 



Rasnell Garcia- CarMad Shorthand Reportar ■ 



500 



UNClMIEI 



city. Additionally, about $6 to $700,000 was funded prior 
to my leaving the company in early September of '86. I do 
not know whether any other part of it was funded. 

Q To your knowledge, you only know that approximately 
$1.7 million dollars of the $9 million dollars was actually 
funded then? 

A Yes, and there was no question that that's all that 
was funded through late August of '86. After that time, I'm 
not sure what was done. 

Q Do you know why additional funding or the complete 
$9 million wasn't funded at the time? 

A I was told that the groups that Hr. Miller and 
Mr. Fraser represented— that they themselves would make the 
decision about what portion of the loans would be funded. 
When we closed the loan— I'm sorry, when we signed the loan 
in the Cayman Islands, the $9 million dollar loan, I 
provided a schedule of payments that were to be made under 
the loan. My understanding was that the loan would fund 
that schedule. 

However, we met again before the end of March in 
Geneva to work out complications in the final documentation 
of the loans and it was determined at that time that 
Mr. Miller and Mr. Fraser would, in their judgment, alone 
make decisions about how the loan would be funded. And the 
amount funded was what they deemed appropriate and they 



UNCLfcSSlFiE 



23 



RastiaU Garcia • C«rilfl«d Shofthand Reporter ■ 



501 



nmsst 



nF- 



weren't willing to fund the rest. 

Q Now, the $10 million dollar loan, which was 
designated as intended to finance international marketing — 
is that the term? 

A Ves, sir. 

Q What was the understanding or what were you told 
was the international marketing — or what was the merchandise 
that was going to be marketed? 

A I was advised in the Cayman Islands that the 
merchandise to be marketed was weapons. 

Q Any specifications as to the type of weapons? 

A No; military hardware. Weapons was the general 
term used. 

Q What was their destination? 

A Iran. 

Q Do you know what their origin was? 

A No, I don't. I was told that the sellers of the 
weapons wouldn't release them without the money and that the 
buyers, Iran, would not buy them without the weapons, and 
that it required financing to bridge the differences between 
the parties. 

Q Okay. And was it at the meeting in the Cayman 
Islands — was that the first time that you were told that the 
financing related in any way to weapons? 

A Yes, sir. 



wmm 



24 



ed Stiontiand Reporter • 



502 



lEdSSSW 



Q Now, was that the first time that you had been told 
that Iran was involved in any way in the international 
marketing? 

A Yes, sir. 

Q Who told you this? 

A Adnan Khashoggi told me— told all of us in a 
meeting — in one of the meetings in the Cayman Islands — the 
transaction was actually a series of transactions and the 
$10 million dollars was actually going to fund the joint 
venture between Vertex — at least it was proposed in the 
Cayman Islands that it would fund a joint venture between 
Vertex and Adnan IQiashoggi and that Euro Commercial or one 
of Mr. Miller's entities would fund a $10 million dollar* 
loan to Mr. IQiashoggi. Mr. Khashoggi would convey the $10 
million dollars to a joint venture to be known as Trivert 
International, that Trivert International would then enter 
into the transaction which was described to us. 

Q All right. Now, we've gone from Sarsvati to 
Vertex. 

A Yes. 

Q Do you know who the principals were or who 
controlled Vertex? 

A I was told that Mr. Walter Miller controlled Vertex 
and that Vertex was somehow related to Sarsvati. All of the 
Sarsvati loans were assigned to Vertex as a part of the 



UNCUSS! 



25 



Rashall Garcia • Caritflad ShoriAand Reportar • 



503 



Mciissioa 



transaction in the Cayman Islands. 

Q Was it your understanding then that the Swami was 
also involved in Vertex? 

A It was my understanding that the Swami was involved 
in all of the things we were talking about, that is, all of 
the companies, all of the entities, but I'm not certain as 
to what relationship he had. 

Q Was anything ever said to you or was anything ever 
done that would lead you to believe that the Sultan of 
Brunei was involved in Vertex or with these dealings? 

A Not directly. 

Q Indirectly? 

A Well, I was told that Mr. Miller represented many 
very wealthy people and that Vertex was a vehicle through 
which some of that money was invested on behalf of these 
individuals. I was also told that Mr. Miller represented 
the Sultan of Bninei. I was not told that the Sultan of 
Brunei's money was involved in Vertex but I was also — I 
mean, it was never a question that was raised. I don't 
know. 

Q Now, you have met the Sultan yourself, haven't you? 

A Yes, sir. 

Q Can you tell me about — has it been more than one 
occasion? 

A No, sir, just on one occasion. 



Mussra 



26 



,^^ofthand Reporter - 



504 



msM 



Q Can you tell me what the purpose for that was? 

A Well, there were two or three meetings during one 
trip. 

Q Can you describe that trip? Tell me the purpose of 
the meetings and who was there. 

MR. RADCLIFFE: When did it take place? 

Q (By Mr. Parry J Yes. Thank you. 

A In March of 1985. I'd have to check my passport to 
get you the specific date. I was asked by Bob Shaheen and 
Essam Khashoggi to prepare a proposal for the Sultan of 
Brunei in which the Sultan of Brunei would be asked to 
invest substantially in Triad America. With my associates 
in Salt Lake, we prepared the presentation, which was 
essentially a summary of Triad America's operations, 
financial statements, opportunities, and a series of 
proposals. We did this in consultation with Mr. Khashoggi — 
Adnan Khashoggi and his brother, Essam, and we prepared that 
document . 

I took my copies of the document and flew to Hawaii 
where I met up with Adnan Khashoggi and his party, and 
Essiun Khashoggi and his family were already in Hawaii, and 
together we left Hawaii and flew to Brxinei on 
Mr. Khashoggi 's DC-8. 

We prepared a videotape on the ten years of Triad 
America's operations in Utah. We prepared financial 



yNCLKSfflEO 



27 



Rashall Garcia • C«rtfled Shoflhand Reporter - 



505 



PFir 



statements and a presentation and we took along some gifts 
and other items. 

We flew to Brunei. We arrived early in the day. 
On the day of arrival, we were escorted to a guest house, a 
lovely guest house, and all of us stayed there. We then met 
with the Sultan of Brunei at the Khashoggi DC-8 and we made 
our presentation to him, showed him the videotape and 
outlined the presentation. 

That evening, we were all invited to dinner at the 
Sultan's residence. The Khashoggis, their wives and others 
were in the party and we made a — we repeated the 
presentation to the Sultan's financial advisor at the 
dinner — after the dinner. 

Q This was well before there was any discussion with 
Mr. Miller or Mr. Fraser? 

A Yes, this was in March of '85 and the first meeting 
with Mr. Miller was in the fall of '85. 

Q All right. So, to your knowledge, you had no 
knowledge that the Sultan had any connection with the 
meetings in the Cayman Islands or those financial 
transactions? 

A Not until on the way to the Cayman Islands that 
next year, a year later. Mr. Khashoggi — well, let me say 
this: We made our presentation. The Sultan's advisor said 
that they would take the matter under advisement. 

28 



Shorthand Reporcsr ■ 





506 



Vi f i/Lflliv- ^'" '*- -I 

Subsequently, we were TorcT the' Svflisair turned down the 

investment opportunity. 

That fall, around October when I was in New York, 
Adnan Khashoggi said to me that Mr. Miller was very 
important because, after all, he was the Sultan's advisor as 
well. He said the reason we were turned down is they didn't 
like our deal and he said these are important people for us 
to get to know and, following the October meeting — 

Q And by "they", you mean Miller and Fraser? 

A Miller and Fraser. Following the October and 
November loan closings, Mr. Fraser and Mr. Miller ceune to 
Salt Lake City to tour the Triad America operations and I 
was again told that they, Mr. Miller and Mr. Fraser and the 
people they represented, might have an interest in investing 
more in Triad America. The trip to the Cayman Islands in 
March was again a part of that ongoing process. 

Q Let's go back to the discussion of the weapons 

deal . I ' d 1 ike to show you another document that you ' ve 

produced. Let's have this marked as the next exhibit. 

(Exhibit 4 was marked for 
identification. ) 

Q (By Mr. Parry) I'm referring to the discussions at 
the March meetings in the Cayman Islands beginning 
March 4th. I'd like you to look at Exhibit 4 and identify 
that document. 






29 



Rasholl Garcia • C«filflad Shoftfiand Reponar - 



507 



— mmm 

A Exhibit 4 is a photocopy of a document I have in my 
files which was a sketch or chart or drawing prepared by 
Adnan Khashoggi to illustrate to Mr. Miller, Mr. Fraser, 
myself — and perhaps the attorney was in the room — the 
transaction which was to be contemplated— which was 
contemplated by the $10 million dollar loan. 

Q All right. And who was present when this document 
was created? 

A Well, I know for certain Mr. Donald Fraser, 
Mr. Miller, Mr. Adnan Khashoggi and myself were in the room. 
I'm not certain whether Bob Shaheen was in the room at the 
time and I'm not certain whether Mr. May, the attorney, was 
in the room, but I believe so. 

Mr. Khashoggi and Mr. Miller and Mr. Fraser and 
Mr. Shaheen and I had met when we first arrived in the 
Cayman Islands and we had talked generally about the three 
loans. 

Mr. Khashoggi and Mr. Shziheen left the island by 
plane and went somewhere else — I think they went to Florida, 
I'm not sure~jmd they were gone for about a day, day and a 
half. While they were gone, Mr. Fraser and I were to 
conclude the negotiations of these loans. Mr. Khashoggi was 
to come back, we were to go over the loans and sign the 
documents. It was rather clear that my understanding of the 
$10 million dollar loan and Mr. Fraser wasn't what 



iCLASSiFIED 



i 



RastiflU Garcia • Certlftcd Stiorthand Raportar • 



508 



ICUSSiFIFfl 



Mr. Miller's understanding was. There was some confusion 
about how Mr. Miller and his associates would participate in 
some profits. 

And so when Mr. Khashoggi came bacic, we explained 
to him what our understanding of the transaction was. He 
says. Oh, no, it's a joint venture, what's mine is yours, 
what's yours is mine, we're going to be partners. And so he 
took out my yellow pad and he sketched a transaction in 
which — and he explained how the $10 million dollars of funds 
would move from Triad International Marketing— 

Q Maybe we can walk through the document as he drew 
it so we'll know what you're talking about. You're pointing 
at a square at the top of the page? 

A Yes, there's a square at the top that has TIM, 
Triad International Marketing, and he said that the money, 
the $10 million dollars, would go into a joint venture and 
that the $10 million dollars would go — and he had a box with 
a "Y'*, and ha said, "This Is where we buy the arms." Then he 
drew an arrow down to a box in which he put the words 
"Iran". Then he drew a line back up through a box in which 
he wrote the name "Monacur Gobonaf ar" . He wrote a name at- 
-he was trying to pronounce it and he wrote it out and, you 
know, it's obviously the name of TBHBBHHBIMBaAV. 

Off to the right, he wrote "Credit Swisse" and he 
wrote $10 million dollars back into JAe joint venture, and 

Rashell Garcia • Carttfled Shorthand Reporter 



509 




i^jOtTtt^ 



then the $10 million dollars became the $11 and the — the 
square actually starts with "Credit Swisse". In other words 
$10 million dollars from Credit Swisse goes into this 
venture, the venture buys the arms, the arms are shipped to 
Iran, Iran pays for the arms, except when the money comes 
bade through, it's $11 million dollars, and there was to be 
a profit. Part of the profit was to go to Triad 
International Marketing and part of the profit was to go to 
others, including something that he described as BCCI, and 
then he put $40 million dollars, "40,000" and underlined it 
and indicated that this $10 million dollars would go through 
four tim6s producing $40 million dollars of sale and, 
therefore, additional profit. 

Following his laying out of this transaction, we 
then rewrote the document and everybody went off to have 
lunch and the attorney and I busily worked at rewriting the 
document to create the entity, Trivert International, and 
form the joint venture which the document contemplated. 
Then we even went so far as to prepare the Promissory Note 
where Mr. Khashoggi would owe the money to Vertex and then 
Trivert would owe the money to Mr. Khashoggi, and we had 
other documents that were involved. 

Q All right. Let me interrupt you. The attorney 
you're referring to is Mr. May? 

A Yes, Grah2un P. May. 




' Rastiell Garcia • Centflad Shorthand Raportar ■ 



510 



'.^ e 




Q Another question. You're referring to the joint 
venture as Trivert in the subsequent agreement. The name in 
the box that you have indicated as the joint venture — 
Mr. Khashoggi has a different name. Do you know what that 
name is? 

A No. Well, he referred to some vehicle. I thought 
he used the word Garnet, the name Garnet. 

Q Okay . 

A But the Trivert nzune, actually what happened at the 
top where "TIM" is, he put a box and he put an "X" in it and 
that was going to be the joint venture. The point he made 
was that Triad International Marketing had the agreement but 
because of this financing, that Trivert would have it. fmd 
so Trivert took the place of Triad International Marketing, 
is my understanding of this document. 

Q That is. Triad and Vertex — is that the derivation? 

A Yes, that's how they ceune up with the name. 

Q Now, the box with the "Y" in it — 

A Yes. 

Q Did he say anything to indicate who that person or 
entity was? 

A No, it was the source — and I'm not sure whether it 
was one source or several sources — that's just — the weapons 
were going to come from "Y**. 

Q Okay. Now, did he ever mention the involvement of 



mm 



*« -ft J 2^ 



Rastiall Garcia • Certtflad Shoilhand Repoftar - 



511 



UNElASSlHi 



Tnrrr 



the Israeli government or Israeli citizens? 

A Not in my presence. I have no idea what he said to 
Mr. Miller separately but not in my presence. 

Q Was M a naeur Quboiiafa r the only individual that he 
specifically named as being involved in the transactions? 

A Yes, sir. He referred to his associates two or 
three times. He said, "These are my associates," and when he 
wrote BCCI down, he said some name but I can't recall what 
it was. 

Q Now, at these meetings in the Cayman Islands or at 
any future time, did he indicate the identities of any other 
individuals involved in the arms transactions? 

A Not to me. 

Q Did he ever indicate the involvement of United 
States Government officials? 

A Not that I recall. 

Q Did he ever make mention of involvement of a 
Mr. McFarland or Poindexter or North? 

A Not in my presence that I can recall. 

Q So, as far as you knew, there was an arms 
transaction to Iran but you did not Icnow the source or who 
was involved other than Monaour O o bon a f a g ? 

A That is correct, but it was not just a transaction, 
there were to be a series of transactions and Mr. Khashoggi 
told me that he hoped in the future there would be 




Rashall Garcia • Cenffled Shorthand Reporter - 



512 



ia4 



assw 



substantially more business because of this. 

Q Involving weapons or other products? 

A He just said this would open up a big market. 
That's all he said. 

Q And you understood that to mean Iran? 

A That's right. 

Q Did he or anyone indicate at these meetings or any 
other time that there had been previous transactions 
involving weapons to Iran? 

A It's my recollection that when he described this 
transaction on Exhibit 4 , he described it as something that 
had been done before but he didn't talJc about dollars or 
times or places, it was just my impression that he needed 
substantially more money to do what needed to be done. 

Q What was to be the collateral for the arms 
financing? 

A Mr. Khashoggi in the Cayman Islands — we signed a 
loan agreement which provided that Mr. Khashoggi 's holdings 
in the stock of American Barrick would be the collateral for 
this loan as well as stock of Triad America Corporation. 
Now the American Barrick stock was really not — actually, 
there was a company called Horshem Securities, Limited which 
had a beneficial interest in stock and the agreement was 
that the note would be secured by an assignment of the 
Trivert note. In other words, he would borrow the funds. 



yiUSSIF!! 



35 



RashatI Garcia • C«riMad Shorthand Reporttr - 



513 



HEttSSl 



give it to Trivert, take the Trivert note and assign that, 
plus the American Barrick stock through Horshem Securities 
plus some Triad America stock. The American Barrick 
Resources asset had a previous assignment to it, to another 
entity, and they took it subject to that. 

Q Do you have any knowledge as to whether this $10 
million dollar loan for the arms transaction was ever 
funded? 

A I don't know whether the loan whose documents we 
saw in the Cayman Islands was funded, but I'm satisfied that 
a subsequent $10 million dollar loan was funded. Well, I 
believe a second $10 million dollars was fxinded and the 
reason I say that is Mr. Khashoggi — following the Cayman' 
Islands meetings and following the meetings in Geneva which 
occurred later in the month, Mr. Khashoggi was extremely 
anxious to get the $10 million dollar loan closed. All of 
the transactions relating to Triad America in these loan 
docxunents had to be consummated in order to close the loans. 
Following all of this discussion and these transactions and 
following the arrival of Mr. Miller and Mr. Fraser to take 
over the operation of Triad America, they subsequently 
disengaged, and during the disengagement process, we were to 
pay certain legal fees to their Salt Lake based attorneys 
but not the legal fees relating to a $10 million dollar loan 
to Adnan Khashoggi which closed in late April. 



KLASSfflFJ 

Rash«(l Garcia • Cen«l«d Shorthand Reporter ^^^ ^ — :: TTTZ 



514 






So, I personally believe that the loan we 
contemplated here closed or there were two $10 million 
dollar loans and I don't know which it is. 

Q You referred to a sxibsequent meeting in Geneva. 
When did that occur? 

A March 17th or 18th — and maybe on both days. 
Following the meeting in the Cayman Islands, I flew to 
Geneva to take care of certain paperwork relating to these 
transactions and to take care of other business. 

Mr. Khashoggi flew to France. His sister died in 
Cairo and he flew to Cairo for the funeral. In the 
meantime, documents were being prepared in Salt Lake City by 
counsel for Triad America and for Vertex, Euro Commercial, 
et al, and disputes had arisen regarding the final nature of 
the transaction, final details. 

I had sent all of the documents in Exhibit 3 from 
Geneva to Salt Lake to be forwarded to various people that 
needed to have them. Well, in the negotiation or the 
discussion with the attorneys, it became clear that there 
were some disputes as to what was intended on some of the 
documents and so Adnan Khashoggi and Bob Shaheen and 
Mr. Miller, Walter Miller, and Mr. Fraser and Mamaji and 
Tariq Kadri, another member of the tribe — and me all met in 
Geneva to discuss the transaction one more time. And those 
meetings were held approximately the 17th and 18th of March. 



37 




1 AQQfP*:^ 



•I}3ii4t|a(£%9(«;!l»nd Reponer • 



515 



flmsi 



!Li^' 



Q VThere in Geneva were they held? 

A They were held in Mr. Khashoggi's suite at the Noga 
Hilton Hotel, I believe on the fourth floor. I can't 
remember for sure. And they were held in Mr. Khashoggi's 
suite. 

Q You mentioned a Tariq — 

A Kadri, K-a-d-r-i, yes. 

Q Is he a Saudi national? 

A No, he's an American citizen bom in California. 
He has a — I believe his parents were Iraqi but I'm not sure, 
which is — 

Q He's another American executive? 

A American executive of Triad America, yes. He's^an 
attorney, graduate of Georgetown. 

Q After March of 1986, did you have any further 
discussions with Mr. Khashoggi or anyone else regarding the 
financing of the arms transactions? 

A Not directly. Following the March Geneva meeting 
into late March and into April, I was on the phone several 
times with Mr. Khashoggi trying to get the Canadians — I 
refer to Mr. Fraser and Mr. Miller as the Canadians — to get 
these loans that we negotiated closed, and he, on two or 
three occasions, told me that the $10 million dollar loan 
should get closed, but we did not discuss the purpose of the 
loan again or any of those sorts of things. 



WSM 



38 



Rathall Garcia • C«f«fl«d Shormand Reporter - 



516 




Ou' 



■If. 



Q I'd like ?o'go~a little deeper into your 
involvement with the Canadians. When you say the Canadians, 
you mean Mr. Fraser and Mr. Miller? 

A Yes, sir. 

Q Was it after these meetings in March that they 
began to play an active role in the management of Triad 
America? 

A Well, yes. At the Geneva meeting, it was agreed 
that the board of directors of Triad America would be 
reconstituted from its then three members to six members. 
Mr. Fraser and Mr. Miller and Mr. Ivan Surges, who was at 
the bank in Cayman, would be three directors appointed by 
Vertex. And Mr. Essam Khashoggi, Mr. Tarig Kadri and I 
would be three directors appointed by Triad, and that 
Mr. Fraser would become the president of Triad America and 
that in the case of a tie, Mr. Fraser would vote the tie- 
breaking vote or the casting vote. He referred to it as the 
casting vote. 

And so the decision was made in Geneva that 
Mr. Miller and Mr. Fraser would operate the company and it 
was agreed that they alone would decide how the funds were 
to be used from the $9 million dollar loan. I offered my 
resignation at that time and was told. No, that they wanted 
us to continue. So, Mr. Kadri was to set up energy 
operations and I was /head of real estate operations. We 







Hashed Garcia • C«rtlfl«J Shorthand Reportw 




517 



were both still on. the Triad board. 

They came to Salt Lake City folloe^ing the Geneva 
meeting within two or three days and proceeded to implement 
their management of Triad America. So, th«y took not only 
an active tole, they took control of the coopany on about 
March 20th of 1986. 

Q And so from that time until the t. ne you left Triad 
America, Mr. Miller and Mr. Fraser have be« n in control of 
the company and of the properties? 

A No. No, they were in control unt; L late April, 
maybe early May, when serious problems wen developing in 
the operation of Triad America and I advis* 1 the Khashoggis 
that I felt Mr. Miller and Mr. Fraser were destroying thfr 
company, not saving it. It was agreed then that Mr. Miller 
and Mr. Fraser should disengage from Triad America. 

So, Mr. Tarig Kadri and Essam KhacVioggi and 
Mr. Adnan Khashoggi had meetings in Mew York City and in 
Paris and in a couple of other cities with Mr. Miller and 
Mr. Fraser trying to work out some kind of disengagement. 

It was during this period that th. disengagement 
memoranda were prepared by Parsons, Behle 4- Latimer. 
Q Maybe we should mark those as an • <hibit. 

MR. RADCLIFFE: Collectively? 

MR. PARRY: Yes. 

5 wa: marked for 
atioi . ) 




Rash«ll Garcia •C«rtifl«dShonhandR«po sr- 




518 



Q (By Mr. Parry) Look at that and count the pages. 

A There are 29 pages. 

Q All right. Are you familiar with Exhibit 5? 

A Ves. I believe there are 3 pages. 

Q Thirty pages. Can you tell me what these 3 pages 
represent? 

A Yes, this is a copy from my files of a telefax that 
was sent from Parsons, Behle & Latimer to my office in Salt 
Lake City relating to the disengagement of the Vertex 
interest from Triad and what it was, actually, is the law 
firm of Prince Yeates had prepared the documents -- 

Q Who did Parsons, Behle & Latimer represent and who 
did Prince Yeates represent? 

A Parsons, Behle & Latimer represented Triad America 
and Prince Yeates represented Vertex, Mr. Miller, 
Mr. Fraser, Euro Commercial — let's say the Miller interests. 

Q All right. 

A Prince Yeates — following the meetings held in Paris 
and New York and elsewhere, there was discussion that there 
should be a separation or settlement agreement. Prince 
Yeates on behalf of Mr. Miller and others prepared a release 
and other docvunents which would unscramble the egg, if you 
will, which would release the various parties and which 
would separate the parties but it clarified certain issues. 
Well, this document was prepared, this particular 



!INnJ AfJJslRFI 



tim'J i'n' •iJi'i i uii^,^' 

Rashfltl Garcia • Certtfled ShorthaiNl Reporter • 



519 



Hffisim 



draft was prepared, by Prince Yeates and was sent by 
photocopy over to Parsons Behle who then sent the photocopy 
on to us and, hence, across the top there are two series of 
numbers, one from the Prince Yeates law firm sending it to 
PBL and one from PBL sending it to us. This was sent to us 
to determine — to review and it was sent at night. We were 
all working late. This was sent to tell us what was being 
proposed as a separation. 

From this document, it was determined that there 
would have to be subsequent meetings and there were 
subsequent meetings and, finally in June, a final release 
document was signed separating the parties. And so this is 
a draft of the release that was subsequently signed, and 'I 
suspect that somewhere in my files, I have a file copy. 

Q So there was a disengagement that actually took 
place? 

A Yes, sir. 

Q And whan did that occur? 

A It occurred in June. I'd have to check the dates, 
but in my recollection, it was about the middle of June, 
middle to lata June. 

Q After the end of June, did you have any further 
communications with Mr. Miller or the people representing 
that group? 

A No, not — well, yes, I did. In late August, June 



IINW; 



fc8«y 



Rasheil Garcia • Ortfled Shorthand Raporter - 



520 



ncra 



and July and early August, we attempted to solve the Triad 
America problems. Mr. Adnan Khashoggi came to Salt Lake on 
two or three occasions to meet with banks. By then the 
company was having serious financial difficulty and was 
unable to meet its obligations. On August 22nd, which I 
believe was a Friday, the Triad America board met in Salt 
Lake City for some meetings and Mr. Ernie Miller and Don 
Fraser were in the building at the same time. Mr. Adnan 
Khashoggi had meetings with them and then meetings with the 
board and then brought us all together and announced that 
Mr. Miller and Mr. Fraser were going to come back in and 
take charge of Triad America once again, that they had 
agreed to fund certain immediate obligations that had to be 
funded and that at that time, Essam Khashoggi resigned as 
chairman and director and president of Triad America. Adnan 
Khashoggi then became chairman, Mr. Fraser became president 
and I continued as executive vice president and director. 

Again, I offered my resignation to Mr. Khashoggi. 
He didn't want to accept it; however, on August 26th, I did 
resign as a director and on September 3rd or 4th, I resigned 
all of my posts with Triad. So, they came back in and 
continued to operate Triad America. I have no idea what 
their current status is. 

Q So, since your resignation was accepted in — 

A Early September. 



UdCLASSIFIE 

RasheirGarcla • Certiflad Short 



43 



Shorthand Reporter ■ 




521 



Q Early September, have you had any further 
communications with Miller and Fraser in their 
organizations? 

A I've talked with Mr. Fraser in person and by phone 
on two or three occasions regarding my separation agreement. 
Mr. Khashoggi signed certain documents which promised 
certain payments which have not been made and I discussed 
those matters with Mr. Fraser. 

I also discussed with Mr. Fraser certain litigation 
against Triad America in which they wanted my assistance, 
and I guess the last conversation I had with him was prior 
to the first of this year. 

Q During any of those conversations since your 
resignation, did they specifically discuss Mr. Khashoggi 's 
default on the $10 million dollar loan to finance the arms 
transactions? 

A No, they did not. 

Q Has there been any discussion between you and 
Mr. Miller or Mr. Fraser regarding the arms transaction 
since the revelations in the media by Mr. Meese of the arms 
transactions? 

A No. 

Q Have you had discussions with Mr. Khashoggi or any 



24 of his representatives since the revelations in the public 



25 



regarding the arms transactions? 



UNCLASSI 



44 



Rasfiotl Garcia • CcrMad Shorthand Reporter • 



522 



Mmm 



A Well, I've certainly had conversations— yes, I have 
had. 

Q Regarding the arms transactions? 

A Since the disclosure was made to the public, yes. 

Q Can you tell me what those conversations were and 
who was involved? 

A Yes. I want to characterize them correctly. I had 
conversations with Mr. Shaheen regarding Mr. Khashoggi's 
various appearances on the news media. Following his 
appearance on the Barbara Walters Show, I called him, talked 
to Shaheen, and talked to Mr. Khashoggi. I told him that I 
thought his presentation was clear and coherent and I 
thought he looked good. It was sort of a courtesy call. We 
did not discuss the substance of the matter. 

Then following the disclosures made, many news 
media representatives called me and wanted my comments and 
asked questions regarding Triad America's involvement. And 
other than the conversations I had in the Cayman Islands, 
which I disclosed to a couple of people, there was no other 
involvement . 

I did on occasion call Mr. Khashoggi and 
Mr. Shaheen and say. Hey, I'm talking to CBS Morning News or 
I'm talking to somebody, and they — I'm the only guy that 
defends Adnan's paying his bills and my focus was primarily 
on his role in Salt Lake City. 



UNCIASS'IIED 

Hashed Garcia • Cwttled Shorthand Reporter • 



45 



523 



wmms 



On one occasion, I discussed with Mr. Shaheen that 
I had this memo dravm by Adnan — 

Q You're referring to Exhibit 4? 

A Exhibit 4. And he said. Fine, and it didn't go any 
further than that. So, the discussions were pretty minimal. 

Q There was never, since your name has appeared in 
the paper, there's never been any communications with you 
from Mr. Khashoggi's people or Mr. Miller's people regarding 
what you have purported to have told the newspapers? 

A Yes. Following the Knight Ridder story, the Knight 
Ridder people — the representative of Knight Ridder inter- 
viewed me in New York City in late January when I was — I was 
there on other business. The story ran quite a bit later 
than that. After the story ran. Bob Shaheen called me and 
told me that Adnan was very disappointed in the story and 
felt that I'd let him down somehow in that article. Of 
course, I had not seen the article at that time. That is, 
it had run in eastern papers and what had run in Salt Lake 
apparently was just an aibstract. It wasn't until later that 
I saw the full article in which my trip to the Cayman 
Islands was described. 

Bob told me that he and Adnan — Adnan particularly — 
was very disappointed about the article, but he didn't tell 
me why. 

Q Did they suggest that anything you said was not 



llJmAa^ 



46 



524 



■- UNGLASSiflEB 

A No , they did not . 

Q Did they imply that you should retract your 
statements or make any correcting statements? 

A No, they did not. 

Q They just indicated disappointment? 

A Yes. 

Q Was it at the fact that you had talked to the paper 
or the fact of what you had said to the paper? 

A They didn't say what bothered them but my 
impression is that what I had said bothered them. As I 
recall the conversation, my recollection is that Bob said, 
Manny, Manny, why did you do this? And I said. Well, Bob, 
you know Z was in the Cayman Islands, I do have the piece of 
paper. And Bob said. But, Manny, you didn't need to tell 
everything, or something — I want to be careful what I say 
here, but my recollection is he said. Well, we're 
disappointed. I certainly at no time — I once suggested to 
the Khashoggis that I was going to write a book to Bob 
Shaheen and he said. Go ethead. I mean, there's never been 
any— you know, saying. Don't say this or. Don't say that. 
I ' ve never been instructed in what to say or to whom to 
talk. I've kept a low profile because I've chosen to. 

Q Other than this one conversation with Bob Shaheen, 
any other conversations or communications regarding the arms 



iHWSSiPfl 



47 



Rashall Garcia • C«fiiflfld Shorthand Reporter - 



525 



transactions? Ul 1 ViLb lU v/^'i^a 'iU:^^ 

A No. 

Q And none with Mr. Fraser or Mr. Miller or any of 

his people? 

A No. 

(Exhibit 6 was marked for 
identification. ) 

Q (By Mr. Parry) I would like to show you Exhibit 6 
which you've looked at earlier during your testimony. Can 
you tell me what that is? 

A It's a photocopy of two business cards, one with 
the name of the attorney Graham May and the other with the 
Euro Commercial Bank offices. The second one is actually 
not a business card, it was a little clip that they would 
attach to things that they would give you, but that was 
where we would have our meetings in the Cayman Islands. 

Q And those cards were given to you in March in the 
Cayman Islands, March of '85 — or '86, I mean? 

A Yes, sir. Yes, March of '86. 

(Exhibit 7 was marked for 
identification. ) 

Q (By Mr. Parry) I'd like to show you what's been 



23 marked as Exhibit 7 which are three pages of handwritten 



notes, and I'd like you to identify those for me, if you 
can. 




Rashall Garcia • Centfled Shorthand Reponar • 



526 



ONCLASSIFiEi 



A These are photocopies of handwritten notes from my 
file which I prepared on the Khashoggi airplane flying from 
Kew York City to the Cayman Islands the morning of the 
meeting. These are three of several pages of notes that I 
made on the plane. 

Q This was on the plane from New York to the Cayman 
Islands? 

A (Nodding affirmatively.) 

Q Can you briefly go through and tell me what those 
notes say. 

A Well, I arrived in New York around eleven and about 
two or three in the morning they woke me up and told me that 
we were going to leave. We got to the airplane about four 
and when we got on the plane, Mr. Khashoggi outlined to me 
his situation. I had been told prior to leaving Salt Lake 
for New York that I was to be prepared to negotiate some 
additional financing on certain issues and I had brought 
with me a lot of facts about Triad America. 

He explained to me that he had obligations to 
Seirsvati totaling about $22 million dollars. 

Q Now, we're on the third page of the three? 

A Three pages. Then he told me he owed $56 million 
to the Sultan of Brxinei, including interest, that he owed 
Credit Commercial de France $10 million dollars and that he 
required a $10 million dollar revolving line for 






49 

It? 

Rashotl Garcia • C«fllfl«d Shorthand Rsportar - 



527 



JJSSi 



m^ ■ — 

International Marketing. 

We discussed the fact that he owned 80 percent of 
Triad through Triad International, and Triad International 
also had an interest in the — 

Q Was the third page the first page of your notes? 

A Well, there were other notes. We had these 
discussions on the plane for about an hour and then he went 
off and rested while I prepared some ideas and then he came 
back. So, we were having this discussion during the night. 
Then I was to put together some transactions in which some 
investor outside the company might buy an interest in either 
Triad America or specific projects. 

Q Now, this is the second page. Does that say 
"proposed deal"? 

A "Proposed deal," yes. 

MR. RADCLIFFE: Would you, Mr. Floor, please refer 
to certain pages and where you're talking in reference to 
your dialogue. 

THE WITNESS: On the second page of the document, I 
had four items that were sort of a little summary and the 
first was that an outside investor would buy a hundred 



22 percent of the Salt Lake International Center for $40 



million dollars and then Triad Property would manage for a 
fee and then do certain things as a developer, developer 
profit. That Sarsvati would provide AKW a $10 million 

RashrtI Garcia • C«rtifled Shormand Reporter 



528 




SSif© 



dollar line of credit and that Sarsvati might also lend 
money to acquire the Gilmore land. We went through a series 
of scenarios on the airplane, which we didn't end up 
discussing with the Sarsvati people, but I included this 
when you asked for the information because there was always 
this constant, you know, we need the $10 million dollar line 
of credit, and so it was on the notes. 

Q All right. Going back to the first item, do you 
know who the investor was? 

A Well, we were proposing that the investor in this 
case would be Vertex. 

We had another scenario in which the investor would 
be the Sultan of Brunei, whose name is mentioned on page 3, 
and Adnan explained to me that he needed to take advantage 
of the equity in Triad America to solve certain cash 
problems that he had and that we at Triad America had, and 
we went over our cash requirements again. We talked about 
our payables at Triad America and the loan we needed for the 
tower and our land debt amd the Sarsvati debt. 

This is where we got into the discussion about how 
much it was and his need for the marketing line. And so 
these notes are not all of my notes but do represent the 
notes in which the $10 million dollar marketing line was 
mentioned. 

Q The $10 million dollar marketing line appears 



UllftSSlfiEf 



' Rasholl Garcia • C«nifl«d Shorthand Reporter • 



529 



rather insignificant in relation to the various debts listed 
on your notes. Did he ever indicate why this relatively 
small line of financing was so crucial to his business? 

A Well, on the airplane going down, he indicated to 
me that this was a revolving line that was going to be worth 
a lot to him because he could do something over and over and 
over again. 

Q More than four times? 

A Well, he didn't characterize the number of times on 
the airplane and when we got to the Cayman Islands, when he 
talked about this Exhibit 4, he indicated at least four 
times, but I got the impression that this could go on, but 
four was the one he talked about. 

Q Because, according to his drawing, Exhibit 4, the 
four times would generate a profit of perhaps $8 million 
dollars but you got the feeling that he was looking at a 
much larger profit? 

A Yes, sir. 

Q But you don't know the details? 

A I don't. 

(Exhibit 8 was marked for 
identification. ) 

Q (By Mr. Parry) I'd like to show you what's been 
marked as Exhibit 8 which consists of nine pages, a front 
page of which — and subsequent pages — which appear to be 






RasMell Garcia • Cartflsd Stiormand Reporter • 



530 



nmss 



copies of your passport. Is that correct? 

A Ves, these are photocopies I made of my passport at 
your request. It does not include the front cover nor does 
it include all the pages, but it includes all the pages on 
which anything has been stamped and they are sequential 
through page 17 of the passport. 

Q And those pages, I assume, indicate your travel to 
the Cayman Islands and to Geneva in March? 

A Yes, sir. 

(Exhibit 9 was marked for 
identification.) 

Q (By Mr. Parry) I'd like to show you what's been 
marked as Exhibit 9. Can you tell me what that is? 

A Yes, this is a photocopy of an itinerary that was 
prepared by my secretary March 3rd for my trip to New York 
and subsequently to the Cayman Islands on March 4th. 

Q Was that a regular practice for your secretary to 
prepare an itinerary for each of your trips? 

A Yes. This particular trip, I was called on this 
trip the morning of the 3rd. That is, I was advised to get 
a plane and come back to New York. And she would put 
together these kinds of itineraries with all the detail for 
me so other people on my staff have a copy and my family and 
so on. 

Q Let's go off the record for a second. 



- Rashell Garcia • C«rtifl«d Shorthand Raporier ■ 



53 



531 






(Exhibits 10 through 13 were 
marked for identification.) 



Q (By Mr. Parry) Back on the record. I'd like to 
show you Exhibits 10, 11, 12 and 13 which I'd like you to 
look at and identify for me. 

A These are photocopies of docximents that were 
produced during the Cayman Islands meetings. Exhibit 10 was 
a guarantee by Triad America signed by me and by Triad 
International Corporation signed by Adnan Khashoggi 
guaran^pTig to Vertex the $10 million dollars, the $9 
million dollars, and the $21 million dollars, so, it's a 
brief guarantee. 

Exhibits 11 and 12 were acknowledgements by Adnan 
Khashoggi and then by Trivert that even though the demand 
loan — the $10 million dollar loan was a demand note, four 
months were to be given to pay it back, which would have 
meant the money was due back in July. 

Exhibit 13 is a copy of instructions to Euro Bank 
signed by Adnan Khashoggi, and I prepared this document. 
Mr. Khashoggi signed an original. Mr. Khashoggi, while in 
the Cayman Islands, opened a number of accounts for the $10 
million dollar loan to flow through. It was to flow from 
the bank to his account, this number, and from this account 
to the account of Trivert, which would also be at the bank. 
/// 






Rashflll Garcia • C«ftfflfld Shorttiand Reportsr ■ 



532 



\mmm 



(Exhibit 14 was marked for 
identification. ) 



Q (By Mr. Parry) I'd lilce to show you Exhibit 14, 
and could you identify that briefly. 

A This is a copy from my files of the letter from 
Larry Taylor, one of our officers at Triad America, to 
Mr. Donald Eraser dated January 13th. Mr. Eraser and 
Mr. Miller came to Salt Lake in early December. As a result 
of that visit, they asked for quite a bit of infonnation 
regarding the company, and this is a transmittal letter 
which sent on some or most of what was requested by 
Mr. Eraser. 

Q I guess we'll put that in too. 

(Exhibit 15 was marked for 
identification. ) 

Q (By Mr. Parry) Could you look at Exhibit 15 and 
tell me what that is. 

A This is a copy of a telex — a telex from me to 
Robert Sheiheen sent from the AK Utah telex machine in Salt 
Lake to Mr. Khashoggi's Paris telex machine. It is a telex 
regarding the Sarsvati transaction which was negotiated 
in New York City on October 30th which we discussed 
earlier. 

Eollowing the October 30 meeting, I got on the 
phone with Don Eraser and there were some issues — technical 



55 
M Sarcia • C«filfled Shonhand Raporter • 



iHCIiSS'lP 



533 



m 






issues — regarding the loan and this was a telex from me to 

Shaheen outlining the proposal made by Mr. Miller and 

Mr. Fraser. 

It took until the 15th or 16th of November to 

resolve these problems because they had to do with whether 

Mr. Miller and Mr. Fraser had an option to acquire stock or 

an absolute duty to take the stock. 

Q And, finally, let's mark this as Exhibit 16. 

(Exhibit 16 was marked for 
identification. ) 

Q (By Mr. Parry) Exhibit 16 is a four-page document. 
Can you tell me what that is? 

A This is a photocopy of a document prepared by me, 
typed by my secretary, which I prepared and sent to Adnan 
Khashoggi and to Essam Khashoggi and Tariq Kadri 
recommending that the transaction — the Triad America was 
falling apart because of what was happening through 
Mr. Miller and Mr. Eraser's operation. This is xindated. My 
recollection is I prepared it in April because of the 
subject matter. It looks to me like a document I prepared 
that led to the eventual disengagement of the Sarsvati 
people from Triad. It has a sentence underlined here, which 
I underlined, which says "and a third to provide $10 million 
dollars to finance marketing projects." That's my own 
emphasis. I added that before I gave you a copy of that. 



ishall Garcia • OrMed Shorthand Reporter - 



534 






Q That was subsequent to the — 

A Yes, it was not underlined at the time I did the 
document . 

Q Do you have a cover letter or anything that would 
indicate that this was in fact sent to Mr. Khashoggi, his 
brother and Tariq? 

A I don't have such a letter with me but I suspect in 
my files that I have a letter. 

Q Do you recall that it was in fact sent? 

A Yes, there's no question this was prepared and 
sent. 

Q In approximately- April of 1986? 

A Yes, sir. 

Q All right. Now, other than the 16 exhibits and the 
few other documents that you produced to me on Friday, to 
your toowledge, do you have any other documents that relate 
to the arms transactions that Mr. Khashoggi was involved in? 

A No, sir. I have documents that relate to the 
transaction in the Cayman Islands in general and some in 
specific but none which mention arms specifically. 

Q And none that would indicate that $10 million 
dollars was in fact funded? 

A No, sir. 

Q Let's go off the record for a second. 



/// 



ySWSSIFlEB 



Rasftell Garcia • Canified Shorthand Reporter - 



535 






(An off-the-record discussion 
was held. ) 



Q (By Mr. Parry) Mr. Floor, I would like to ask you 
about various individuals, and I want to know whether you 
know these people and know anything about their possible 
involvement in the arms transactions. Let's start with a 
Mr. Furmark. I believe his first name is Ron. 

A I believe it's Roy. 

Q Do you know Mr. Furmark? 

A I've met him. Mr. Furmark was in Salt Lake City 
for at least one of our Triad activities and I believe I've 
also met him either in Europe or in New York at 
Mr. Khashoggi's condominium. But our meetings were just,. 
Hello. I just know that he was an associate or friend of 
Mr. Khashoggi's. 

Q And you've never done business with him or been 
involved in a transaction in which he was involved? 

A No, sir. 

Q You know him through Mr. Khashoggi? 

A Yes, sir. 

Q Has anyone ever suggested to you that he was 
involved in the arms to Iran? 

A Only what I read in the newspaper. 

Q All right. How about Cyrus Hashemi? Do you know 
that man? 



iT'Ha aor-inrp 
y\%LRooli SCO 



Rasn«<l Garcia • C«ftifled Shoflhand Raportar - 



58 



536 






A I don't know the name, no. 

Q How about Albert Hikeem? 

A Again, only what I've read in the papers. It's not 

a name that I'm familiar with. 

Q And General Seccord? 

A Again, the same answer. 

Q Oliver North? 

A Same answer. 

Q John Poindexter? 

A Again, these are people I've only heard of. 

Q Other than the newspaper accounts— 

A That's right. 

Q — you've never met or heard of these people? 

A No, sir. 

MR. RADCLIFFE: Off the record a minute. 

(An of f-the-record discussion 
was held.) 

Q (By Mr. Parry) I believe in the Knight Ridder 
article that we've referred to, I believe that there was an 
indication—and it may be a different article — that there 
was in fact a $15 million dollar transaction to finance the 
arms deal and that it was not Mr. Miller or Mr. Fraser but 
another Saudi investor who provided the funds. Do you know 
anything about that? 

A No, the only financing I )cnow about is the proposed 

Rashrtl Garcia • Cartfled Shorthand ReportBf 



537 



iiLMdSFirji 



$10 million dollar financing joint venture. 

Q You don't know who the other Saudi investor 
referred to could be and you've never heard about a $15 
million dollar — 

A No. No, sir. 

Q Do you want me to as)c — with respect to that 
article, were there statements attributed to you which you 
did not make to the reporter? 

A Well, there were statements in the article which 
were not attributed to anyone and the way the article was 
written, it appeared that I had said them. Also, you're 
showing me a copy of the Salt Lake Tribune copy of the 
article. I'm not sure that was the entire article. 
Somebody told me that the article ran in the east was 
longer, but there are statements that I think — there are 
clearly statements which are attributed to me or to no one 
that sound like they came from me which I didn't make. 

Q Do you offhand recall what those particular 
statements ware, the ones that people may have attributed to 
you? 

A Well, there was some conclusions in the article 
about what Mr. Khashoggi did or didn't do with certain funds 
that I had no knowledge of and it implied that I had said 
certain things. 

Q Going back to Mr. Hashemi, who you haven't heard 







It 

Rashell Garcia • Cartifled Shorthand Reporter 



538 




about, there have been other criminal investigations of arms 
deals with Iran that Mr. Hashemi was involved in and other 
people who have been associated with Mr. Khashoggi. Did you 
know about any of those investigations or the criminal 
prosecutions at the time that Mr. Khashoggi was discussing 
this particular transaction in March of '86? 

A No. No, the only information I had about those 
transactions — I believe those came about sometime after May 
of '36. All I ]cnov about those transactions are what I read 
in the newspapers and I have talked to Mr. Evans and to 
Mr. Maynard Dose since they were both released about the 
situation just briefly as friends. I had no prior 
knowledge. 

Q Do you know Sammy Fadel? 

A Sammy Fadel, yes, I know Sammy Fadel. 

Q Have you done business with him? Tell me what his 
position is with Mr. Khashoggi. 

A Mr. Fadel is the managing director of the Geneva 
office of Triad. He offices in Geneva. Prior to that, he 
was in Luxembourg for Mr. Khashoggi. He was also in Paris 
for Mr. Khashoggi, and he was on the Triad America — he was 
on the AK Utah board in 1977. I believe he's still with 
Mr. Khashoggi. When I went to Geneva following the Cayman 
Islands, it was to his office I went and he was the person 
that kept all the records, all the financial and stock 



wmvm 



61 



Rashell Garcia • Carttfiad Shor«iand Raportar • 



539 






information in Geneva for Mr. Khashoggi. 

Q Would he have necessarily been aware of the $10 

million dollar transaction to finance the arms deal? 

A Well, I gave him copies of all three loan documents 
when I went to Geneva because he kept track of all of the 
obligations Mr. Khashoggi incurred, and since these were 
obligations of Mr. Khashoggi as well as obligations of Triad 
International, he needed those records. And it was his 

ffice from which I sent the documents which I sent back to 
this country for distribution. 

Q Were arms to Iran ever discussed in his presence — 
in your presence? 

A Not when we were both together. 

Q Do you know of a company named Kremdale? 

A No, sir. 

Q Or Galliot? 

A No, sir. 

Q Have you ever met a John Gamble, another Canadian? 

A I'm not sure . 

MR. RADCLIFFE: Don't speculate. 
THE WITNESS: I can't recall. 

Q (By Mr. Parry) You don't recall? 

A I don't recall. 

Q How about William Birchall? 

A I want to say the man is associated with Barrick 



uncus: 



»a i S!o rt i 



Rashell Garcia • Certtfled Shorthand Reporter • 



62 



540 



mrnmi 

Resources but — I believe he is. Mr. Birchall was one of the 
Barrick people. 

Q Have you had any dealings with Mr. Birchall? 

A Yes, I was on the Barrick Utah board and I assisted 
Barrick when they came to Salt Lake City, did certain things 
with the press and others, and I believe Birchall may have 
been involved. 

Q To your knowledge, did he have any involvement or 
any knowledge of the arms transactions? 

A I have no idea. 

Q All right. I'd like to ask you about Timothy Kahn. 

A Yes, sir. 

Q You know him? 

A Yes, sir. 

Q What was his connection with Mr. Khashoggi? 

A Mr. Kahn was a Canadian businessman, as I recall, 

and Mr. Khashoggi was interested in expanding, or was 

looking at possibly doing some things in Canada. When he 

went to Canada, Mr. Kahn made certain arrangements for 

certain meetings. I don't know much beyond that. 

& 
Q I take it he was not a former Khashoggi aic^? 

A Again, I don't know how — I'm not sure whether he 
ever worked directly for the Khashoggis or not. He may 
have. I met him on only one occasion. 

Q He was not in the Cayman Islands? 



msamm 



63 



Rashall Garcia ■ CarUflsd Shorthand Reporter - 



541 



um 



l^^^fffJ 



A No, sir, he was not in the Cayman Islands. 

Q To you knowledge, he had no involvement in the arms 

transactions? 

A No, I have no information that he did. 

Q But you think he was connected with Mr. Fraser and 
Mr. Miller? 

A No, I don't know that he was connected with Fraser 
and Miller. I just know that he was Canadian and that he 
arranged some meetings for Mr. Khashoggi in Canada. I don't 
know if those meetings involved Mr. Fraser or Mr. Miller. 

Q One name I left out that I wanted to ask you about 
was Mr. Casey. Was his neune ever brought up or have you 
ever heard his name mentioned in the presence of 
Mr. Khashoggi? 

A Not to my knowledge. Not in my presence. 

Q How about the various Israelis allegedly involved, 

hi ir c.h \ 

Mr. M t m r, Mr. Swimmer, Mr. Nimroday, any of those? 

A Not in my presence. 

Q Do you know — I believe it's a lawyer named 
Mr-. Evans . 

A There is a Sam Evans, Samuel Evans. I know Sam 
very well. 

Q Now, is Mr. Evans a lawyer for Mr. Khashoggi? 

A He was at one time. I have no idea what his 
present relationship is. Mr. Evans was associated with 



NCLASSIFIEO 



Rashell Garcia • C«rtfled Shorthand R«porter • 



542 



yHCiftSSii i iy 



Mr. Khashoggi for many years and, again, was on the Triad 
America board. 

For a period of time, he lived in Los Angeles and 
participated with us in our Salt Lake and Triad America 
operations. He left the employ of the company a few years 
back and went back to London where he set up a law practice. 
He did some additional work for Mr. Khashoggi following that 
but I don't know for how long and I don't know what his 
current status is with Mr. Khashoggi, if any. 

Q To your knowledge, was he involved at all with 
respect to the arms deal? 

A Well, he was not involved in — as far as I know, he 
was not involved in any of the things that we've talked 
about that I have any knowledge of. 

Q He was not at any of the meetings and his name 
didn't come up at any of the meetings? 

A No, sir. 

Q In any of your conversations with the people that 
were involved in the various transactions, did the subject 
of hostages ever come up? 

A No, sir. 

Q Did the subject of financing the rebels in 
Nicaragua ever come up? 

A Not in my presence, no, sir. 

Q And, again, I've asked this bef pre, but was there 



mumt^ 



■ Rashall Garcia • Certified Shontiand Reporter • 



65 



543 






ever any question or suggestion that the United States 
Government was giving approval to this transaction? 
A Not to my recollection. 

MR. PARRY: All right. Thank you very much. I 
don't have any further questions. 

EXAMINATION 
BY MR. RADCLIFFE: 



Q Please answer as briefly as possible. 

During the first quarter of 1986, did you form an 
opinion that Triad Utah and its various business were in 
financial trouble? 

A Yes, sir. 

Q When you traveled to New York to visit with Adnan 
Khashoggi, did you go there for the purpose of discussing 
those financial troubles as reflected in Exhibit 7? 

A Yes, sir. The exhibit was prepared on the airplane 
from New York to the Cayman Islands but I had lots of 
material with me relating to Triad America's financial 
problems. 

Q Was your principal discussion directed towards 
solving the financial problems of the company that you were 
president of? 

A Yes, sir. 

Q When you arrived in Grand Caymans and met with 
Mr. Fraser and Mr. Miller, did you discuss with them the 



«4;«^ v:«- tv^«> -''' ■' 



66 



Rashall Garcia • Carttflad Shormand Raportar • 



\ 



544 



ONCLASSIREB 



financial trouble of the company as outlined in Exhibit 7? 

A Yes, sir, and with other materials I had with me. 

Q In that meeting, it's my understanding that they 
agreed to fund those $9 million dollars toward certain 
liabilities of the company as reflected in Exhibit 7; is 
that correct? 

A Well, they redefined $9 million dollars of 
liability. There were other exhibits, including the loan 
they signed and including the documents which a^e not 
entered as exhibits, which I presented to them in the Cayman 
Islands spelling out specifically the $5 million dollar 
payable schedule and the $4.5 million dollar tower loan 
which are referred to in Exhibit 7. 

Q Looking at Exhibit 4— and when you discussed the 
four possible transactions evidenced by the $40 million 
dollar or the $40,000, whatever it reflects up in the upper 
right-hand corner of Exhibit 4, did you have any 
understanding as to how long each of the transactions would 
take place? 

A It was my understanding it would be a relatively 
short period of time and when we signed the loan dociiments 
and agreed on the repayment of four months, it was 
anticipated that the transactions would be complete in four 
months so that the money could be paid back. 

Q Was it your understanding that no more than $10 



mumm 



Rasholl Garcia • C«rtifled Shonhand Reporter • 



545 



U w- i 2 -' ■ ' -i 

million dollars of original loan would be required to 
accommodate the entire $40 million dollar transaction? 

A That was the way it was described, yes. 

Q Was the $9 million dollar loan required by Triad 
contingent at all upon the repayment of the $10 million 
dollar transaction now described as the arms transaction? 

A No, sir. 

Q Did Mr. Miller and Mr. Fraser understand that they 
were jeopardizing the company by not funding the $9 million 
dollar loan, and thereby their own security? 

A I believe that that's the point I made, but I don't 
know if they understood it. The point I made certainly was 
that the $5 million dollars in payadDles and the $4.5 million 
necessary to start the tower were both critical to the real 
estate side of Triad America successfully meeting the plan. 

Q So, they Icnew if whoever was to repay that $10 
million dollar loan through the arms transaction was not 
repaid, that the company would be in dire straits; is that 
correct? 

A Because they insisted that Triad America guarantee 
the $10 million dollar loan and the $20 million dollar loan 
and the $9 million dollar loan, I have to believe they 
recognized that the nonpayment of any one of them would 
have. A, given them the company; or, B, destroyed the 
company . 







Rashell Garcia • Orttfled Shorthand Raportar ■ 



546 






Q Did you feel that they had any idea in their mind 
at the time they made the Iranian arms loan that it probably 
wouldn't be repaid? 

A No. As a matter of fact, it was an interesting 
thing. One of the reasons Adnan personally guaranteed the 
loan is they raised the question — or one of us did — why 
can't you give the arms and then get paid before you pay for 
the arms, and vice versa. You know, why is it that — and 
Adnan made it clear that the parties had to develop trust 
for one another and that it was necessary for him to have 
the money to provide the vehicle of trust. He said, I 
guarantee it will be repaid; therefore, here's iny stock and 
here's my Barrick Horshem interest and here's my guarantee, 
and if you don't get paid, I'm the guy that suffers. So, 
the question came up and he assured them that he would 
guarantee payment. 

Q You knew of Mr. Khashoggi's prior arms history; is 
that correct? 

A Yes, sir. 

Q Did it seem strange to you then that they would be 
discussing arms at that meeting? 

A Well, it surprised me when it came up because I — on 
the airplane he had told me five, six, seven times how 
important it was to get the $10 million dollar marketing 



loan and he kept referring to it as a loan to facilitate 



WXm 



^t^ 69 



Rashatl Qorcia • C«rtlfl«d Shorthand Reporter - 



547 



missfe 



some very important marketing transactions and that he had a 
series of, transactions and that he needed a revolving line 
of credit. 

It was not until we got to the Caymans and we were 
discussing how to structure the transaction and he drew the 
chart that I understood that arms were being shipped to 
Iran. It surprised me that he brought it up then and hadn't 
brought it up on the plane, but we had never — there was 
never a time when we had ever discussed the actual 
involvement in arms sales, but I was aware that he had been 
involved. I mean, he didn't like being referred to as an 
arms dealer. He would become very upset about that. And 



13 his brother, Essam, was very upset. They wanted to be 



referred to as brokers and merchants and business statesmen. 
He was always interested in being referred to as a merchant 
statesman. 

Q Mr. Khashoggi was also involved in the oil 
business, was he not? 

A He was in the Sudan and elsewhere. 

Q Did you discuss oil when you met with the Sultan of 
Brunei? 

A Yes, there was some discussion eibout the 
possibility of the Sultan making availzible some crude oil 
for use in the acquisition of a refinery. 

Q Was the Sultan of Brunei concerned about the world 

Rashall Garcia • Cartlfled Shoritiand Reporter - 




548 



UraSSft! 



market price of oil during your meeting with him? 

A I don't recall. 

Q Do you recall hearing in the newspaper that the 
Sultan of Brunei actually funded $10 million dollars to the 
Contras? 

A Yes, I read in the newspapers that story, yes. 

Q Did that seem strange to you? 

A Well, nothing has seemed strange to me since all of 
this began. 

Q Did you connect it at all with your discussion 
concerning the oil prices and — 

A Well, let's put it this way: I've been very 
curious as to the relationship of the Sultan of Brunei, the 
Guru or Swami, as he was called, Mamaji, Swamiji, 
Mr. Miller, Mr. Fraser. I think there's a whole network of 
involvement there that I don't fully understand. So, it 
didn't surprise me that the Sultan of Brunei and the Saudi 
name and the Khashoggi name and the Canadian names all came 
up. It seemed to me to be sort of an interesting fit. 

Q Thank you very much. 

MR. PKBRY: I would like to follow up with one or 
two questions. 

FURTHER EXAMINATION 
[BY MR. PARRY! 



You mentioned the trust required to do this deal, 




ii jLU 



msl^l Garc« • C«rtMed Sherttiand R«ponar -«»- 



549 



IPSSiFlEI 

1 nr. Khasnoggi ever ir 



the arms deal. DidHr.'i?fiash6ggi ever indicate, give an 
indication of the trustworthiness of Mr. Gabonafar? 

A Well, he indicated that he had a number of 
associates in this chain and that he was dealing with these 
people and that he had dealt with these people and that he 
needed to put certain money — certain of the profit had to 
move to this entity in order to satisfy Mr. Gabonafar and 
others, and he suggested that — when we had this discussion 
about how do we know we'll get our money — I mean, why would 
we want to buy arms that we may not be able to sell, and why 
would we want to deliver arms that we may not get paid for, 
His comment was. Well, we've been working with these people. 
And I want to be careful how I recall this, but my 
recollection is he said. We've worked with these people and 
we can trust them. But it was clear that Adnan Khashoggi 
had to have the money available to make this thing flow, 
that he was the designated supplier of funds. 

Q Now, you've said he said, We've worked with these 
people. Was he referring to Sab o n »fcar? 

A. 

A He said. These are people we know and this is the 
only name on the page and so this man was not a stranger to 
him. 

MR. RADCLIFFE: That man was on the page. 

Q (By Mr. Parry) So you don't know specifically who 
he was referring to or in what context he had worked with 

yNCLftSSIFlEO 



Rasnell Garcia • Canifled Shorthand Reporter - 



550 



them before? UIIULH^^Ol H sl D 

A No, sir. 

Q Same question about Mr. Miller and Mr. Fraser as to 
trustworthiness. Did Mr. Khashoggi indicate great trust in 
those individuals? 

A Well, Mr. Khashoggi was constantly referring to 
Mr. Miller as his partner in all of these transactions, in 
the transactions in late October, in the transactions in 
March, in all of these situations. He was always referring 

o Mr. Miller as — that they were partners. As a matter of 
fact, when we were going to meet in Geneva, Mr. Kadri caune 
over and he and I met with Mr. Khashoggi prior to the 
arrival of Mr. Miller and Mr. Fraser and Mr. Khashoggi 
suggested that his perception of all of this was that he and 
Mr. Miller and Mr. Miller's associates were going to be 
50/50 partners in everything, in Triad America, in the 
marketing, in everything. It was sort of a together we will 
solve all of these problems and we will be partners, and we 
laid out some notes and prepared some ideas 2ibout how that 
partnership might work, which was really sort of more of the 
same information that we described on the airplane flying to 
the Cayman Islands. 

It was my impression that Mr. Khashoggi was 
anticipating that Mr. Miller and Mr. Miller's wealthy 
associates were going to be able to solve a lot of 



■ Rashell Garcia • Certfled Stiorthand Reportsr ■ 



73 



551 



I 
I 

Mr. Khashoggi's problems 






Q Was that his main asset that he brought to the 

partnership, his wealthy associates, or did he have 
particular expertise in solving business problems? 

A Well, I always felt that all he had were wealthy 
partners. He said he had expertise. 

Q Do you know anything about his background? Does he 
have unusual qualifications? 

A My experience with him is that his qualifications 
are not apparent immediately. He explained — I mean, there's 
no question he seems to be able to deliver funds. His style 
of doing lausiness is not my style. To say it's right or 
wrong would probably be — you know, it's certainly not a 
style I'd employ. It's a management by intimidation style, 
and that's one of the reasons I resigned. He claims to have 
been very successful in all the things he's done. I have no 
direct knowledge about what ha's done or hasn't done. He 
obviously appears to control a considerable amount of 
wealth, but whether that's his wealth or other people's 
wealth, I don't know, but he has control over substantial 
funds . 

Q One related area. 

Are you presently involved in any litigation with 
Mr. Miller or Mr. Fraser or Mr. Khashoggi? 

A No. I'm a creditor to the bankruptcy proceeding of 






74 



RasnatI Garcia • Carttfled Shorthand Raponar • 



552 



Triad America. Triad America and many of the real estate 

companies were placed into Chapter 11 BanJcruptcy Proceedings 

in February, late February of this year, and I am a 

creditor. X have not been sued by nor am I presently suing 

them. I have filed a creditor's claim in the Bankruptcy 

Court. I have been subpoenaed as a witness in a couple of 

instances in matters relating to Triad and others, but 

that's the current status and situation. 

Q All right. This time I'm really finished. 

MR. RADCLIFFE: So am I . 

(Whereupon, the taking of this 
deposition was concluded.) 




Rastiell Garcia • C«rlifled SHorlhand Reporter • 



553 




STATE OF 



COUNTY OF Salt Lake ^ 

I HEREBY CERTIFY that I have read the foregoing testi- 
mony consisting of 7 5 pages, niunbered from 3 to 7 5 



inclusive, and the same is a true and correct transcription 
of said testimony, with the exception of the following cor- 
rections listed below, giving my reasons therefor. 



Page Line 


Change/Correction 


Reason 















































































































EMANUEL A. FLOOR 

Subscribed and sworn to at 



this 



day of_ 



, 198 . 



My cononission expires: 



Notary Public 



,»■)(•/" ^;> 






554 



mm K^w.^.^^ 

CERTIFICATE 



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STATE OF UTAH ) 

) 

COUNTY OF SALT LAKE) 



I, Rashell Garcia, a Certified Shorthand Reporter 
and Notary Public within and for the County of Salt Lake 
and State of Utah, do hereby certify: 

That the foregoing proceedings were taken before me 
at the time and place herein set forth, and were taken 
down by me in shorthand and thereafter transcribed into 
typewriting under my direction and supervision: 

That the foregoing 75 pages contain a true and 
correct transcription of my shorthand notes so taken/ 

IN WITNESS WHEREOF, I have hereunto subscribed my 

name and affixed my seal this 12th day of June 

19 87. 



My commission expires: 
December 15, 1988 





Rashsll Garcia ■ Cartlflad Shorttiand Raponsr • 



555 




556 



mmim 



TESTIMONY OT^/j/Zf/ff/^jj^SBtf^ 

2 Friday, May 8, 1987 

3 United States Senate 

4 Select Committee on Secret 

5 Military Assistance to Iran 

6 and the Nicaraguan Opposition 

7 Washington, D. C. 

of ^|^HHH|^^^^^^mm called 

9 as a witness by counsel for the Select Conunittee, at the 

10 offices of the Select Committee, Room SH-901, Hart Senate 

11 Office Building, Washington, D. C. , commencing at 9:45 

12 a.m., the witness having been duly sworn by MICHAL ANN 

13 SCHAFER, a Notary Public in and for the District of 

14 Columbia, and the testimony being taken down by Stenomask 

15 by MICHAL ANN SCHAFER and transcribed under her 

16 direction. 
17 



Partially Decla:sified/Released on 



/a--?3 -i^7 



under p.-ovirc-s of E.O. 12356 
by N. Slsnan, National Security Council 



•s?*i 




557 





Cjl 2 

b 

1 APPEARANCES: 

2 On behalf of the Senate Select Committfe on Secret 

3 Military Assistance to Iran and the Niearagi^p: ^~ _ 

4 Opposition: 

5 DANIEL FINN, ESQ. 

6 On behalf of^the Central Intelligence Agency: 

7 KATHLEEN A. MC GINN, ESQ.^ 

8 Assistant General QgunBel '-• ^ 

9 Office of General Counsel a^ 

10 T-. 'RHONDfcM. HUGJ^j, ESQ.--; ^ 

11 Legislative Counsel ^^^. .^^ 

12 Of fjtei^of"^E«agressioi^i Affalrt- " ^' 

13 "~-"- ' CentraU^Int«lligence Agency ""JPp ^^sr 

14 Washington, D. C."- aoSoBF"^ " -# 




UNCUSSIfe 



558 



UNCUSSIfllD 



1 


CONTENTS 


2 


EXAMINATION ON BEHALF OF 


3 


WITNESS SENATE 


4 




5 


By Mr. Finn 4 


6 


EXHIBITS 


7 


H^^H EXHIBIT NUMBER FOR IDENTIFICATION 


8 


1 10 


9 


2 38 


10 


3 ' 54 


11 


4 58 


12 


5 60 


13 


6 61 


14 


7 89 


15 


8 122 


16 


9 124 


17 





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PROCEEDINGS 



Whereupon, 



called as a witness by counsel on behalf of th*38enate 
Select Committee and, having been duly sworn, further 
examined and testified as follows: 

EXAMINATION ON BEHALF OF THE SENATE COMMITTEE 
BY MR. FINN: 

Q ^^HHH^H I'd 3ust like to revi«w tlM^ facts 
that you gave to us last time when we had aiv interview, 
which I believe was on April 15 of '87, as we were just • 
discussing, and we'll just establish the recent years of 
your career with the CIA and the circumstances that led 
to youirlSeparture and your activities since then. 

A Okay. 

Could you state your full name for the record? 



-And have you ever used any other name? 
In the Agency? 
Yes, sir, at any time. 
In the Agency I have, yes. 
Have you used any other naa% since your 
departure from the CIA? 

A No, I have not. 

Q What is your current address? 

K 



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Q What is your current employment status? 

A I'm not employed right now. 

Q Are you under any form of contract or retainer 
arrangement with any organization? 

A I am not. 

Q That includes *ny Agency of the U.S. 

Government? 

A Precisely. 

Q Do you have any employment relationship or 
contractual relationship with any individual, either an 
official or nonyofficial of the U.S. Government? 

A Not at this point, no. 

Q Have you had any contractual relationship wit^^ 
any individual who was formerly an official of the U.S. 
Government during the period after your departure from 
the CIA? 

A No, I have not. 

Q By contractual agreement I would mean an 
agreement under which you would provide services and be 
paid some fee or receive some other consideration in 
return . 

A No, I have not. 




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Q During that period did you have any contact* 
with Oliver Korth? 

A I had o«« csntact with Oliver North in Ai^ust 

of 1984^^ 

very brief contact. Basically I met him. 

Q We'll get to that later as the story unfolds. 
And that was the only time? 

Ics 




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10 



1 A That was the only time I met him. 

2 Q I have here and I'd like to have the 

3 transcriber enter this as ^^^^^Hsxhibit Number 1, some 

4 notes which we know to have come from Oliver North's 

5 files or safe and which we believe to be Oliver North's 

6 notes, and these appear to be a Xeroxing of various 

7 scraps of paper, whether the original all appeared on 

8 one sheet, I don't believe. They seem to be copies of 

9 index cards. 

10 (The document referred to was 

11 marked^^^^^BExhibit Number 1- 

12 for identification.) 

13 Let me call your attention to the bottom right 

14 quadrant of that. It would appear, would it not, that 

15 your name is listed^ 

16 A Right. 

17 Q Does it also appear to you, as it does to us, 

18 that other CIA personnel in the various countries during 

19 a certain period are listed in connection with those 

20 countries? 

21 A It does indeed. 

22 Q Can you identify the date of this list based 

23 on the assignments and names of the personnel listed 

24 during that time, at least in an approximate fashion? 

25 A I would imagine that this was during that 



letASSIflED 



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11 

period that we met in August, to the best of my 
knowledge. 

Q So these individuals -- ^s^ ^^ 

A And they got the name 
there. There's a question mark on the copy there, for 
obvious reasons.' It looks like(^^^Hsometh£|ag. 

Q ^'^^^^^H ^'™ ^°^ sure, ^o you r«call? 

A No, I don't. 

Maybe^^^^^^^^H Is— Unfe 

A 'Not that I'm auare of. Is ^^^^^■mp^9^«3'^, 
here? - 

Q ^ No ,fl^^^^ldoes not appear to be ;>ent^ned . 

A Weli^jwiyway, I'm not avara of 

jy th^ name. - ~\ 

Q During this period that we were just 
discussing, let's say approximately August of '84, was 
there an individual name 





A ^H^^^^^^^l I couldn't tell you specifically. 
The name rings a bell, but I can't honestly tell you 
specifically. 

Q How aboui 

Would that be current for that period, 
approximately August of '84? 

A Yes. 




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Q Do you have any explanation for why Oliver 
North would have written your name on a list of CIA 
personnel? 

A Well, I imagine that as he attended at least a 
port ion^^^^^^^^^^^^^^B- - 

he was the names ^^^^^^^^^^^^^^^^^| at 
point, or at least^^^^^^^^Hpersonnel — not that all 
on this attendedl^^^^^^^^^^^H to my Icnowledge. 
But obviously some of them did. 

Q ' But, at any rate, you have no other 
explanation why he would have put your name on it? 

A Not at all. ' ^^^^^ 

Q All rigfit. ^TbanJ#=you. "^ 

At what period during ybur servicej 
did you first become aware that Director Casey was 
considering you for a special assistant type assignment? 

A I became first aware of that, I believe, in 
June of '85. I received a cable — I think at that 
period; I'm not exactly certain of the date, but I think 
it was in June — that with regard to my next assignment 
I was summoned to come to headquarters. Kow at that 
point I didn't know what that was all about, but I came 
within the next couple of days and at that point I was 
aware that I was being considered for this job. 

Q And who did" you see? Who gave you that ^ 



ilNW«0 



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information? 

A I saw — the first person I saw on that was Ed 
Juchniewicz, who was the Associate Deputy Director of 
Operations, who told me. 

Q I see. Were you instructed to see Juchniewicz 

or did you find your way there, as it were? 

A I think I was instructed to. I think I 
probably checked in with the Task Force or the Division 
chief, but I cannot tell you exactly. 

Q Did you then see Casey to discuss the 
assignment? 

A I did, yes. 

Q What was the nature of the discussion you had 
with Casey at that time? 

A Well, we sat down and I think initially I 
might have been a little bit confused or at least maybe 
confused a little bit in the first session, but we talked 
at that tine about^^^^^^^fspecifically. He wanted my 
views on the various activities that were going or 




:he general 

questions that I'm sure the Director would normally ask. 
And it was at this point that he specifically 
asked me if I was interested in the job of being 
Executive Assistant to him. 



UHtt^SIBED 



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Q During your first meeting with Casey, was this 
— am I correct in believing this would be June or July 



of '85? 



I believe it was July. 



568 



1 Q This would now be July? 

2 A Yeah. 

3 Q You had heard in June that you were under 

4 consideration; then a few days or weeks later you 

5 proceeded up in response to that? 

6 A Precisely. I'm not absolutely certain of the 

7 date, but I'm almost certain it was June or July. 

8 Q Was there specifically a discussion with Casey 

9 in that first meeting on the status of the armed 

10 resistance? 

11 A No, not specifically at all. I did mention to- 
la him at that point that I had considered resigning from 

13 the Agency but that the humanitarian aid bill had just 

14 passed, I believe in June -- perhaps it was a little bit 

15 earlier — and I told him as we were chatting, I said I 

16 felt that that changed my opinions in terms of 

17 specifically resigning at that time. 

18 But we didn't speak specifically on the armed 

19 resistance at all, other than to mention the fact that 

20 none of the humanitarian assistance was being received. 

21 Q How did you account for, let's say, your 

22 consideration of resigning tp assis4te' — I presume to 

2 3 assist the armed resistance in some way; is that correct? 

24 A Yeah. Well, I felt very strongly about 

25 helping them to the degree that orLS could legally, and so 



n to the degree that or 



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Q How do you account for, let's say, the 
strength of your feelings and commitment to the cause of 
the armed resistance even though you had had no chance, 
let's say, to assess them directly? 

A Well, I was certainly aware from a variety of 
sources, I was quite aware of the fact that they were 
probably not doing very well, for one, and I was also 
very directly aware of the fact that the buildfup, 
Sandinista buildfup, was going very strong, particularly 
on the Soviet side, and it seemed to me that the armed 
e:ci 



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resistance probably was not doing very well. 

Q Was that, let's say, your primary motivation 
in believing that the armed resistance needed to be 
supported, namely that the Soviet and Cuban consolidation 
and build-up was proceeding very rapidly in Nicaragua? 

A Well, that was certainly one, definitely one 
of my perceptions, of course. 

Q Did you also see a political dinensioir, that 
the armed resistance was a necessary adjunct to, let's 
say, political opposition to the Nicaraguan regime? 

A "^"^ An adjunct? What do you mean by "adjunct"? 




Q Had you reached a conclusion that the unarmed 
opposition had to be supplemented by an armed opposition? 

A No, not necessarily, although certainly I 
think there was an unspoken feeling that if indeed the 
armed opposition failed or disappeared or was not there 
that the unarmed opposition probably would not be able to 
exist as such. That's not demonstrable, but the armed 
opposition certainly served in some regard. 




571 



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^^^^I^H^^^^^^Hthe armed opposition certainly did 

2 represent to some degree a rallying point for people who 

3 were dissatisfied with what was going on in Nicaragua 

4 particularly with the regime. 

5 So there was an unspoken tie, I think, with 

6 regard to that.- But I always felt it was very important 

7 that some armed opposition exist. 

8 Q And believing that the armed opposition needed 

9 ■ to be supported through various means, what objectives 

10 did you smpport for the armed opposition? Did you 

11 believe that they should overthrow the government of 

12 Nicaragua or that they should cause some political change 

13 in Nicaragua? What were your intentions, let's say, for 

14 the movement that you wished to support? 

15 A Well, I think specifically what I would liked 

16 to have seen was that the armed opposition as such would 

17 at least minimally put enough pressure on the Sandinista 

18 government to, if there was changes that they were going 

19 to make within the internal system, that one nMded 

20 obviously Jthat kind of pressure. So I think that my 

21 feeling with regard to the armed opposition was that that 

22 was very critical, particularly for U.S. policy 

23 interests. _■ ~ . ^ " "^- « 

24 Q Did you discuss the objectives that you saw 

25 for the armed opposition with Casey during that first 



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meeting? 

A No, I did not. 

Q Did Casey make any statements concerning what 
he felt the role of the armed opposition was? 

A Ko, he did not. 

Q Did you feel you had reached any understanding 
with him about the armed opposition — let's say that it 
needed to be supported all the way or only part way? 

A No. Wa didn't speak about tils' armod 
opposition. 

Q Let's go back, if we can, to a point you 
mentioned earlier, 

Now that was in August of '84;'1« that 

correct? 

A That's correct. 

Q What was the purpose 

A Well, the purpose^^^^^^^^^^^^^^H — it was 
my understandiijg it's general policy to usually have a 
meeting ^^^^^^^^^^^^^fperiodically within 
regions, geographic regions, of the world, and this 
indeed was certainly one of them. 

Q Did senior CIA officials attend ^^^^m 



Who were they? 





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A Mr. Casey, obviously; Dewey Clarridge.^^^^^H 
the Deputy Director of 
Operations, Clair George. 

Q ^^^^^^^^Hwas not yet in his position and was 
therefore not there; is that correct? 

A Yes. 

Q Was ^^^^^^^Hthere by any chance? 

A H^^^^^^^^H No, he was not there, my 
knowledge. 

Q ' I believe you m*ntione4 in your previous 
interview that Oliver North also atCSfided ^^^^| 



A Indeed, he did. 

Q You are quite certain in your recollection 
attended ^^H||^^^^H 

A Well, I )cnow he was there, at least sitting in 
the room initially, either when we came in to meet with 
the Director or he came in soon thereafter. I cannot 
recall how long he stayed specifically. I know that he 
did speak at a certain point. 

Q So North wa« actually present during one of 
the sessions ^^^^^^^^^^^^^^^^^^^^M 

A The primary session, exactly. 

Q . And what was the nature of the primary 



session? 



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A Well, it was basically to give the Director, 
as I was told, an overview of the various countries 
^^^^^^^^^^^^^^H that were represented! 

Q So it was the format to go around the table, 
as it were, with thei^^^^^^^^^|^|brief ing the Director 
on the issues 

A Precisely. Not necessari] 
but to the country itsell 




Q NoKrdid Ollie North speak ta^t all dvtflng 
that session? "^ -= -^^ "-^^ 

A He did/ y^^ He jiid mfl||ti<ak — I 'can't to my_ 
recollection telir you exactly what he said, i^ I do 
recall that he was speaking particularly with regard to 
Nicaragua, but his specific statements, in all fairness I 
couldn't specifically say what they were. 

Q Do you recall did North make statements 
concerning the probability of renewed Congressional 
support for the resistance? 

A I don't recall him ever saying anything like 
that. 

Q Did North discviss the Soviet and Cuban buildup 
in Nicaragua? 

A He may have mentioned it, but again to the 



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best of my recollection I can't specifically say that he 
did. We certainly talked about it. 

Q What was the main point or thrust of your 
presentation^^^^^^^^^^^^^^H Do you 

A Well, yes. I'd have to go back in my memory a 
little bit. That was quite a while ago. But obviously I 
gave the Director an overvie 




I really would have to review in more detail 
what I said. I really haven't thought about specifically 
what I talked about, but I think I gave him a general 
overview. 

Q Do you recall Oliver North interjecting during 
your presentation and discussing some of those points? 

A Well, I do recall him saying something as I 
was speaking, yes, but to tell you the truth I couldn't 
tell you specifically what his question was or if he was 
elaborating on something that I said. I don't recall 
specifically. 

Q Would you ag»e«^that Ollie North is a rather 
animated individual? 

A Very much so — passionate, very articulate. 

Q Do you recall when he spoke up that it was 



!l 



576 



UNfitASSW 



23 



1 with some animation and therefore difficult to ignore? 

2 MS. MC GINN: Object to the question. 

3 BY MR. FINN: (Resuming) 

4 Q All right. Did he speak in an animated 

5 manner, do you recall? 

6 A Did he speak in an animated manner? I would 

7 say he probably did. 

8 Q Did he speak at some length? 

9 A He probably talked for a minute or two on 

10 various topics, but nothing — '^"^ 

11 Q Was the nature of the proceedings such that 

12 there was a fairly, let's say, good degree of 

13 concentration and the participants were more or less 

14 listening to what was transpiring? 

15 A I think we were all sitting around waiting to 

16 give our own talk and probably weren't thinking too much 

17 about what the other person was saying. 

18 Q Did you find it surprising that North was 

19 permitted to attend the primary session] 

21 A Well, I'll tell you the truth. Yes, I suppose 

22 I did find it a little surprising. On the other hand, 
that was |^^^^^^^^^^^^^^^^^^|^^l We the 

24 Director there. I don't recall that I specifically knew 

25 who Ollie North was at that time. I think I knew he was 



UimtSSIflED 



577 




1 

2 

3 

4 

5 

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7 

3 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



24 

on the NSC, but I didn't find it surprising, given the 
fact that the Director was holding ^^^^^^^^^H that 
he would have somebody there. So it wasn't a total 
shock, but I must say I was a little bit t^ken aback. 
Q Were you introduced to North at some point 

A I introduced myself to him and, quite frankly, 
I may actually have met him possibly the night before. 
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^H had a 
party for us, all of us, and I cannot recall if possibly 
Mr. North may have come to that party, just passing 
through. 

I know that he was late^^^^^^^^^^^^H I 
remember him mentioning that he had come in late and at 
one point I introduced myself to him and asked him who he 
was. 

Q So your recollection is that you introduced 
yourself to North at the cocktail party? 

A I'm not so sure. I just remember introducing 
myself. Whether it was^^^^^^^^^^^^Has he came in 
or possibly at the party just before! 
that night, I'm not clear. But at one point I just said 
hello to him. 

Q Did you have an understand ijig whether North 
came along with the delegation 'of senior CIA officials or 




ltNW«D 



578 




25 

1 whether he came separately? 

2 A As I recall, he came separately. ' I think he 

3 said he either missed the plane or he had come down there 

4 on his own, or at least not with th«rT)irector. 

5 Q Was North acco«paniedjby anyone during his 

6 attendance at' the cocktail party? 

7 A Not to m^^^cnowledga, if i^js&d he did att«M 

8 the cocktail party. But he was not accompanied by anyone 

9 either at the cocktail party that I knew of, if he was 

10 there, or bertainly^^^^^^^^^^^Hwhen we were there. 

11 Q Do you recall^^^^^^^H^Hhaving been in 
attendance at the primary sessior^l^^^^^^^H^^^H 

13 A Yes, sure. 

14 Q Was the nature of that session such that, 
say, ^^^^^^^^^^^^^^^^^1 all the 

16 stayed throughout at least that session? 

17 A To the best of my recollection I think all of 

18 us did. There might have been — I think even the 

19 Director excused himself a few times. We were in 

20 basically a vault something like this 
^^^^^^^^^^^^^^^^^^^^^^H and the whole 

22 most of the morning, as I recall. Mo»t people were 

23 there. 

24 Q The session was conducted in a fairly small 

25 room? 



\l»kS^^ 



5T9 



1 

2 

3 

4 

5 

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7 

8 

9 

10 

11 

12 

13 

14 

15 

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19 

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21 

22 

23 

24 

25 



umssifa 



26 



A Yes, reasonably small. 

Q What was the total number of participants? Do 
you recall? 

A Well, I can tell you that the Director was 
there and Clair George was there. Dewey Clarridge was 
there. Are you counting? I believe — I'm not sure of 
this — that a DDI officer was there as well, Deputy 
Director of Intelligence officer. 

Q Would that have been Bob Vickers? 

A ' I think it was Bob Vickers. Obviously myself, 




Q So let's say roughly a dozen people were in 
the room? 

A I would say something like that. 

Q I think you actually mentioned eleven. Let's 
say a dozen just for argument. And the room was a fairly 
small one, you said. 

A It was probably a little bit bigger than this, 
but I can't recall. 

Q Just asking you to exercise your powers of 
recall, was everyone ai^r;aye<l. i^.SiifA * single table? 
lei 






580 



27 

1 A I think we had a big table and I think people 

2 were sitting around in a rather horseshoe fashion, and I 

3 think the Director was sort of at the head of the table, 

4 if I'm not mistaken. 

5 Q And what was the approximate size of the room? 

6 Can you use this room as an example? 

7 A I would say it was certainly bigger than this 

8 room. 

9 Q Let's say 25 by 15? 

10 A ' I didn't measure it, of course. I would say 

11 it was maybe one and a half times the size of this room. . 

12 Q And this room, be it noted, is, would you 

13 agree, approximately 12 feet by 25 feet? 

14 A I'll give you that. 

15 Q And in fact I think those are the actual 

16 dimensions, since I arranged for this room. 

17 A It was bigger than this room, but it was not, 

18 you know, 15 times bigger. 

19 Q Just as a parenthetical, I consider this room 

20 one of my great victories, since I was the person who 

21 found this in a warehouse in Virginia. Thanks for that 
description ^^^^^^^^^^^^^H 

23 Just one more question on that. Was there, 

24 since this was obviously a period of some ferment in the 

25 management of Central American programs, particularly the 



imisn 



581 



mmwi 



28 



1 contra assistance program, which I believe was referred 

2 to as thef^^^^^^^^B program, was there any discussion 

3 of, let's say, the phase-out of support for the contras 

4 and the modalities of CIA activities with respect to the 

5 Nicaraguan resistance in the future? 

6 A No, there was not, certainly to the best of my 
knowledge^^^^^^^^B^^^^^^^^H In other 

8 during the period when we were in that room together this 

9 was basically overviews of the situations within the 

countries ^^^^^^^^^^^^^^^^^^^^^^^^^^H but 

11 I don't recall any specific talk, although there could 

12 possibly have been, about the lack of aid or the armed 

13 resistance as such. 

14 Q Was there something in the nature of a 

15 valedictory statement by Dewey Clarridge at this time? 

16 A No. As a matter of fact, to my knowledge — 

17 at least I wasn't aware that he would be leaving or at 
13 least that he would be changing jobs at that point. So, 

19 as I recall, in my view I wasn't terribly close to him, 

20 so I don't recall any statement by him at that point. 

21 Q Was there any discussion by any of the senior 

22 officials there, or indeed by any of the officials there 

23 concerning what the policy should be toward, let's say, 

24 contacts and support of the contras themselves? 

25 A Not to my recollection. 



yRClKSSIftfD 



582 




29 

1 Q Let's go back, then, to the period in which 

2 you are feeing considered for the — now the precise 

3 position, I take it, for which you were being considered 

5 Executive Assistant to the Director? 

6 A That's correct. 

7 Q The Director also had other, let's say, 

8 special assistants, did he not? 

9 A Yes. 

10 Q What were their titles? 

11 A Special Assistant to the Director. There was • 

12 also — that ^^sfl|^^|^^|H ^^ 't^a^ point. And there 

13 was ^^^^^^^^^B whose title was, I believe, Executive 

14 Secretariat or head of the Executive Secretariat at that 

15 point. 

16 Q Sometimes referred to as the Executive 

17 Secretary? Would that be correct? 

18 A I think so. 

19 Q Well, here it is, July '85, and you are 

2 brought back to consider taking this position. Was that 

21 actually the time when you were chosen and appointed to 

22 that position? 

23 A Not technically, no, but the Director asked me 

24 if I was interested in the job and I said that I thought 
2 5 I would be, and he said, well, you think about it and let 



UNCllSSimD 



583 



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2 
3 

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5 

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15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



CWK^SS/ftffl 



30 



me know. And that's indeed what I did. I think I 
probably accepted the job at the end of — early August 
perhaps it was. 




Q Did Casey offer you the position during that 
meeting? 

A ' Yes, essentially he did. He didn't say will 

you take this, but obviously he was offering the job. 

Q I see. So shortly thereafter you were 

informed that he had selected you? 

A Yes, I was. 

Q And you accepted? 

A Yes, I did. 

Q And who was the channel of communication for 
that offer and acceptance? Do you recall? Was that 
through ordinary channels? 

A I believe it was, yes. 

Q Would that have come through, let's say — 

A Probably throughl 

Q Who was the Division Chief at that time? 



Yes. 



Was 



finvolved? 



uNttussra 



584 



UNCUSStFIo 



31 



1 A I don't believe he was, no, not in the 

2 communication. It comes in a cable, so you don't know. 

3 Nobody signs it. There's no signature on the cable. 

4 Q When did you then return to headquarters to 

5 take this position? 

6 A I came back approximately at mid-August — to 

7 come home, not to accept the position at that point, or 

8 not to assume the position, but to take a little bit of 

9 home leave, get my family established. And then I 

10 started the job of Executive Assistant I believe it was 

11 probably the first or second week of September of '85. 

12 Q Shortly after arriving did you have any 

13 discussions with the Director concerning the nature of 

14 your responsibilities? 

15 A No. He just told me to keep him out of 

16 trouble. 

17 Q Did you periodically have privatft discussions 

18 with the Director while you were serving as Executive 

19 Assistant? 

20 A Not very many. Obviously occasionally. 

21 Q I presume you had snippets of conversation 

22 from time to time. 

23 A With whom? 

24 Q With the Director. 

25 A Of course. I saw him daily. 




585 






32 

1 Q When you received, let's say, certain papers 

2 on occasion would you hand-carry them in to the Director 

3 and make oral comments about them? 

4 A Occasionally. Certainly if there were 

5 specific papers that I felt that needed his attention I 

6 would hand-carry them in. I miglij. pass thera.^ Put them 

7 on his desk. He Bad various in and out boxes and reading 

8 material and so forth, so I would be able to do either 

9 one, basically. "" 

10 Q Now 1 believe" you resigned from that position 

11 sometimeajfi^larch of '86. : 

12 A ^Bke 1:4tlt o? MarchV ya feg^ - ^ "^ 

13 Q DiX^ou at aji^^|^0"^S^q t^ p^l^»d^ln wl:^ich 

14 you were in th ^^p osition, from September* '85 to March of 

15 '86, hav% any- sigj^fcicant disypssions witlr^he Director 

16 concerning the policy toward Nicaragua? 

17 A I wouldn't say any significant discussions 

18 with regard to that, no. 

19 Q Did the Director ever ask you for your 

20 observations about the situation in Nicaragua? 

21 A Certainly when we first talked in July he was 

22 obviously interested in my perceptions at that point, but 

23 he didn't specifically ask me anything, you know, from 

24 that point on that I can recall, anything substantive. 

25 Q Well, after Casey tfi)J.iij«cu that your job 



ell, after Casev tfi)J.d.|»u 



586 




33 

1 description was to keep him out of trouble, how did you 

2 go about determining what your actual responsibilities 

3 were? , 

4 A Basically what I was responsible for was to 

5 maintain a paper flow coming in to the Director, make 

6 sure that he was sort of up to snuff on what was going on 

7 administratively and so forth. We had responsibility for 

8 meetings that he would have with the various Cabinet 

9 officials and I would help to prepare briefing books for 

10 him in his meetings — for instance, with the Secretary 

11 of Defense or with the NSC. 

12 Q So in general you coordinated the paperwork 

13 for various papers coming in to the Director as well as 

14 the paperwork for various meetings that the Director 

15 might have? 

16 A That was certainly one of my riBsponsibilities. 

17 Q Did you also attend meetings with any 

18 regularity? 

19 A I attended his staff meetings on Wednesday. I 

20 would sit in occasionally on meetings that he would have, 

21 daily briefings from the DDI on intelligence. 

22 Q How about other meetings with, let's say, 

23 other CIA officials or occasionally persons outside the 
2 4 Agency? 

25 A Generally not, no. 



IINCUtSStFIED 



587 




34 

1 Q Would somebody in Casey's Executive Staff 

2 attend such meetings as a general practice? 

3 A It would depend. Certainly there were times 

4 that ^^^^^^^^H attended a meeting. There would be 

5 possibly a time when the secretary would take notes. 

6 That's a possibility. But of the executive staff, 

7 generally not, no. 

8 Q _^hi^ was the distinction betw^pji the 

9 responsibilities of tAe Spscial Assistant and those of 

10 the Executive Assi^ant? ^ 

11 A Har* to tell you really wl^ 'they were.. We 

12 were all sort 1 1 r jiiiii lifcp^ogethay o^Jgrylng^ ^ make sure 

13 that the Oire^or was fl¥h]^t^^~}St±e fed otf^vhat he was 

14 going to do. I had the responsibility occfasionally of 

15 arranging meetings^. Well,^ I'iJ^give you an example. I 

16 think I mentioned thi^ perhaps t&e last time. 

17 "^^ had r^eived a^hmie call that^^a Gea«:al at 

18 SAC headq^ilcteriF^ Nebraska' wanted ta invite th^. 

19 Director to. attend a meeting or a ceremony and so we 

20 would sort of farm that out to see if that was possible 

21 and schedule and see if he'd be interested in doing that. 

22 So in a sense what I'm telling you is that type of 

23 meeting and arranging was frequent. 

24 Q Did your responsibilities involve more the 

25 paper side than the Special Assistant's responsibilities 



UNctussra 



588 




35 

1 involved? 

2 A Well, I don't know specifically what the 

3 Special Assistant's responsibilities invoLved. Again, 

4 we're tallcing about ^^^^^HHHB now on the'^DI aide. 

5 Again, he was also very Buch-rgapsponsiblafpr certainly 

6 the briefing books, makino^ure Xh&t indeed we )a^v what 

7 the Secretary of Defmiser^n that cas^-^*- 

8 Q So just to be clear, the then-Special _ 

9 Assistant was drawn from the DDI side of the 

10 organization? 

11 A Well, at that point he was, y6s. 

12 Q And you were, of course, drawn from the DDO. 

13 A Exactly. 

14 Q Did that make for a natural division between 

15 your responsibilities? 

16 A No, not really. I mean, if there were DDO 

17 responsibilities that I had or if I had to pass that on, 

18 that certainly could very well come through me.^^^H 

19 ^^^^^falso was involved, you know, in coordination of 

20 all this. 

21 Q Would you have a regular slug or something or 

22 was there a routing symbol that would bring things to you 

23 that were -intended to ultimately go to the Director? 

24 A It would be the Executive Assistant/DCZ. 

25 Q Would people put, let's say, "copy to 



iwcranED 



589 



IINIMSWD 



36 



1 ' Executive Assistant" on the bottom of various memos? 

2 A Yeah, that would be a normal thing to do. 

3 Q So When we s«e D^^EA or something Liice that 

4 on the bottoB_ of a meeting summary or something, that 

5 would have come to you? 

6 A Most likely, yes. v. 

7 Q And what^-Kould -you do with thosa things, lat*« 

8 say backgrpw|d ^^ptirs ^at had thtt routing on thea? 

9 Would it be your job to transmit them to the Director for 

10 his use? ' 

11 A No, not necessarily. He might have gotten his. 

12 own copy. I mean, in other words, I think generally, as 

13 I recall, that the central repository for paper of that 

14 sort, after I had read that, I'm fairly clear that we 

15 would have sent it back to the Secretariat as such after 

16 that, or toss it. It was just a copy of something. 

17 Q And the Secretariat was^^^^^^H organization? 

18 A That's correct. 

19 Q Would requests for operational approvals of 

20 various kinds or things that required the Director's 

21 action commonly come, let's say, through your desk before 

22 going to the Director? 

23 A Yes, very well could. 

24 Q In that capacity did you ever come upon any 

2 5 matters related to the Iran, let's say, negotiation* with 



UNCBSSra 



590 



1 

2 
3 
4 

5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



WUSSJU 



37 



elements of the Iranian government concerning the release 
of U.S. hostages? 

A No, I did not — at least to my knowledge. At 
that point, in fact, I was totally surprised. I was not 
aware of any of that happening. 




routed "^ you,XilluI4^it ba^our j^ractfce to f%94 the 
cont^ts of t)^ c^unent^^ioKta tr^nsiiit^tbf- lt~ to th« 
Director? ^ ^ 

A Yes. 

Q Is it possible that if somethtag were routed 
to you on its cov^" sheet, is it possible that it would 
have gone to the Director without for some reason coming 
to you? 

A Thare waa alwayj that possibility. Certainly 

Id 




591 




38 

■ 1 people did bring memos to him directly that I may never 
have seen. ^^^^^^^^^^^^^^^^^^^^^^^^^^B^^^ I 

3 think probably I would have seen that. But, you know, 

4 you can't prove a negative, obviously. 

5 Q Was it your practice to initial items which 

6 were routed to you on a cover sheet of some kind, or 

7 would you simply pass them along to the Director — take 

8 note of the reading and pass them along? 

9 A I can't recall specifically if I would initial 

10 off on it or not. I suppose I probably did. But 

11 specifically I couldn't tell you that. 

12 Q Well, let me show you a document that we found 

13 in our files and see if you recall it. I'd ask the 

14 transcriber to mark this^^^^ Exhibit 2. 

15 (The docximent referred to was 

16 marked^^H^I Exhibit Number 2 

17 for identification.) 

18 As you see, this appears to be a cover sheet 

19 for a Top Secret document which appears to have your name 

20 as the routing person. Do you recall was this a common 

21 type of form for you to receive? 

22 A Yes. 

23 ■ Q I think, if you wish, you can have a minute to 

24 take a look at this and see if you recall the document. 

25 (A.hrief recess was taken.) 




592 




1 

2 
3 

4 

5 

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7 

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9 

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12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



39 

BY MR. FINN: (Resuming) 

Have you had a chance to review this document? 

A Yes, I've looked at it. 

Q Do you have any recollection of seeing this 
document? 

A I do have a vague recollection of seeing it. 
I do. 




Q Has thSr the only- such document along these 

lines that you saw or were other similar documents routed 
to you? 

A Well, I'll tell you the truth. If they were, 
I didn't pay too much attention to it, frankly. I mean, 
there were obviously things that were going on that I was 
not aware of and .tlriS-^d nof^teosssar&y ring any bell 




S 



593 



y 



iC'Cinrn 



40 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



to me as such or cause me to sit up. But I do vague Iij 
remember seeing this. 




you recall 
Charles Allen providing the Dii 
materials concerning these negotiations? 

A ' I do not recall that, no. Not to my 
knowledge. 

Q Sc you can't recall anything being routed 
through you related to that? 

A I can't recall. It's possible that i^ was, 

. ■> 
but It wouldn't mne to my memory.^. 

Q Now lijip^Jvould yy. organizB thi:^#^|^he 

lis 



offic*?* Can we assume £hat If a dqpunent 

related to a certain program or matter would be routed 
through you that all or most other documents related to 
such a program would also be routed to you? 

A Well, it would depend. Now this was coming 
from^|^|^HHH| who was generally the individual who 
would bring requests of this type to the Director's 
attention for his approval or disapproval, and to the 
best of my knowledge it would generally come to me to 



DNMHD 



594 




41 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



present it then, to make sure that the Director saw it 
and signed it or disapproved it -- whatever. 




Q Do you recall any ^her do^Ments relatad to 
the prograa of. coSacts with the Iranian government, 
related to' the release of hostages that^aJBune through you , 
for the Director's attention? ^'^-^^ 

A There inaj^.iwell hav» be^, but to^e best of 
my Icnowledge I couldn't t«ll Y9tx ^ecifically that there 
were . .^ ~ ^ ■ ' 

Q Would ^u say — ^iJrthi*: dogjonent surprise ^ 
you when you saw it? 

A As I say, it didn't shock me. 

Q Did you learn either previously or through 
this document that in fact the U.S. .^vernment had a 
program of clandestine contacts with the Iranian 
government? ,^^ 

A:- No, I did not learn that. 

Q Would you agree that that would appear from 
thidT letter.-contained herein, signed by] 



UNetmtPtED 



595 




'■B 



42 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



^^H a note for the DCI, that it would appear from that 
document, would it not, that there was a program under 
way of contacts with the Iranian government? 

A Obviously from the document itself, as it 
says, the individuals names have been blanked out, are 
involved in very sensitive negotiations. 

Q Undoubtedly the version you saw earlier had 
the names. 

A I couldn't tell you what they were. But if 
this is true, they were involved in some kind of 
negotiations. 




Q Would you take interest when things came to 
the Director's attention that involved Iran? 

A Not particularly, no, not as 

have 




596 



UNCUSSM 



43 



1 to understand that the whole world came through me. In 

2 other words, what I mean by that is that a lot of issues 

3 and a lot of various operations and intelligence 

4 information affecting the entire world, you know, a lot 

5 of that was routed through me. So I could not really 

6 spend a lot of time in my job specifically looking into 

7 these various instances. 

8 Q I certainly understand that. Would you say 

9 that by this time, late fall of '85, you had become 

10 generally aware that there was a program of contact with 

H Iran concerning U.S. hostages in Lebanon? 

12 A No, I can't say that. I would not say I was 

13 generally aware of that. 

14 Q Then for some reason this document did not 

15 make you aware? 

16 A It did not pop into my mind that this was 

17 going on. 

18 Q So since you were not aware you were not 

19 particularly looking, let's say, for such matters in 

20 other documents that may have come through you? 

21 A Precisely. 

22 Q So when did you first become aware that the 

23 U.S. Government had such a program of contacts with the 

24 Iranian government? 

25 A I think the first time I became aware of that 




irffJ 



597 



UNElA^n 



44 



1 was when it came In the newspapers. 

2 Q So even though you had seen this document in 

3 October of '85 you say that you had, let's say, no 

4 awareness that there was a program? 

5 A I would- agre«. In other words, it wasn't 

6 something I focused on reading ^his for the first time. 

7 This is the first time tftat I remember t^^ indeed this 

8 happened to come across my desk. ^^_ 

9 Q But it is your testimony, at ai^ rate, that 

10 you had seen this document when it was routed to you at 

11 the time? 

12 A That's correct. 

13 Q Thank you. Now did you do any traveling with 

14 Casey when you were acting as his Executive Assistant? 

15 A I did. Yes, sir. 

16 Q Well, why don't jeou ^^ay on what occasions that 

17 occurred? 

18 A The only one specif ically .was in late January 

20 accompanied him at least onjH^^^^^^Hportion of the 

21 trip. ^ , "^ 

22 Q Do you have any recollection of anything that 

23 explains the timing of that particular trip? 

24 A No, I do not, not to my memory. _^ 

" Mil 



598 



1 

2 

3 

4 

5 

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7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 




Q- Now did the. Director take other trips during 
your service as his Executive Assid^ntlL. 

A He did, yes, but I didn't accompany hiifc^ 

Q ' And did you ever learn, the^^aiasoo^tehat^ou 
were invited ta^acc^pany him on this^Vrip? ~ • 

A Well, I jrantttf to go myself, ~ahd -I certainly 
wanted to -^at abo^ this time IJiad deciA|j^I JBjis going 
to leave, and^ w«nted to get sort of a firsthand look, 




Q Did you ask the Director personally, face to 
face, whether you could accompany him on this trip? 

A- Yes, I did. - ~ 

Q Did you state that rationale for your 
accompanying him? 

A I believe I did, yes. 

Q Did he make any comments about that? 

A He thought that was a good idea. 




599 



1 

2 

3 

4 

5 

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7 

8 

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10 

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12 

13 

14 

15 

16 

17 

18 

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20 

21 

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23 

24 

25 



UN£WRiO 



46 



Q In preparing for that trip or any time on that 
trip do you recall any preparation for the Director 
concerning any presentations he might makel 

[concerning the necessity of support 
for the contras? 

A Oh, no. I never saw anything like that at 




Q Now who else was on the Casey delegation? 

A At that time? 

Q Yes. 

A There was 
There was i 

Q Excuse me. Do you recall the name | 

just for the record? 

A I can't offhand. I cannot remember. It's a 





iwsn 



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47 

Q Was it^^^^^^^^^^ 

^^^B yes. 

Q Thank you. ^^^^^^^^^^^His that correct? 

A Yes. There was a doctor and^^^^^^^^^H who 

was one of the secretaries, one of Casey's secretaries, 
and his security staff. 

Q And this was all on a ^^^^^^^^H aircraft? 

A Yes. 

Q A large aircraft? 

A ' Exactly. 

Q So the delegation was, as you testified, then, 
the delegation was Casey ^^^^^^^^^^^^^H yourself, 
secretary, a doctor.. Were there also communicators? 

A To the best of my knowledge there were not. 



no. 

Q 
A 
Q 

arrived] 
A 
Q 



Any other support personnel — security? 

Well, the security people. 

I see. Now that was the delegation that 

is that correct? 
That ' s correct . 
Were you aware of any plans that other CIA or 



U.S. Government officials would meet the Director in 



A No, I was not, not to my knowledge. 



601 



i^^J/bT) /J 



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Q Did you have any reason to believe that Casey 
would be discussing the subject of the contras with^^^| 
it a later stage of his trip? 

A I had no knowledge of that, if he did. 

Q Now I believe you told us in your earlier 
interview with us that you sta^^^^^^^^^Hwhen the 
Director flew on^^^^^^^^^^^H is that 

A I did indeed, yes. 

Q Was that on instruction of the Director or at 
your suggestion? 

A It was actually pretty Buch at my suggestion. 




I thought I would perhaps like to 
stay a little bit longer, if possible. 




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I'd like to skipl 

own. And he said okay. 



if it's all right with you, 
and come back on my 




Q And how did you return to headquarters? 
A I came back via probably the longest flight 
I've ever taken in my life. 

Q This was a commercial flight? 
A It was a commercial flight, yes J 




Q Now you returned sometime during February of 
'86; is that correct? 

A I believe it was probably the first part of 



February . 



MAS«D 



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Q The first part of February? 

A Maybe the end of January. 

Q And what was the situation — I'll be more 
specific — in the Director's office, namely were plans 
afoot for any further travel by the Director? 

A Yes. I don't know that they were afoot at 
that point, but they probably were. He was scheduled to 
go on another trip just before I resigned or just before 
I left in early March, and I believe he was going to 



Q Do you recall who was in the Director's party • 
during the planning of that trip? 

A I really can't recall because by that time I 
was starting to move out. I had very little to do with 
that. 

Q Was any official who either had or had at some 
point had responsibility for matters in Central America 
or Latin America part of the delegation, to the best of 
your recollection? 

A To where? 

Q 

A To the best of my recollection, no. 

Q And you have no reason to believe, is it 
correct, that the issue of support for the contras was on 
the agenda for the 



IMH 




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52 

A I have no recollection of that, and I think I 
would have remembered that if it was. 

Q Did the Director take any other trips during 
your period as his Executive Assistant? 

A He went^^^^^^^^HDid I mention that? 

Q I believe you didn't mention that. 

A I did not. He went ^^^^^^H at one point and 
I can't recall the exact dates of that, but I was not 
accompanying him. 

Q ' Now was there any discussion or did you have 
any reason to believe that the subject of the contras was 
going to come up during the Director's visit! 

A ^^^^^^^^P No, I have no reason to believe 
that. 

Q Did you have any reason to believe the 
Director would be pursuing the issue of covert sources of 
Soviet-style arms and ammunition during his visit] 

A Not to my recollection, no. 

Q I'd like to focus for a moment at the period 
December '85 and leading up to January '86, the period 
where we were just located. 

A Sure'. 

Q I believe you may have been present — correct 



me if I'm wrong — at a meeting where the Director met 



UNCt 



606 




53 



1 with General Daniel Graham and Barbara Studley. 

2 A Yes, I was present. 

3 Q We believe that meeting to have occurred on 

4 December 20 of 1985. Would that date be consistent with 

5 your recollection? 

6 A I think so. 

7 Q Generally consistent? 

8 A Yes. 

9 Q Now you were actually present during that 

10 meeting; is' that correct? 

11 A Yes. 

12 Q What was the subject of the meeting? 

13 A Well, the subject of the meeting was basically 

14 to, as I recall, to Mrs. Studley was there to tell the 

15 Director, as I recall, that she was involved in 

16 supporting the contra movement. She said that she was 

17 formerly, I believe, to the best of my recollection, 

18 either a missionary or religious figure of some sort and 

19 that she had gotten into the arms business as a result of 

20 her deep desire to support the contra movement. 

21 Q Deep religious belief. Did she also mention 

22 she was a former radio talk show host and beauty queen? 

23 A I don't recall that. Frankly, as I recall, it 

24 was a fairly short meeting, and I didn't pay a lot of 

25 attention to what she was saying. That I recall, that 



UNKASMD 



607 




54 



mfit 



1 she had been formerly involved. 

2 Q Do you recall why the meeting was scheduled? 

3 A I really don't recall that. 

*4 Q What was General Graham's point for being at 

5 the meeting? 

6 A He didn't say much at all. It seemed to me 

7 that he perhaps was making the introduction, but what his 

8 particular purpose was, to the best of my recollection I 

9 was never really clear on it. 

10 Q 'So it's your recollection that Studley, to the 

11 extent there was a presentation, Studley made the 

12 presentation? 

13 A As far as I recall. 

14 Q Were any documents distributed, to your 

15 recollection? 

16 A To my recollection, no, they were not. 

17 Q Let me show you a document which we believe, 

18 based on other testimony, to have been distributed at 

19 that meeting and see if you recognize it, and I'd ask the 

20 transcriber to mark this as^^^^^Hzxhibit Number 3. 

21 (The document referred to was 

22 . marked |^^H| Exhibit Number 3 

23 for identification.) 

2 4 As you see, this appears to be a memorandum 

2 5 from Barbara Studley to Oliver North dated October 30, 




608 



UltCttSSfftffl 



55 



1 1985, and I'll give you a few minutes to take a look at 

2 it, if you wish. 

3 (Pause.) 

4 Have you had a chance to look at this 

5 document? 

6 A Briefly. 

7 Q Do you recall this document being circulated 

8 at that meeting? 

9 A I do not recall a document being circulated at 

10 all. The only thing that sort of rings a bell is perhaps 

11 some of the conversation she had with the Director 

12 involved some of this information, but to the best of my 

13 recollection I don't recall a document. It's conceivable 

14 she did give him something. 

15 Q I believe you mentioned that Studley discussed 

16 her efforts on behalf of the contras to provide the 

17 contras with arms and ammunition; is that correct? 

18 A That's correct. 

19 Q Do you believe it may have been a purpose of 

20 the meeting from the standpoint of Graham and Studley to, 

21 let's say, wire Studley up as a potential covert source 

22 of covert procurement for the CIA? 

23 A I think if she had asked for that I would have 

24 remembered that specifically, and surely it could have 

25 been their intention. I can't specifically state that. 



UNSmflfD 



609 




56 

1 Q Would it have been the intention of Studley to 

2 attempt to secure, let's say, the blessing of the 

3 Director in a general sense for her support activity 

4 functions? 

5 A I couldn't comment on that. I just don't 

6 know. 

7 Q You didn't have the feeling that Studley was 

8 attempting to get the Director to be supportive of her 

9 action? 

10 A tt would be speculation on my part if I did, 

11 but I don't recall any specific mention of that by her. 

12 Q So she briefed the Director on her activity 

13 but to your knowledge had no reason for doing so? 

14 A She may well have had a reason to do it, but 

15 I'm not aware of it. 

16 Q But no reason that she stated? 

17 A As far as I can recall, no. As I say, it was 

18 a relatively brief meeting. 

19 Q You did not get the impression that she was 

20 seeking some form of support or approval from the 

21 Director? 

22 A To the best of my recollection, no. 

23 Q As you can see from the first two pages of 

24 this, which is the section which seems to be a memo to 

25 Ollie North from Studley, Studley is very vociferously 



^mmm 



610 




57 

1 complaining that another arms dealer, Mario Dellamico, 

2 who was associated with the Florida arms dealer Ron 

3 Martin, was essentially horning in on their source of 

4 Soviet-style armaments] 

5 A Um-hum. 

6 Q Do you recall her discussing this with the 

7 Director? 

8 A I recall the name Ron Martin being mentioned 

9 by her, but the context again I don't recall 

10 specifically. 

11 Q Was she complaining about Martin's activity? 

12 A I'm going to speculate that I think she 

13 probably was, but I can't specifically say that she said 

14 that. 

15 Q Well, did she attempt to get a commitment from 

16 the Director to stop Martin? 

17 A I don't recall that happening, no. But again 

18 that was quite a «fl$¥e ago. 

19 Q Now you'll see at the bottom of this memo that 

20 General Singlaub's name is mentioned. 

21 A Yes. 

22 Q Did Studley represent herself as being 

23 involved with Singlaub in her contra arms supply 

24 operation? This would be on page two. 

25 A To the best ff^^i^A ^W*t'i*f^® ^ don't recall 



the best of^m\' fUfiVUt' 



611 



mmmi 



58 



1 Singlaub's name being mentioned during that meeting as 

2 such, and I see his name here. 

3 Q Did Richard Secord's name come up during that 

4 meeting? 

5 A Not to my knowledge, no. 

6 Q So there was no mention of Secord being 

7 another channel of arms to the contras? 

8 A Not to my knowledge at that point, no. 

9 Q Let me show you another document which we 

10 believe may have been circulated at that meeting and see 

11 if you recognize it. I will ask the transcriber to label, 
that as^^^^H Exhibit 

13 (The document referred to was 

14 marked^^H^H Exhibit Number 4 

15 for identification.) 

16 A Do you want me to study this thing? This is 

17 the first time I've ever seen it in my life. 

18 Q Just sufficiently to answer whatever 

19 questions. If you feel you need more time to Axaaine it, 

20 please say so. 

21 A Okay. 

22 Q Do you recognize this document as having been 

23 on the table at _Uiat .meeting? 

24 A No, I do not. 

25 Q Based on your iajpiiJ-afitV from reading this 




612 




59 

1 document at the present time, does this cause you to 

2 recall that any of these matters were discussed by 

3 Studley with the Director at that December 20 meeting, 

4 namely the idea of creating a circular arrangement in 

5 which a trading company would be established to supply 

6 freedom fighter movements which Congress was unwilling to 

7 support for one reason or another and that Israel would 

8 sell certain things, military equipment, to the People's 

9 Republic of China, who would supply the Soviet arms, 

10 which would then be brokered to the freedom fighters, and 

11 that Israel would be benefitted by the United States 

12 through a high technology support or other compensation? 

13 Do you recall anything? 

14 A What's the question? 

15 Q Well, the question is were the matters that I 

16 have just described discussed by Studley at that meeting? 

17 A To the best of my knowledge, they were not, 

18 no. 

19 Q Do you recall the same day as the meeting with 

20 Studley that the Director called Richard Secord for a 

21 meeting? 

22 A No, I don't. 

2 3 Q Let me show you a document which we've been 

24 provided by the CIA, which we are informed is a summary 

25 of the Director's meeting log and_ telephone log with 

Ici 




613 



liNeiAS«B 



60 



1 Richard Secord. I'll ask the transcriber to label this 
^^^^^H Exhibit 

3 (The document referred to was 

4 marked^^^^^H Exhibit Number 5 

5 for identification.) 

6 You'll note on this summary that there is a 

7 meeting and a phone call with Secord by the Director on 

8 December 20. 

9 A Um-hum. 

10 Q ' Do you have any knowledge of that? 

11 A Not specific knowledge. We would get 

12 generally a list of people that he was going to visit on 

13 a particular day and if we start talking about my meeting 

14 with Secord Z was trying to remember where I had heard 

15 his name and I vaguely do remember that he may have seen 

16 the Director. 

17 Q ^^''Mj^y something shortly before your 

18 departure, in this time frame? 

19 A Yes. But the timelUrame now is December 20. 

20 Q This particular meeting would have been 20 

21 December 1985. 

22 A It's possible that he did, but it didn't ring 

23 a bell to me anyway, if indeed he met with him. 

24 Q Let me show you some testimony and I'll aslc 

25 the transcriber to label this^^^^^flExhibit 6. 

PRl 




614 



mmm 



61 



1 (The document referred to was 

2 marked^^^^^H Exhibit Number 6 

3 ^ for identification.) 

4 This is the partial transcript of Richard 

5 Secord's testimony that was taken on May 5 of this year, 

6 just a few days ago, during the Iran-contra hearings. 

7 Now I direct your attention starting on page 193, which 

8 is the first page of this document, about two-thirds of 

9 the way down, and into page 194. Secord describes his 

10 meeting with the Director. I'll give you a few minutes 

11 to just read those pages. 

12 A When is this taking place? 

13 Q According to Secord, Secord says it would have 

14 been a few days before Christmas '85, but according to 

15 the Director's logs it would appear to be December 20, 

16 the same day the Director met with studley. I would ask 

17 you to read to page 196. 

18 (Pause.) 

19 A Okay. 

20 Q Now, as you'll see from the pages 193 to 196 

21 of the transcript of Secord's sworn testimony the other 

22 day, Secord recounts a meeting with the Director a few 

23 days prior to Christmas of 1985 in which there was, let's 

24 say, a significant discussion of Nicaragua and the need 

25 for improvements in logistical support to the contras. 




615 




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b 

A Um-hum. 

Q This could correspond, we believe, to the 

Director's telephone call and meeting with Secord listed 
on the previous document that we gave you, which was 
Exhibit 5. Were you present during tshi« meeting? 

A No, I was not. "C? 

Q Were you aware the meeting was occurring? 

A No. 

Q Did you know Secord at this time? 

A 'No, I did not. *: 

Q Now I believe you said during an earlier 
interview that you were also present at another meeting 
in December of '85 which involved Adolfo Calero and 
Enrique Bermudez. 

A I was. 

Q Can you recall who the other participants 



myself. 



[was there, the Director, and 

Q Not Clair George? 

A No. 

Q What was the subject of that meeting? 

A Well, the subject, as I could see, it was 
basically a courtesy call, one of the few meetings I 
attended, perhaps the only meeting I attended with regard 




616 




63 



1 to Nicaragua in terms of the contra leadership. It was 

2 basically a courtesy call by the two heads of the FDN, 

3 from what I could ascertain, and basically a plea — 

4 well, first of all, there was essentially a briefing 

5 given by both Bermudez and Calero, Bermudez particularly, 

6 on the military situation in Nicaragua to the Director 

7 and his comments that in(^ed while their military 

8 situation looked at least reasonably all right for the 

9 time being, for the six to eight-month period, military 

10 supplies, that they were having a lot of trouble with 

11 regard to other supplies. 

12 Q Humanitarian type, let's say, nonVlethal? 

13 A Non^lethal specifically. And I think it was 

14 brought up at the meeting that the humanitarian aid that 

15 was supposedly being shipped by the State Department 

16 under Congressional authorization was not getting to the 

17 contras. So there was a general, I guess you would say, 

18 a general plea by Mr. Calero that if there was something 
that could be done to particularly^^^^^^^^^^^^^^to 

20 allow the release of these goods, that that would be 

21 appreciated. 

22 Q So this meeting occurred during the period 
during which ^^^^^^^^^^Bwere, for one 

24 another, delaying and not permitting the NHAO flights? 

25 A To the best of my recollection, that was it. 

^1 




617 



WkMsm 



64 



1 Q Can you place that meeting in the month of 

2 December? Was it prior to the Studley-Graham meeting? 

3 A I don't think I can place it directly, no. In 

4 fact, I couldn't place the Studley meeting, you know, to 

5 a specific date. But to my recollection they both 

6 occurred in December and probably before Christmas. 

7 Q Also, was this meeting with Bermudez and 

8 Calero shortly before Christmas? 

9 A I wouldn't want to speculate. I don't know. 

10 My guess id it would be probably earlier in December. 

11 Q Just to help you, you said that by January, I 

12 believe you stated earlier that by January you were 

13 resolved to leave and to help the contras directly 

14 yourself. 

15 A Exactly. 

16 Q And was this meeting well before that in 

17 December or sometime — 

18 A My best judgment is probably somewhere around 

19 the first or second week of December, talking about the 

20 Calero meeting. 

21 Q Right. So you think it was the first part of 

22 December? 

23 A Yes. I'm sure there's a log. 

24 Q And this was in the Director's office at 

25 Langley? 



UNOASSiEi) 



618 



mmm 



65 



i A That's correct. 

2 Q Was the situation portrayed by Calero and 

3 Bermudez at that time particularly desperate for the 

4 contras? 

5 A Well, it seemed to me that they were 

6 portraying that as such. Of course, I think one could 

7 say that indeed if aid was not being received or at least 

8 the humanitarian aid that the contras were supposed to be 

9 getting, that indeed yes, it could have been very 

10 desperate.' 

11 Q Now you mentioned one of the chief issues or 

12 needs of the contras as expressed by Calero and Bermudez 

13 was the need to get the humanitarian assistance rolling 

14 ^^^^^^^^^^^H again. Was equal emphasis placed on the 

15 importance of having a means to deliver various kinds of 

16 assistance, humanitarian and otherwise, from the contra 
bases ^^^^^^^^H into Nicaragua? 

18 A I don't think that was specifically discussed 

19 at the meeting. It seemed to me the general tone of the 

20 meeting was that Calero was hoping that the 

21 Administration and Congress could turn around and begin 

22 resuming, you know, full aid to the resistance. That was 

23 the general tone of it. And specifically, as I recall, 

24 he was talking about the lack of aid that had been 

25 authorized being received by the contras. 



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Q So it was primarily getting humanitarian or 
other non-h-ethal assistance down to Central America where 
it could do the contras some good and not the issue of 
getting these various forms of deliveries inside 
Nicaragua that was the subject? 

A To the best of my recollection, that was not 
specifically discussed. If it was, I don't recall it. 

Q Now did Calero or Bermudez make a direct 
appeal for Agency assistance in logistics, for example 
using Agency aircraft or helicopters or anything of that 
nature? 

A No. To the best of my knowledge, that didn't 
occur. 

Q No such appeal was made? 

A That I recall. 

Q Was there any discussion of the arrangements 
that the contras had using their own aircraft or aircraft 
associatedi^y^lfr other organizations to move supplies into 
Nicaragua to support their military activities? 

A You'll have to repeat that. I'm sorry. 

Q I'm sorry. Was there any discussion by Calero 
and Bermudez of the means they were using to get supplies 
inside Nicaragua? 

A I can't recall if they specifically talked 
about that, so I would have to say to the best of my 



t 



620 



umssffl 



67 



1 recollection, no, they didn't discuss that as such. It 

2 was not a lengthy meeting that we had and if they brought 

3 that up specifically I don't recall it. 

4 Q Specifically did they make an appeal for CIA 
assistance^^^^^^^^^^^^^^^^^^^^^^^^^^^^^H to 

6 permit their flights f rom^^^^^^Hand other bases to go 

7 once again inside Nicaragua? 

8 A I don't think that they specifically said the 

9 CIA. They may have implied that, but they wanted the 

10 U.S. Government to try to convince ^^^^^^^^^^^Hto 

11 release this aid, if I recall correctly. 

12 Q Now what I'm getting at is that their appeal 

13 for U.S. Government support was not only to get the 

14 humanitarian assistance ^^^^^^^^^^fbut also to get 

15 whatever kind of assistance, whatever supplies they had 

16 into Nicaragua. 

17 MS. MC GINN: Object to the question. He's 

18 answered that several times already. It is no, they 

19 didn't discuss that. 

20 BY MR. FINN: (Resuming) 

21 Q Is that your answer? 

22 A Would you repeat it once more for me, then? 

23 MR. FINN: Will Counsel permit the question to 

24 be repeated? 

25 THJL i^lTJiS^Sj -k^^^iPi^r-iJ-Jv^ ^*^* same question. 




621 





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68 

I just want to make sure. 

BY MR. FINN: (Resuming) 

Q I'm sorry for the repetition, but I'm trying 
to assi-st your recollection. My question was whether the 
assistance of the U.S. Government that was sought by 
Calero Bermudez vis-a-vis ^^^^^^^^^^^^^^^^^^Hw as 

only ^^^^^^^^^^^^^^^H to allow the 
assistance into that country but also to permit the 
contras to stage their supply operations into Nicaragua? 

A 'No. I don't recall that as such. 

Q You don't recall that? 

A No. No, there was no discussion of that that 
I can recall. 

Q Now I believe you said in your interview 
previously that this meeting affected you so much that 
you wrote a memo of the meeting; is that correct? 

A Yes, I did. 

Q Did you by any chance take that memo with you 
when you left the CIA? 

A No, I did not. 

Q Do you recall where you located that memo? 

A Where I located it? 

Q Um-hum. 

A Well, I ~ think I gave one copy to the Director 
and one copy to — I may have sent it down to the 



UNttitssra 





622 



69 

1 National Intelligence Officer, Bob Vickers, and probably 

2 to^^^Has well. It basically outlined, you know, what 

3 had been discussed at the meeting. Again, this is, of 

4 course, a year and a half ago, so I can't recall exactly 

5 what was on that memo. 

6 Q Would it be ordinary practice in Casey's 

7 office for that memo to have gone into a file? 

8 A Probably not, no. I don't recall what he did 

9 with the memo. He could have just read it and put it in 

10 his out basket but not into a file. 

11 Q Would that be ordinarily a classified memo? 

12 A Sure. Oh, yeah, it would be classified. 

13 Q I believe in your previous interview you also 

14 mentioned that you wrote a memo, I believe, sometime 

15 later, perhaps in January or February of '86, with some 

16 suggestions to the Director. This was an unsolicited 

17 memo, I believe. 

18 A It was in November, actually. 

19 Q Related to improving the situation of the 

20 contras in November '85? 

21 A That's correct. 

22 Q Did you retain a copy of this when you left 

23 the CIA? 

24 A 

25 Q 




623 





u ~ 

1 A Exactly. 

2 Q Who else aside from the Director did you give 

3 copies of that memo to? 

4 A I gave a copy of that to J 

5 Q So just to the Director and toj 

6 A As I recall, yes. 

7 Q Do you recall what position you argued in that 

8 memo? 

9 A Well, it was basically a think piece more than 

10 anything else. I had been feeling strongly about the 

11 problems again sort of back to the problem that I felt 

12 existed, some of the problems that existed with the 

13 Nicaraguan — with the Nicaraguans as such and the 

14 Sandinistas and the resistance, and I think I outlined, 

15 as I recall, some of the problems that we had been up 

16 against with regard to the resistance, and I think that I 

17 suggested that I thought that there might be a way of 

18 possibly, because of the problem, because of the lack of 

19 funding, because of the specific buildup in the 

20 Sandinista military and political machinery, that perhaps 

21 several of us would have to resign, or at least I would, 

22 I think I indicated that people that were familiar with 

23 the situation and try to assist legally, as non- 
24 government officials with no ties to the government, the 
25 resistance as such- 




624 



^ I ?™« 




El 



71 



1 I think that was sort of the broad outline, as 

2 I recall, of the memo that I wrote. 

3 Q Now that's a fairly radical scheme, wouldn't 

4 you agree? 

5 A Not really, if you believe that indeed their 

6 survival was most necessary for the security of the 

7 United States, as I did, and that you could not obviously 

8 do this as a government official because of the Boland 

9 Amendment, that this would be a possibility of at least a 

10 partial fi'x of the problem or attempt. I didn't think it 

11 was radical. Certainly it's unusual. 

12 Q Did you get any reaction from the Director as 

13 such? 

14 A No, I didn't really. Of course, I thought 

15 about that, obviously, because it was to me a 

16 particularly critical memo, in my view, but no, he didn't 

17 have any specific comment on it. He did ask me to show 

18 it ^° ^^^^^^^H ^^<^ 1 did, or at least I gave him a 

19 copy and I asked^^^^^lcomment. ^^^^^Hcomment was that 

20 he didn't think it was particularly workable. In that 

21 sense you would probably have to have full Republican 

22 Party support for something like that, much like one saw 

23 in Europe in the opposition or the political parties that 

24 involved themselves to more a degree than this country in 

25 foreign policy, that that kind of a system would have to 




625 



MMM 



72 



1 be engendered that way. 

2 Q You mean there would have to be something akin 

3 to a social democratic movement or Christian democratic 

4 movement or organization to support such a thing? 

5 A I think that was ^^^^^| point on that. But 

6 the Director himself really had no comment on it, 

7 specific comment on this. 

8 Q Well, how did you ultimately communicate your 

9 decision to follow through on your plan to leave and 

10 actually go about doing that? 

11 A Well, I came to him in, I believe, mid- 
12 January, to the Director, and I said that basically with 

13 the reporting that we'd been getting, obviously the 

14 meeting with Calero and so forth, that I felt in my own 

15 emotional state or my view was that I thought I would 

16 have to leave the Agency and try to do what I could to 

17 mobilize or try to mobilize more private sector support. 

18 Well, he commended me for that. He had 

19 earlier at one point I think maybe I mentioned to you in 

20 the previous testimony, that when I first talked to him 

21 about this in July, when I came up to see him for the job 

22 interview, that I said I had thought about resigning, and 

23 he said that he indeed had as well. He said I know an 

24 awful lot of rich people and maybe I could solicit their 

25 aid as a non4government official. 



IClASStffi 



626 




D 



73 



1 Q Casey said that in July of '85? 

2 A He said that in July of '85 when I was talking 

3 about the fact that indeed this humanitarian assistance, 

4 you know, had now at least partially removed that anxiety 

5 that I had about helping. So in a sense he commended me 

6 for my patriotism and so forth and let it go at that. 

7 Q Now in January of '85 — I'm sorry, January of 

8 '86, humanitarian assistance I think at that point was 

9 finally being received in a more or less effective 

10 manner. 

11 A I wasn't aware that it was. As you recall, in ■ 

12 December at least of that year Calero was complaining 

13 very strongly, so I had no specific knowledge that it 

14 was. 

15 Q Did you ask anyone else about the probability 

16 that U.S. Government support, both humanitarian and 

17 otherwise, would be forthcoming in the future? Did you 

18 consult with various officials concerning whether it's in 

19 a sense worth it to leave or whether the U.S. Government 

20 would take over again? 

21 A Oh, I see. Yes, I did. I mean, I think I had 

22 as good an opinion about whether the Congress would turn 

23 around or not as anybody else did, and it was my 

24 indication or my feeling personally — and I think most 

25 people's feeling — that no, they probably would not. 



\mmm 



627 



UNGlASSra 



74 



1 Certainly a full aid package was not going to be 

2 forthcoming. 

3 Q What would be the ordinary end of your tenure 

4 as Executive Assistant had you not resigned? 

5 A Had I not left? Well, I would probably have 

6 been there about a year. That seems to be the normal 

7 state of affairs. 

8 Q So let's say September of '86 would have been 

9 your ordinary departure? 

10 A 'Right. 

11 Q Had you received at the time of your decision 

12 in January of '86 any indication of what your subsequent 

13 assignments might be in CIA? 

14 A No, I had not specifically. I think I 

15 probably would have stayed in the Agency or at least at 

16 Headquarters level. 

17 Q Did you have lu^ ^^^Mi^^ feelings about 

18 your career at that time? 

19 A You'd have to be a little bit more specific. 

20 Q I'm just wondering why you made the rather 

21 dramatic decision to leave. You were obviously a CIA 

22 officer with a good pedigree and you had prospects. 

23 A Well, I felt very strongly about this, very 

24 strongly, obviously, and that was the reason that I left. 

25 That was certainly the overwhelming reason that I left. 





D 




628 



75 

1 Q In this meeting or discussion you had with 

2 Casey in January of last year, did Casey give you any 

3 reason to believe that you would be successful in your 

4 efforts to raise funds? 

5 A No. 

6 Q As of that time, when you made this decision, 

7 how did you envisage your activities in the future to 

8 support the contras? 

9 A Well, I wasn't really certain what my 

10 activities Vould be. I felt very much that I could not 

11 really look into the- private, you know, whatever was 

12 going on in the private sector as a government official. 

13 In other words, I really couldn't look into that 

14 particular area. It wouldn't have been appropriate for 

15 me to do that. So I really couldn't lay much groundwork 

16 as a member of the CIA at that point. 

17 But I think my vague — my feelings were that 

18 if either I. could fit into something or do something on 

19 my own, particularly with regard to raising money, that 

20 this would satisfy certainly a need that I felt and also 

21 perhaps be of some help to the resistance as well. 

22 Q Did Casey make any suggestions in the middle 

23 of January of last year concerning individuals you might 

24 see to get started? 

25 A Well, he mentioned, wondered if I had talked 

[ol 




629 



UNIMSSJflf'' 



1 to Clair George about my decision -- now whether he meant 

2 my leaving or not, I don't know — °^ ^^^^^^^| ^"^ 

3 then he also at one point mentioned Ollie North. 

4 Q Do you remember anything more about what Casey 

5 said about any of these individuals? Why would you 

6 contact Clair George? 

7 A That's all he said. Have you talked to Clair 

8 about this? He wondered about North, ^^^^| I can only 

9 speculate that, of course, Oliver North didn't work for 

10 the Agency'. These other two men did. I can only 

11 speculate that he may, you know, have been aware that 

12 Ollie was certainly knowledgeable, certainly, in the 

13 private sector area more than he was, but specifically he 

14 never said. 

15 Q Did you follow up on Casey's suggestion that 

16 you should see George and ^^HH| 

17 A I saw^^^^H I think I had basically written 

18 a memo saying that I'm going to resign and I did not see 

19 Clair George. I talked to his associate, Ed Juchniewicz, 

20 about my desires, and then, of course, later I talked to 

21 Ollie as well. 

22 Q Why don't you go through, for the record, your 

23 contacts with North after Casey suggested? 

24 (A brief recess was taken.) 

25 BY MR. FINN: (Resuming) 



^tzn 



630 



yNCLASsra 



77 



1 Q I believe we were discussing the period in 

2 which let's say you were deciding. You had first 

3 expressed your intention or were expressing your ultimate 

4 intention to leave the Agency, and you talked to Casey in 

5 mid-January of last year, and Casey, you stated, referred 

6 you to Clair George, ^^^^^^^^H and Ollie North. 

7 A Among others. 

8 Q Among others? 

9 A Well, I don't recall anybody else specifically 

10 that he mentioned. 

11 Q Did he mention Singlaub at that time, General ■ 

12 Singlaub? 

13 A No. He mentioned that later. 

14 Q And I believe shortly thereafter you had a 

15 meeting with Ollie North; is that correct? 

16 A Yes, that's correct. 

17 Q Can you describe that? 

18 A Sure. Let me tell you how that happened. 

19 Again, I had mentioned that with the Director and so 

20 forth, and the chronology is this, that we then went on 

21 that trip^^^^^^^^Hand I also was out for a little bit 

22 of sick leave. I had a back injury. 

23 So the point is that I really didn't get back 

24 on Ollie North really until I thirtk it was probably 

25 around the third week, second or third week, of February, 



UNttJSStM 



631 



littatsstf 



78 



1 and I went to the Director and I said essentially can you 

2 give him a call because I'd only met North at one point. 

3 Q Just to clarify, that one point was^^^^^^^H 

4 A That was the one point ,^^^^^^^1 just that 

5 brief occasion. I didn't know if he would remember me or 

6 not. So I went ahead and called him. The Director 

7 didn't say specifically he was going to call or not, but 

8 I think he did, because when I called North he seemed to 

9 know who I was. 

10 ' It was a secure phone. I said, you know, I'd 

H like to get together with you. And he said fine. I said- 

12 I'm thinking about resigning or I am going to resign and 

13 he said okay. 

14 Q Was this all on the telephone? 

15 A It was on the telephone. And he said 

16 basically let's get together. 

17 Q Did you indicate that not only were you 

18 intending to resign but also to assist the contras? 

19 A Well, I don't recall exactly what I said on 

20 the phone. I said I wanted to get together with him 

21 particularly with regard to the fact that I was in — oh, 

22 yeah, I'm sure I mentioned it. 

23 Q Would North have been aware of your desire to 

24 assist the contras as .the reason for that meeting? 

25 A I think so. I think I said I wanted to help 



SSlflED 



632 



IWSi 



"' 79 



1 out the resistance. No question of that. And he said 

2 yeah, they need all the help they can get. 

3 Q So how was the meeting with North arranged? 

4 A The meeting was set up this way. We decided 

5 on a place, which was Charlie's restaurant on 123, and we 

6 set a time and a date. 

7 Q That was during your first conversation on the 

8 phone with North that you set the time and place? 

9 A I think so, yes, on the phone. And he said, 

10 you know, r think at some point — we did also talk a 

11 couple of times on the open phone because we missed the 

12 meeting. He didn't show up. So we did obviously discuss 

13 a meeting. 

14 Q So it was back and forth on scheduling? 

15 A We missed the meeting. We finally get 

16 together and we got the date and time. I walk into 

17 Charlie's Restaurant. 

18 Q When did the meeting finally occur? 

19 A I don't have the specific date, but it was 

20 probably, at least I'm pretty sure, probably the last two 

21 weeks in February, probably the third week, I would 

22 imagine. And I had told him, you know, I would sit at 

23 the bar and have a couple of packs of cigarettes in front 

24 of me so he would recognize me. 

25 So I'm there at the appointed time and this 




633 



24 



mmmiw 



80 



1 gentlemen comes over to me and introduces himself as Dick 

2 Secord, and I think at first I hadn't seen Ollie. It was 

3 a little dark, and I thought maybe it was Ollie, but it 

4 obviously wasn't. It was Secord, and he said that Ollie 

5 would be coming in a few minutes. He'd be a little bit 

6 late. 

7 So we sat down and just, you know, very 

8 briefly chatted for a couple of minutes until Ollie 

9 showed up. 

10 Q 'now just to clarify, you had never met Secord? 

11 A I had never met Secord before. 

12 Q And he approached you and introduced himself? 

13 A Exactly. We sat there and Ollie showed up, 

14 and the gist really of the whole meeting was that I told 

15 him — I'll have to say that I was a little — I didn't 

16 know really who this Secord fellow was, although I had 

17 some indication. 

18 Q Had you heard of Secord before? 

19 A I'd heard his name definitely, but I didn't 

20 connect him with Ollie North or necessarily with, as I 

21 recall, the Central American aspect of anything. Anyway, 

22 we sat and we chatted and Ollie showed up. And I told 

23 Ollie that I was leaving, planning to leave, probably 



within the next two weeks, and he said good. He said 



25 we discussed, and I'm not sure exactly the chronology of 



634 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



UNMH 



n 



81 



this, but I think he wanted my views 




He was interested in that. I told him of some 
of my views on the needs, what I perceived were the needs 
of the resistance -- money, training. And then he 
proceeded to explain to me or at least said that there 
had been established — he never said that he had 
established, but there had been established a series of 
foundatiorts as well as corporations that were assisting 
the resistance. 

And he basically described them as five or six 
foundations, I think, if I recall correctly, which 
received money, donations, and these monies were somehow 
transferred to the particular companies that had been 
established as well to facilitate either the purchase or 
the shipment of equipment and supplies. 

Q Diebiyou get an impression of where the 
foundations were located? 

A Well, to the best of my recollection he said 
they were in Europe. I think the foundations were in 
Europe and the companies were in Europe, but I'm not 
clear on that, but Europe was mentioned specifically. 

Q Did North mention tax deductible contributions 



to foundations? 



iiNetfssif 



635 



ILASSfJ 



82 

1 A No, not to my knowledge, not at all. He sort 

2 of generally described the situation, you know, this 

3 mechanism of sorts, and he may have certainly mentioned 

4 the tax daduction angle to the foundations, but I 

5 couldn't tell you for sure of that. 

6 Q What form of assistance did you believe that 

7 these were providing to the contras, based on North's 

8 description? 

9 A Well, I didn't know for sure. There was no 

10 specific mention of any military equipment as such. You 

11 know, he didn't say well, this is all military. He 

12 didn't say that, but it was my impression from what he 

13 was talking about that it was a fairly extensive 

14 operation. And my impression also, although Secord 

15 didn't really say much during this meeting, was that 

16 obviously he had something to do with this, maybe 

17 logistics support in terms of this operation. 

18 Q Did Secord give you any reason to believe that 

19 he was involved in the logistical side of things or that 

20 was a conclusion? 

21 A That was sort of my conclusion. As I say, he 

22 didn't say too much at the time. 

23 So, anyway, you know, that was sort of the 

24 gist of what Ollie recounted. Now he was very passionate 

25 and articulate about the problems^nd so forth, and so we 



ate about the problemg— ar 



636 



mamm 



83 



1 discussed that. And in a sense I suppose I could have 

2 joined up with that. He didn't specifically offer any 

3 job, but that was what he was describing. That's 

4 obviously part of what he was saying to me. 

5 Q Was there any special reason that you didn't 

6 take advantage of that opportunity or indicate an 

7 interest at that time? 

8 A Well, I'll tell you the truth. I was somewhat 

9 interested in it. I mean, you know, these are both to 

10 me, it seemed to be, quite honorable men. I mean Ollie I 

11 knew a little bit about him. I didn't know anything 

12 about Secord as such, but Ollie described him as a 

13 patriot and a man of integrity and he was obviously out 

14 of the government at the time. But I think I came away 

15 from the meeting — I think it's more important to 

16 understand how I come away from that. 

17 Certainly I think at that point I was 

18 intrigued by it. I felt that I was dealing with, you 

19 know, honorable men. Certainly North, from the little 

20 reputation I had of him, seemed like a good guy. So 

21 those were the positive aspects. 

22 I think the negatives were that this was a 

23 little bit vague. I wasn't sure and would have to know a 

24 lot more about it before I would really get involved, and 

25 that certainly there was a little bit of a question in my 



DNEblSffD 



637 



UNEIASSMD 



84 



1 mind the degree that Ollie North was specifically 

2 involved in this. You know, that was a question that I 

3 would have had in my mind. 

4 Q You mean concerning the extent of involvement 

5 of a U.S. Government official with contra support? 

6 A Precisely, although he never said specifically 

7 that he was involved in this. But he said that he was 

8 certainly knowledgeable of it. 

9 Q Approximately how long did this meeting last? 

10 A i would say it was about maybe an hour. 

11 Q You had lunch? 

12 A No. It was nighttime. I think it was 6:00 or 

13 7:00, We had a beer. I think we had something to eat at 

14 some point. 

15 Q Did you ever discuss that meeting with the 

16 Director when you went back to your job at your office? 

17 A Well, yes. I didn't discuss the meeting 

18 specifically. I certainly didn't describe it to him, but 

19 I said, look, you know, I met with Ollie and I said — I 

20 asked him what's he involved in here. And the Director 

21 said very specifically I don't know, and I don't want to 

22 know. But Ollie 's a good guy. 

23 Q Is that fairly close, to your recollection, 

24 the Director's actual words? 

25 A Just about, yes. 



UNCussra 



638 




<wi 



85 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



Q Would you repeat them? 

A I said what's Ollie involved in, and he says I 
don't know and I don't want to know. 

Q And then he said? 

A But he's a good guy. 

Q Something like Ollie 's a good guy? 

A Yeah, he's a good guy. 

Q Which you took as encouragement to continue? 

A No. 

MS. MC GINN: Object to the question. 
THE WITNESS: That's fine, because it wasn't 
encouragement at all. 

BY MR. FINN: (Resuming) 

Q Are you quite sure of your description of the 
time of day in which the meeting with North and Secord 
occurred? 

A The time of day? That it was at night you 
mean? 

Q The evening? 

A Oh, yeah, I'm sure of that. 

Q At some point I believe you had some contact 
with General Singlaub; is that correct? 

A That's correct. 

Q How did that occur? 

A Well, about a day or two before I left the 



imSMD 



639 



uN^we 



86 



1 Agency — I'm sorry, not the day before I left the 

2 Agency. The Director had left, was going to leave on an 
trip^^^^^^^^^^^H towards the week, in the 

4 first week of March. And about the last conversation I 

5 had with the Director after I had said goodbye, I 

6 remember it was sort of the last day that -he was going to 

7 be around, and I would therefore have a couple of weeks 

8 to process out and so forth, because he'd be gone. 

9 He came to me and he said I've met with 

10 General Si'nglaub, John, Jack Singlaub, and I think that 

11 was on his schedule. I think I knew that he had met with* 

12 him. And he said this guy's involved in a lot of things. 

13 He says, he's involved in Nicaragua. He's involved in 

14 the resistance movement ^^^^^^| or at least he claims he 

15 is, and^^^^^land so forth. He says, this is a guy you 

16 ought to talk to. 

17 And he said I gave him^^^^f name and I gave 
him^^^^^^^^H name -^^^^^^^^H you know 

19 and I gave him your name. He says, have these guys give 

20 him a call. Let's find out what this guy's doing. You 

21 know, he's got all kinds of stuff happening here. 

22 So I called. I think I calle(»|HVf irst and 

23 ^l^^^ays no. First of all, he says the Director 

24 shouldn't even be meeting with Singlaub. He said that's 

25 a mistake. And I said well, yeah, because I had heard a 



DNetftSStFtED 



640 




87 

1 little bit about Singlaub, too. I mean, I just knew he 

2 was very, very political. 

3 So^^^Hsaid, you know, that was a mistake. 

4 He shouldn't have met with him anyway. But he says we 

5 don't want anything to do with this guy. And also I 

6 think I called^^^^Hand I said, you know,^^H the 

7 Director wants you to call Singlaub. He's at the hotel. 

8 I've got his number and all this. And I said, you know, 

9 look, this is a direct order here, but I mean, on the 

10 other hand, 'maybe it's not the wisest thing to do here. 

11 I mean, this guy may not help the Agency. So 

12 the long and short of the matter is that I don't know 

13 whether^^^^Hcalled Singlaub or not. I doubt it. But I 

14 ^°^^^i|^^^^K ^ said, look, as you know, I'm leaving here. 

15 I'll deal with^^^^^^H after I leave. In other words. 



16 you know, I'll talk to him, whatever he's got.^^^^^f 

17 says, yeah, do that. That's good. 

18 So while I was still there at the Agency, 

19 those last two weeks, Singlaub calls me at my office, and 

20 I'm sure he got the number probably. It was the same as 

21 the Director's office. 

22 Q Same general number? 

23 A Well, it was a different extension, but I 

24 think, you know, he has my name, so he calls and says — 

25 he probably asked the secretary to talk to me. So that's 



UNetftSfft 



641 



UNCUSSIFe 



88 



1 the best of my recollection, but I certainly recall him 

2 calling me. 

3 Q This was at the beginning of March? 

4 A This would be about the beginning of March. 

-il. 

5 And -T^ said — this is General Jack Singlaub. I said, 

6 yes. He said I'd like to get together with you. You 

7 know, I understand you are leaving, or some words to that 

8 effect. And I said, fine. I said, General, I'm going to 

9 be out of town here for a couple of weeks. Let me get 

10 back to you. As a matter of fact, I said I'll give you 

11 my home phone number. 

12 When I come back, if you're going to be back 

13 in town, why don't you call me. So we left it at that, 

14 and shortly thereafter, after I resigned — well, let me 

15 just finish that. I think the last thing that Casey said 

16 to me the last time I ever saw him was that same day 

17 after he had told me that he had given my name to 

18 Singlaub, that he sort of towards the end of the 

19 afternoon came to me and said, well,^^^^|thinks that 

20 was a big mistake I made here. 

21 He said, you know, maybe I made a mistake, 

22 basically, by giving your name out or at least giving all 

23 this stuff. And I think that was sort of his parting 

24 words. 

25 Q I'm sorry. Gould you go through that again, 



yNcmi 



642 



DNCUSSISEO 



89 



1 that Casey indicated that he had made a mistake? 

2 A Yeah. As I recall, he said, you know, 

3 Singlaub is not the kind of guy that maybe the Agency 

4 should be talking to or that was the impression that I 

5 got, but basically that, you know, there's no sense in 

6 the Agency dealing with Singlaub as such. But all he 

7 said was, you know, I think maybe I did make a mistake 

8 here with this. Those were his words. 

9 Q Did you see Casey as attempting to discourage 

10 you from contacting Singlaub? 

11 A No. I told him basically I'll be leaving. 

12 I'll deal with him. I mean, I can talk to him. I have 

13 no problems with that after I leave. He said all right, 

14 that was no problem. 

15 Q He didn't encourage you as such to do that? 

16 A No. 

17 Q Let me interrupt your story just briefly to 

18 introduce into the record asB^^^^^Exhibit 7 another 

19 list of the Director's meetings with various individuals 

20 which has been provided to us by the Agency. 

21 (The document referred to was 

22 marked ^^^^^1 Exhibit Number 7 

23 for identification.) 

24 Vou'll notice under John Singlaub there is a 

25 meeting in November of '84 — ^fWiW^^^P that one. 



WSA& 



643 




pIsukXtj 



90 



1 There's a telephone conversation February 25 of '86, and 

2 a meeting February 27 of '86. Now I believe you have 

3 just testified that it was your impression that Casey had 

4 met with Singlaub shortly before the events that you just 

5 described. 

6 A Right. 

7 Q Would these dates be more or less consistent 

8 with that impression? 

9 A I think so, sure. You're talking about the 

10 25th and 27th? 

11 Q The telephone call on the 2 5th and the meeting- 

12 on the 27th. 

13 A That would certainly have to be the time, 

14 sure. 

15 Q Now after you left the Agency Singlaub did in 

16 fact contact you again; is that correct? 

17 A Yes, that's correct. 

18 Q Let me go back to^^^^H comment. You had 

19 more or less agreed, I suppose, even before the Director 

20 came back to you and sort of cancelled in a sense his 

21 previous instruction as regards the Agency, that^^^^H 

22 had agreed with you it would be a good idea for you after 

23 leaving the Agency as opposed to a CIA employee to meet 

24 with Singlaub. 

25 A No, he didn't agree to that. I said let me do 



o, he didn't agree to tha 



644 



MM 



LU 



91 



1 that. I mean, there's no sense -- if this guy is real 

2 bad news, you know, there is no sense in anybody doing 

3 anything with Singlaub as such. I said, you know, I can 

4 call him after I'm out. 

5 Q Did Casey or^^^^Bor anyone else at the CIA 

6 give you any particular instructions to follow during 

7 your interaction, subsequent interaction with Singlaub? 

8 A Absolutely none. 

9 Q Did they say that you should attempt to 

10 convince Singlaub or make Singlaub believe that you were 

11 a channel for Singlaub to the Director? 

12 A Absolutely not. 

13 Q Or that you should make it appear that the 

14 CIA, through the Director, supported Singlaub 's 

15 activities at that time? 

16 A Absolutely not. 

17 Q So why don't you describe how Singlaub got in 

18 touch with you again? 

19 A He called. He called me at home I think 

20 shortly after I resigned — it might have been within the 

21 week after I left — ahd asked to get together. And I 

22 said sure. I think we had a meeting at his hotel. I 

23 don't know the exact date, but it was probably within the 

24 week or two after I left. 

25 We had some breakfast and he basically 



wmm^ 



645 




92 

1 described this sort of world anti^cominunist league that 

2 he was involved with and their activities. He had a 

3 tendency to ramble. I didn't quite, frankly, pay a lot 

4 of attention to what he said. I know that he was very 

5 active in lobbying efforts on the Hill. He seemed to 
■6 have very close connections with Jesse Helms. I mean, 

7 this is what he was talking about. 

8 Q In connection with Senator Helms did Singlaub 

9 suggest that in concert with Senator Helms or Senator 

10 Helms' staff or whatever that he was attempting to secure 

11 supplies for Eden Pastora's group in south Nicaragua? 

12 A I don't know that he was saying it through 

13 Helms' office, but there came a time — I met with 

14 Singlaub at least twice, I believe, brief meetings after 

15 I left, and there came a time — perhaps it was the 

16 second meeting; and again I can't tell you the exact 

17 dates here, but we're talking still certainly in the 

18 spring, maybe April — where Singlaub had showed me a 

19 letter that he I believe — yes, in fact he had already 

20 given the letter to Pastora which said that the U.S. 

21 Government — no, which said that the United States would 

22 support Pastora if Pastora moved his troops, of which he 

23 had very little, into the southern front of Nicaragua. 

24 And, you know, it was, I guess, my impression 

25 at that time that this guy really ~ I mean his political 



ttNttftSSIFtED 



646 





93 

1 judgment here, first of all representing himself — i 

2 said did you represent yourself as the U.S. Government? 

3 He said, no, no, no. It's U.S. He said, I've talked to 

4 a lot of people about this, and I think he may have 

5 mentioned Helms at that point. 

6 Q Did Singlaub indicate that he had already 

7 taken this letter down to Pastora? Or was this before he 

8 had done that? 

9 A He said he had gone to see Pastora and had 

10 visited one of his camps. 

11 Q Did Pastora 's signature appear on the 

12 agreement? 

13 A I'm trying to think. You know, I'll tell you 

14 the truth. I don't know that it did or not, and I'm 

15 trying to think if he had showed me that letter before he 

16 went down or afterwards, that he had gotten the 

17 signature. I think it may have been before. I don't 

18 recall Pastora 's signature as such, but I do recall 

19 Singlaub indicating at some point that he had gotten h.is 
2 agreement or was trying to get his agreement to do this, 

21 to move his forces into the southern front in return for 

22 support from the U.S. 

23 Q Now this thing was in the form of a letter, 

24 the document that you saw? 

25 A I think so, yeah. 



DNCHSnO 



647 



wmm 



94 



1 Q How many pages was it? 

2 A I think it was like one page. It was like a 

3 legal memorandum 

4 Q Did it have signature blanks at the bottom or 

5 something like that? 

6 A I think so, yeah. It had his name, and I 

7 honestly cannot recall if Pastora's name had been signed 

8 there. 

9 Q Was there a space for Pastora? 

10 A 'l think so. 

11 Q But you can't recall whether the actual 

12 signature was present? 

13 A I really don't. I mean, I was more looking at 

14 this letter thinking that this man is somehow 

15 representing the U.S. Government and I asked him directly 

16 are you representing somebody here. I said, you know, 

17 you don't have U.S. Government, but you've got U.S., the 

18 United States will, and Singlaub says well, I'll do what 

19 I can to get that kind of support for Pastora. 

20 Q Did Singlaub mention other people who were 

21 supportive of this agreement, particularly, for example, 

22 Ambassador Tambs in Costa Rica? 

23 A I think he said he had talked to Tambs or was 

24 planning to talk to Tambs ekbout this, but t don't know 

25 that he specifically said he had gotten his agreement on 



HNCttSSIFtED 



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S|CttV^f«i«) n 9 5 




1 this thing or not. 

2 Q I see. But you're not sure whether Singlaub 

3 had actually met with Tambs on that? 

4 A I can't remember if he said he was going to 

5 meet with him or that he had met with him. 

6 Q How about Elliott Abrams? Did he make any 

7 statements about Abrams? 

8 A I don't think he mentioned Abrams at all. 

9 Q Did he mention Ollie North at all in 

10 connection 'with that? 

11 A No, he did not. 

12 Q Did he say that he had showed this agreement 

13 to Director Casey? 

14 A No, he never mentioned Casey. 

15 Q Or anyone else at the CIA? 

16 A I don't think so, no, because, you see, I 

17 think there was always an impression, or at least as much 

18 as I tried to dissuade him that I perhaps was somehow a 

19 channel to the Director, and I kept telling him I am not, 

20 I have resigned, I'm not that, and sometimes when you 

21 tell people like that, you are emphasizing it too much; 

22 therefore, obviously you are. 

23 Q Did you see any danger that in fact along 

24 these lines that your meetings with Singlaub could be 

25 misinterpreted by Singlaub as an expression of some form 



mcttsanED 



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CL 




96 



1 

2 

3 

4 

5 

6 

7 

8 

9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



of support? 

A Precisely, and that's pretty much the reason I 
really discontinued seeing -him. 




So I think I was much more sensitive. I was 
still floundering around a little bit, and I'm thinking 
back on my motives for not getting involved and sort of 
doing as much as I could on my own was to make sure that 
there was no association, certainly not in reality, but 
even in appearance that somehow I was representing the 
Agency at some point. 

Q Are you aware that Singlaub is now claiming 
that he was encouraged to sign this agreement by various 
agencies of the United States? 

A Is that right? No, I wasn't aware of that. 

Q Are you aware that Eden Pastora feels that 
this agreement was engineered to cause him considerable 
embarrassment in the breakup of the southern front 
constituted under his leadership? 




S 



650 



llNeMiP 



97 



1 A I'm not aware of it. I'm not too surprised at 

2 what Pastora would say and so forth, but no, I'm not 

3 specifically aware of that. 

4 Q Don't you agree there was a danger in your 

5 meetings with Singlaub that Singlaub might interpret this 

6 as CIA support for this activities that he has been 

7 briefing to you and that, therefore, when that support 

8 was not forthcoming there would be some hazard to the 

9 individuals involved? 

10 A 'well, I think I told him in very specific 

11 terms that I didn't think from my view that the Agency, 

12 particularly the Agency, wanted to have anything to do 

13 with Pastora. I mean, you know, that I recall telling 

14 him personally. 

15 Q Let me draw your attention back to the last 

16 exhibit that we had, which was number 7, and you will see 

17 that there was a telephone call between Singlaub and 

18 Casey on March 20 and then a telephone call April 21, and 

19 a meeting April 24. Then there were subsequent telephone 

20 calls and meetings during May — May 5 and 8, 1986. 

21 Now did Singlaub or Casey, if Casey contacted 

22 you again, -or anyone else give you any reason to think 
2 3 that there was a continuing exchange between Casey and 
24 Singlaub? 

2 5 A Did anyone do that? Casey I haven't seen 



tnmssiFiED 



651 




uiiuLHooiriLU 

1 since I left. 

2 Q And haven't spoken to him? 

3 A Nor spoken to him, absolutely not. 

4 Q Now did Singlaub mention that he had also had, 

5 let's say, in your later meetings after you left the 

6 Agency, did Singlaub mention that he had had these 

7 communications with Casey? 

8 A To the best of my knowledge, he did not, no. 

9 I don't recall. I don't think he mentioned the Director 
10 at all other than to, you know, sort of imply that he 

H thought I was a contact or that I might have been a 

12 contact through him. And I kept saying no, I was not. I 

13 only had, I think, to the best of my recollection, I 

14 think I only had two, possibly three, meetings with 

15 Singlaub. 

16 Q Do you have any reason to believe that the 

17 Agency had a political action program — let's describe 

18 it as a political action program — or project through 

19 which to discredit Pastora by setting him up with an 

20 expectation of U.S. Government assistance which was then 

21 withdrawn? 

22 A Absolutely not. 

2 3 Q And you have no reason to believe, therefore, 

24 that Singlaub was a witting or unwitting agent in any 

25 such effort? 



BWSJSSIfltD 



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UMSfffl) 



99 



1 A No knowledge of that. That sounds like a 

2 Singlaub theory, though. He has got a lot of theories. 

3 Q Let's go to some of the other ones. You 

4 mentioned that Singlaub in his meetings with you 

5 discussed various other support to freedom fighters in 

6 various other places. You said he had some interest in 

7 j^H^^I is that correct? 

8 A Not to me. This is what the Director told me. 

9 He said that Singlaub had mentioned this, and this guy's 

10 all over the place, the implication being that Casey was 

11 interested in seeing what the guy was doing. 

12 Q Did he also mention, did the Director also 

13 mentior ^^ 

14 A Not to my recollection. I'm not certain, but 

15 I don't recall. 

How about^^^^^^^^^^^^^^^^^^^^^^ Was 

17 that mentioned? 

18 A No. 

19 Q Did you have any impression that Casey, aside 

20 from rhetorical support, was lending any other support to 

21 these efforts by Singlaub to assist freedom fighters? 

22 A Absolutely not. Absolutely not. As I recall, 

23 the only specific mention of a resistance organization 
was^ — 

25 had mentioned as such when he came and said this guy's 



653 



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100 



1 all over the place. 

2 Q I see. This was the non+communist resistance 

4 A I would imagine that's what he was talking 

5 about. 

6 Q Moving right along, I believe you may have had 

7 some contact with Ray Burkhardt at the NSC. 

8 A Ves, I did. 

9 Q I believe shortly before leaving the Agency; 

10 is that correct? 

11 A Actually it was after I left the Agency. 

12 Q Could you describe that briefly? 

13 A Sure. Just before I left the Agency Bob 

14 Vickers and Vince Cannistraro called me and said, look — 

15 I told Vickers I was leaving. I don't know if I talked 

16 to Vince. vince was down at the NSC at the time. He 

17 said, you know, there's a job opening up here on the 

18 Central American desk, as such, of the NSC under 

19 Burkhardt, and he said, you know, you might be interested 

20 in ge'tting that job. 

21 And I said well, you know, that's not really 

22 what 1 had in mind, basically. I'd be happy to talk to 

23 Burkhardt about it, but I -mean my idea here is really to 

24 leave the government and try to do what I can. I don't 

25 think I can do any different than I could at the Agency. 



UNtASMD 



654 



WtASSffl 



101 



1 Of course, I didn't know about all this. But, anyway, so 

2 I did go down and see Burkhardt the first of April, after 

3 I had left the Agency, and I had tried to call him a 

4 couple of times because I was interested in chatting with 

5 him anyway to see what the offer was. 

6 I went down and met with him and he told me 

7 that this job was opening up but that he thought that 

8 they probably would be filling this with a political 

9 appointee, that Poindexter wanted that filled with a 

10 political appointee of sorts. And I said that's all 

11 right because I didn't want the job anyway. So it was 

12 essentially a non-nob offer and a nonf acceptance. And 

13 that was essentially the discussions. 

14 I did tell him that I had left the Agency. 

15 Q Did you meet Colonel North while visiting Mr. 

16 Burkhardt? 

17 A I did indeed. I met him right after I talked 

18 to Burkhardt, walked over and, by no prearrangement, 

19 Ollie North's office was across the hall from Burkhardt. 

20 In fact, I think I told Burkhardt I was going to go and 

21 try and see Ollie. 

22 Q How much time did you spend with North that 

23 day? 

24 A About three minutes — three or four minutes. 

25 Q That was just in the hal^lway? He was going 

Icfi 




655 



(tticusn 



102 



1 down to a meeting at the White House and we sort of 

2 walked along the hallway. 

3 Q And what did North say to you at that time 

4 concerning your plan to get involved in fundraising for 

5 the contras? 

6 A Well, first of all I told him I'd left, and he 

7 said okay. He said what are you going to do, and I said 

8 essentially what I wanted to do was — I thought I still 

9 was looking around, but I thought that probably I would 

10 get involved in the fundraising activity. He said, good. 

11 He says, have you talked to — I told him, I said, I 

12 enjoyed getting together with you. I said I didn't know 

13 too much about Secord. He said, well, go see Secord. He 

14 said he's a good guy. 

15 I had told him also that I would give them 

16 more of my views on the resistance needs, so he said go 

17 talk to him, go see him. So I said I would. 

18 Q Did you do that? 

19 A I did. 

2 Q And how did you arrange that? 

21 A Well, I gave Secord a call. In fact, I think, 

22 as I recall, I had a hard time getting hold of him. He 

23 was always gone. I had, I think you know, maybe called 

24 him two or three times. Finally he called me and I said 

25 let's get together for lunch, as we had discussed before. 



iiNcutsstfe 



656 



fc^SS/f/ffl 



103 



1 and he said fine. And so we did have a luncheon meeting 

2 the first week of May. 

3 And you are probably interested in what was 

4 discussed at that meeting. 

5 Q Certainly. 

6 A He was quite pleasant, didn't really talk 

7 about too much in substance, particularly with regard to 

8 his logistical operation or whatever he was involved in, 

9 although he was quite forthcoming about his background 

10 and what hfe was doing or what he had been doing. 

11 He talked about his background in Iran. He 

12 had been in Iran. He talked about his involvement with 

13 the Saudi AWACS system when he was Deputy Assistant 

14 Secretary of Defense. We didn't really talk too much 

15 about the logistical organization. I never got the 

16 feeling that he was really too interested in my getting 

17 involved in it in any case. 

18 Q He didn't make you any offer as such? 

19 A Absolutely not. As a matter of fact, there 

20 was never an offer as such. 

21 Q Did Secord seem particularly interested about 
2 2 the Central American activities at the time you met him? 
23 A Oh, yes, definitely. He was quite 

2 4 knowledgeable, it seemed to me. 

2 5 Q Did he ever give you any indication that he 




657 



ONCUSSIHED 



104 



1 was getting weary of the business? 

2 A Yes, he did. At one point we were talking 

3 about — and I can't remember the context of this, but he 

4 said that, you know, he really was getting a little — he 

5 was sort of getting set to get out of this whole project 

6 that he was involved in, this operation. 

7 Q Now did you lay out your own views about what 

8 the contras needed? 

9 A Exactly. 

10 Q ' How did he respond to that? 

11 A Well, I had given him basically a little paper- 

12 on training needs that I thought the resistance needed. 

13 I mean, I sort of delineated that. I was specifically 

14 interested in, you know — I was concerned about the lack 

15 of training that the resistance had and I thought that 

16 that, along with money, was one of the focuses of an 

17 effective resistance movement that had to be done from my 

18 perspective. So I had given him that. 

19 Q Do you have a copy of that? 

2 A No. I did not keep a copy of it. 

21 Q Have you written any other things that 

22 describe your views about how this assistance could be 
2 3 conducted to the contras? 

24 A Not about that specifically, but I have been 

25 doing a piece on the first year of the revolution in 




658 



UimSSIFtED 



105 



1 Nicaragua. 

2 Q This is a historical piece? 

3 A Exactly, basically. But that's been on my 

4 own. 

5 Q Vou haven't set down on paper anywhere or in 

6 an electronic medium your plans for fundraising or your 

7 views on the types of assistance which the contras 

8 needed? 

9 A No, other than this one. 

10 Q You didn't take any related documentation with 

-11 you from the CIA? 

12 A I did not. 

13 Q So when you and Secord broke up this lunch 

14 meeting, what was the understanding between you? Was 

15 there any particular understanding? 

16 A Well, I'l^you, one thing I wanted to do also 

17 was get a hold — I had started at that point looking 

18 seriously for donors, for people through friends of mine 

19 and so forth for aid for the contra movement, 

20 humanitarian aid, and I needed at some point, or would 

21 have needed at some point a mechanism, a foundation of 

22 some sort that was reliable and was above-board, that if 

23 I did come into some money that I would have to use. 

24 Q Is it your testimony that your plan as far as 

25 obtaining assistance for t he conif fls was to identify 




659 



mmm 



106 



1 potential donors who you would then direct to an 

2 appropriate foundation? 

3 A Precisely, exactly. I was starting basically 

4 at ground zero when I left because I'd only been in 

5 Washington about six months and, as I said, I hadn't 

6 really looked. I didn't feel it appropriate to really 

7 look into that while I was still in the Agency, so the 

8 fact of the matter was that I needed, you know, that type 

9 of foundation. And I asked Secord about that at the 

10 luncheon. 

11 I said if I do come across somebody, can you 

12 recommend somebody, and he said, well, yeah. He said, I 

13 don't know anybody. He says I'm not involved in that. 

14 But he said certainly if you get something going I'll 

15 make sure somebody gets ahold of you. 

16 Q At this point why don't we get into the 

17 reasons you believed you might be successful in locating 

18 a donor. As you say, your time in Washington was 

19 somewhat limited. You had spent a lot of time outside 

20 the United States. 

21 A Exactly. 

22 Q What caused you to believe that you might be 

23 successful in identifying a donor? 

24 A I wasn't certain that I would be successful, 

25 but it seemed to be really the major appropriate way of 

|e(J 




660 




107 

1 doing this would be if I indeed was interested in getting 

2 money to the resistance, particularly the humanitarian 

3 side, that one has to go out and start to solicit that 

4 money. 

5 Q Was your view that you would in a sense make a 

6 mass appeal for contributions or find a few, let's say, 

7 wealthy people who might contribute significant sums? 

8 A The latter. 

9 Q And how did you believe that you might be able 

10 to identify such individuals? 

11 A Well, I felt that I would have to go to 

12 friends of mine who perhaps would be able to. I didn't 

13 know wealthy donors or any wealthy potential donors, I 

14 guess. I didn't know anybody that was wealthy, frankly. 

15 But I did know people that were in touch with potential 

16 people that would perhaps make contributions. And so I 

17 began doing that, in other words, after I left, making a 

18 conscious effort to try to find these people and try to 

19 solicit some money from them. 

20 Q You mean try to find your friends? 

21 A Well, I found my friends, but then to see what 

22 indeed would be involved. 

23 Q Can you give me the names of some individuals 
.24 who are friends of yours whom you believed might have an 
25 ability to locate? 



INWStFtED 



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103 

1 A I would rather not. I think I'd have to seek 

2 counsel on that if I had to. I'd feel very badly about 

3 doing that. 

4 Q Sure. Could you answer whether one of these 

5 friends was Bill Casey? 

6 A Absolutely not. 

7 Q Were any other friends officials in the United 

8 States Government? 

9 A No officials of the United States Government, 

10 none whatsoever. 

11 Q So you were going to proceed through friends, • 

12 individuals you describe as friends, to locate wealthy 

13 persons. 

14 A Not necessarily just wealthy people, but 

15 people that would be politically inclined to perhaps seek 

16 other wealthy people. In other words, it didn't have to 

17 be somebody who was just wealthy. It would obviously 

18 have to be somebody who had — who felt the same way and 

19 would be able to bring together some people. 

20 Q These were based on your own personal 

21 contacts? 

22 A Precisely. 

23 Q This did not include — the friends or persons 

24 who would bring you to these people emphatically did not 

25 include Billl 



II 





662 




109 

1 A No, it did not. 

2 Q Were there any officials of foreign 

3 governments who fall into that category? 

4 A No, there were none. 

5 Q Okay. At a later date I believe you finally 

6 succeeded or believed you might have succeeded in 

7 locating a potential donor; is that correct? 

8 A That is correct. 

9 Q Now how did that situation arise? 

10 A 'Well, I had contacted a friend who said that 

11 he thought that maybe he could put me in touch with some • 

12 people, both in the New York and Miami area, and he 

13 identified one specific one, and he said that this fellow 

14 would very definitely be worth seeing. And that brought 

15 about a third meeting — well, actually a follow-up 

16 meeting — with General Secord because I was interested. 

17 You recall that the luncheon meeting was the 

18 first part of the week or at least the first week of May. 

19 I did again see him at his office for a brief period. I 

20 believe it was around the third week of May, if my memory 

21 serves me right. I at that point had identified a 

22 potential donor and I went to his office and he actually 

23 had invited me over at the luncheon, at some point to 

24 come on over and see him. 

25 So I came over and spent about five or ten 




663 




110 

1 minutes wi€h him and told him, do you have anybody? I 

2 think I'm going to be making a trip here in-country and I 

3 think I'm going to be able to see somebody and I need 

4 some kind of a mechanism here if indeed there's a 

5 considerable amount of money that this man can give or 

6 can facilitate. I don't want to handle it myself. 

7 He said fine. He said — he seemed to be a 

8 little distracted at the time. This was maybe the third 

9 week of May. If the paper accounts are all true, then — 

10 Q ' They were very busy. 

11 A Anyway, he said I'll have somebody call you on. 

12 that. And it came to be about the end — well, I left 

13 and didn't see him again ever. It came to be about, I 

14 think, the first week — end of May, first week of June. 

15 My friend had lined up a trip to see this man and I 

16 needed this foundation. I needed something. 

17 So I called Secord a couple of times. Usually 

18 he wasn't there or he was traveling or something. I even 

19 called Ollie North's office at one point, I think In 

20 early June. He was not there either. I finally got hold 

21 of Secord I think the second — early second part of the 

22 week of June — because I knew when I made the trip. And 

23 I said I haven't heard from anybody yet. He says, okay, 

24 I'll get somebody to you. 

25 And I think the next day that I talked to him," 




664 




FFirii 111 



1 after I talked to him I got a call from Carl Channell, 

2 who asks me if I am a donor. And I said no, I'm not a 

3 donor, but I think I may know somebody that is. And he 

4 said, fine, let's get together. 

5 Q Now at this point had you already undertaken 

6 the travel? 

7 A No, I had not, because I wanted that 

8 preparation. I wanted to have something there in case 

9 the guy was going to ask questions about this. 

10 Q Did you ultimately take that trip to see the 

11 potential donor? 

12 A I did, yes. 

13 Q Together with your friend. Did you meet with 

14 the donor? 

15 A We did meet. 

16 Q What was the nature of that meeting with the 

17 donor on the situation? 

18 A I would have to tell you first about my 

19 meeting with Channell because I had that before the 

20 meeting with the donor. We met the same day, and he 

21 said, you know, he says I'll be at the Mayflower Hotel at 

22 2:00 and he says I'm carrying — so you'll know me, I'm 

23 carrying a gold suitcase. So I said fine. 

24 I showed up. There's a guy with a gold 

25 suitcase. We sat down and we had a drink together. He 



ONdLffle 



665 



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112 



1 had apparently been meeting with somebody that day ^ at 

2 the hotel. So he said — he told me who he was, gave me 

3 his card. He was the president of this National 

4 Endowment for the Preservation of Liberty. He described 

5 it as a tax-exempt non\-profit organization registered 

6 with the U.S. Government. 

7 He said it has been successful in obtaining 

8 aid for the contras through this, and I said when I 

9 approach this donor — and I gave him the guy's name and 

10 he didn't acknowledge knowing that individual — but I 

11 said what can I tell this guy? He says well, you tell 

12 him it's a legal foundation. If they have any questions 

13 on it, the guy should consult his lawyer. 

14 So essentially, armed with that information, I 

15 had the name of that foundation, I went to see this 

16 donor. So I wanted to give you that background. 

17 Q Did you discuss with Channell the nature of 

18 the support that the foundation provided, his foundation, 

19 NEPL provided the contras? 

20 A I hadn't heard that one. Not specifically, 

21 no. It was my understanding that if it was tax-exempt 

22 and non+profit and registered it was obviously on the up 

23 and up. And he gave me the impression that the 

24 foundation had been used quite a few times. In the back 

25 of my mind I wondered if this was one of the foundations 



666 




^M^^ 113 

1 that Ollie had described, North had, and I don't know to 

2 this day if it was, but I suspect it might have been. 

3 Q Did you bring up the subject of North with 

4 Channell? 

5 A He mentioned North. I guess more he said 

6 Ollie North has high regard for you, so I think basically 

7 what he was trying to say is that I'm okay. In other 

8 words, you're meeting with the right person. 

9 Q So did that lead you to believe that North had 

10 put Channel'l on to you in a sense? 

11 A Yeah. 

12 Q Did Channell give you any reason to believe 

13 that any of the contributions that he was soliciting 

14 through his various organizations, including NEPL, would 

15 go for, let's say, lethal assistance to the contras? 

16 A Not specifically at all. He didn't say that. 

17 I was left with the impression that basically, because of 

18 the way he described the setup, that I was aware of the 

19 problem with military aid, so I felt it was basically 

20 probably humanitarian or nonf^ethal anyway. 

21 Q Did Channell describe in any way his 

22 activities to influence public opinion in the United 

23 States? 



i4*^ 
d him 
1 

25 articulate, somewhat impressive guy. He said that he had 



24 A Well, he was quite forward himself, a rather 



UNCtASn 



667 



UNI^ASSIFIfO 



114 



1 been doing a lot of lobbying on the Hill. He mentioned 

2 having met at one point the President. He said -- we 

3 were pretty much talking about resistance needs and so 

4 forth, but I got the impression that he was quite active 

5 on the Hill. In fact, I read about him later in the 

6 papers. 

7 Q He didn't mention his media campaign in 

8 support of the contras? 

9 A I don't think he did, no. I don't recall 

10 anything like that at all. It was about a 15-minute 

11 meeting. 

12 Q Did you ever see Channell again after that 

13 meeting? 

14 A Never did, no, but I talked to him. I called 

15 him when I came back from the donor. Now the donor said 

16 that he thought that maybe he could do something, but it 

17 wasn't going to be his money and he said that if indeed 

18 we could get — you know, he said I'd be willing to put a 

19 few of my friends together and come up and have a 

20 briefing of some sort, you know, on the situation. He 

21 didn't say whoever you represent. 

22 But, in other words, if you could come up and 

23 do that, that we might be successful in getting some 

24 money together. 

25 Q Now just to get this straight. The donor is 



inw^ssnu 



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DNGLASM) 



115 



1 located up in New Vork; is that correct? 

2 A Veah. 

3 Q And you have a friend also in New York? 

4 A I have a friend here who knew the guy. 

5 Q And the plan was that you and your friend 

6 would go to New York and discuss the situation of the 

7 contras with the donor? 

8 A Well, yeah. I told the friend that I was 

9 interested in seeing if we could get some money. 

10 Q And it was your understanding the donor wasn't 

11 going to use his personal funds necessarily? 

12 A That was the sort of implication there. The 

13 guy wasn't real clear on that, but I thought he was 

14 probably sincere, that he would probably try to do what 

15 he could. 

16 Q Did he refer to, let's say, a tax deductible 

17 contribution by a corporation or something of that 

18 nature? 

19 A No. He was talking about personal friends of 
2 his. That was the idea. In other words, he'd have 

21 friends of his get together and have this briefing and 

22 see if we could get some money. 

23 Q Did you have any reason to believe that the 

24 donor was an acquaintance of Bill Casey? 

25 A No, absolutely not. Now I never told the 




669 



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H6 



1 donor what organization this was either. I wanted to 

2 have that in the back of my mind. So when I came back I 

3 called Channell and said I've got this guy who looks 

4 interested and I said that the only problem is, he's 

5 going to be tied up here. I basically explained to 

6 Channell over the phone what I have just told you, and 

7 Channell said yeah, that's great. 

8 I said the donor probably is not going to be 

9 available until the first part of July. This was, now 

10 we're talking about mid-June. And he said okay. Channell 

11 said he was going to be taking some vacation until, I 

12 think he said, the 20th of July. And he said let me know 

13 after I get back. Let me know where the thing stands. 

14 And I think about four or five days later the House 

15 passed the $100 million bill, which came as both a 'relief 

16 and a shock to me because in a sense it was back to where 

17 the money should be, back in the U.S. Government. 

18 Q Just to run through the dates a little bit 

19 again, you met Channell the first time — I'm sorry. 

20 When did you meet Channell? 

21 A It had to have been just before the weekend 

22 that I went up there, so this would be about the 10th or 

23 11th of June when I actually met him. I met him the same 

24 day he called. 

25 Q And_ then you went to New^ York. 



670 



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117 



1 A Um-hum. 

2 Q Returned? 

3 A Um-hum. 

4 Q And then Channell was in New York? 

5 A No. Channell was still here. He had given me 

6 his telephone number. I called him when I came back, 

7 just about after the 14th or 15th of June, and explained 

8 what the situation was. 

9 Q Did Channell also go to New York to see the 

10 donor? 

11 A The story is not over yet — just about over, ' 

12 but not quite. I called Channell towards the end of July 

13 after he had come back, or maybe it was just after his 

14 return. I had also taken some vacation with my wife and 

15 children. And I called him and I said, you know, they've 

16 already passed the bill or they've passed the aid bill, 

17 so we don't need that any more, do we? 

18 And he said, no, quite the contrary. We do 

19 need it. He said, as a matter of fact our 

20 prognostication of when the Senate will pass this bill or 

21 get this in Committee and get the money actually 

22 allocated could be two or three months from now, maybe 

23 even more. And he said indeed the situation is very 

24 desperate now because we've been getting reports of some 

25 starvation down in the resistance camps. 



UNCUSSiED 



671 




118 

/ 

1 So he said can you arrange this. I mean, we 

2 need the money; So I said, sure, of course, or at least 

3 I'd try to do that. So I got ahold of the intermediary 

4 here, who I'm always dealing with. I don't think I 

5 talked to the donor again in person. In fact, I'm sure I 

6 didn't, either by phone or meeting. I said, can we 

7 arrange something? I said the situation is such that it 

8 looks quite desperate right now. Of course the aid money 

9 will be coming eventually, but right now it's a problem. 

10 So my friend said he'd see what he could do. 

11 So what happened was this. We got the donor to agree to • 

12 meet with Channell in New York. This would have been 

13 about mid-August now. The guy kept delaying. I was 

14 starting to think that this donor maybe really wasn't 

15 going to come across here and that we maybe sort of 

16 struck out on this deal, but I thought it was worth a 

17 chance. 

18 And I talked to Channell. As a matter of 

19 fact, I talked to this girl named Jane McLaughlin, who 
2 apparently obviously worked for NEPL, and she kept 

21 calling me up and saying can we ariraTige this thing, and I 

22 said yeah, I think we've got a date. Can we do this in 

23 New York, in other words, rather than having the guy come 

24 down here. And Janie McLaughlin said yes, we can. 

25 Channell 's going to be up there on business anyway at 




672 




119 

1 this specific date and can we set up some sort of a 

2 meeting at a hotel or something along those lines. 

3 I said let's do that. They went to the hotel. 

4 The donor didn't show up. 

5 Q "They" being Channell? 

6 A Yeah, and I think Jane as well, McLaughlin. I 

7 think the two of them went. 

8 Q And how did you discover that? 

9 A Well, the guy says he's not there. He says 

10 we've been waiting for him. By this time I realized this 

11 donor's apparently not that serious. 

12 Q Did they call you from the meeting place at 

13 the hotel? 

14 A I think they did, as a matter of fact. They 

15 hadn't shown up. 

16 Q The intermediary was there, too? 

17 A Ko. Just Channell and McLaughlin waiting for 

18 the donor. And so finally the end of the story is that 

19 the donor doesn't show and I think a couple of days later 

20 I got a call. I was in touch with McLaughlin and I said 

21 I'm sorry about this, and she said well, we appreciate 

22 your help, that happens, and is there anybody else that 
2 3 maybe we can discuss and so forth. And she invited me 

24 down to the headquarters of this organization. 

25 I spent, I guess, abojj^2 minutes with her^, 

Id 




673 



IINtl^SlflED 



120 



1 not Channell -- I didn't see Channell again -- discussing 

2 possible other donors that we might be able to go to. 

3 Q What was the magnitude of the contribution 

4 that was envisioned from this donor? 

5 A It's hard to say. 

6 Q Did you ever have any discussion of the 

7 amount? 

8 A You know, he may ha^e mentioned something 

9 about $200,000 — $100,000 to $200,000 — he thought he 

10 could get together. At some point that was the magnitude 

11 of it. 

12 Q So with respect now to Singlaub and Secord and 

13 North and Channell are the meetings and contacts you have 

14 described today to the best of your recollection the ones 

15 that occurred during the period we have discussed? 

16 A Very definitely. 

17 Q How have you supported yourself since you left 

18 the CIA? 

19 A I have supported myself by my pension return, 

20 contribution, by the sale of land that I had purchased 

21 during my career in the Agency, and by my savings of 

22 being overseas for basically the last ten years or so. 

23 Q And this piniion contribution was a lump sum 

24 disbursement from your retirement account; is that 
2 5 correct? 



UNEkASSra 



674 



mLASSVUD 



121 



1 A That's correct. 

2 Q You were not eligible for retirement at this 

3 time; is that correct? 

4 A That's correct. 

5 Q Did you have any firm agreement wi& the 

6 Director or anyone else in the CIA concerning your return 

7 to the Agency after this period of unemployment? 

8 A Absolutely no firm agreement at all. 

9 Q And, to repeat, you had no contractual 

10 relationship with the Director or any official of the CIA 

11 or the Agency concerning your period outside the 

12 government? 

13 A Absolutely not. 

14 Q And, similarly, no contractual arrangement 

15 with the National Security Council? 

16 A Absolutely not. 

17 Q Okay. I believe in response to our request 

18 you were going to voluntarily provide your tax -- I 

19 believe a copy of your tax return; is that correct? 

20 A Indeed that's correct. 

21 Q We certainly appreciate that. 

22 A Do I ever get it back? I guess it's a copy; 

23 it really doesn't matter. 

2 4 Q We could make a copy? 

25 A N(j,,^t's okay. I'll give it to you. Here it 

Wcl 




675 



wmmm 



122 



1 is. I also included a copy of the — the question is 

2 really here this was sent to me. This is a contribution 

3 which is not taxable. In other words, it's not part of 

4 my taxes, but I wanted to somehow let you know that I got 

5 this. I don't have any problem giving that. Is there 

6 any problem? It's not classified. 

7 Here's the full tax return. I got it iir^ha 

8 mail, but it does say the Agency on it. It says contact 

9 the Agency. 

10 MS. HUGHES: Can we go off the record? 

11 (A discussion was held off the record.) 

12 MR. FINN: Thanks for being so cooperative as 

13 to furnish your tax^related information, which I would 

14 ask the transcriber to enter into the record as 

15 Exhibit 8. 

16 (The document referred to was 

17 marked^^^^^H Exhibit Number 8 

18 for identification.) 

19 Let the record also reflect — and I invite 

20 counsel to make any comment she wishes to make on this — 

21 thali^^^^^^^^H has also supplied for our inspection a 

22 document which appears on a form numbered 12-77 3123A, 

23 entitled Notice of Refund of Retirement Contributions. 

24 And this form specifies that a refund check numbered 

25 ^^^H^^H dated 12/10/86, is being mailed and that that 



BNtftSStflED 



676 



Mu$im 



123 

1 check apparently would be sent to^^^^^^^^^Lt the 

2 address he gave for a refund of an unspecified nature in 

3 the total amount of $35,918.02. 

4 And be it also noted that although the 

5 document is not classified that counsel has some 

6 objections to its being taken, accepted by the Committee, 

7 and thal^^^^^^^^^l will provide it to counsel, and the 

8 Agency has received our request for whatever version of 

9 this document is appropriate, even though it is an 

10 unclassified document. 

11 Is that acceptable? 

12 THE WITNESS: Can we go off the record a 

13 second? There's one thing you didn't say. 

14 (A discussion was held off the record.) 

15 MS. MC GINN: Let the record just reflect that 

16 this document does describe itself as a refund of 

17 retirement contributions, so that the amount of the 

18 refund is for his retirement contribution while a Federal 

19 employee. 

20 BY MR. FINN: fResuming) 

21 Q ^^^^^^^^^|L your intention in bringing this 

22 document was to show us the nature of the $35,000 and 

23 some odd contribution which would appear in your bank 

24 records? 

25 A Precisely. 



UNOtftSSilit 



677 



»biSt!l 



124 



1 MR. FINN: Thank you very much. 

2 THE WITNESS: If we could go off the record 

3 one more time? 

4 (A discussion was held off the record.) 

5 BY MR. FINN: (Resuming) 

6 Q It's our understanding you'd also like to 

7 supply us records relating to the sale of three parcels 

8 of land which you've used to support yourself during your 

9 period of unemployment. 

10 A Yes, and as reflected in my IRS statement. 

11 Q We will certainly accept those at this time 

12 with thanks and thanks again for your cooperation. I 

13 would ask the transcriber to label this packet of 

14 documents ^^^^^H Exhibit Number 9. 

15 (The document referred to was 

16 marked^^^^^H Exhibit Number 9 

17 for identification.) 

18 MR. FINN: Once again, we thank you for your 

19 cooperation. It assists us in assuring ourselves that 

20 your employment status is actually as represented by you. 

21 BY MR. FINN: (Resuming) 

22 Q Just a few last questions. Are you currently 

23 an applicant for reemployment with the CIA? 

24 A I am not, no. 

25 Q Do you have any current intention to seek 



UNCtSSStflD 



678 



U 






125 



1 
2 
3 
4 

5 
6 

7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



employment with the CIA in the future? 

A No, I don't think so. 

Q And finally let me just ask you a few last 
things. Have you been outside the United States at all 
since departing from the CIA? 

A I have been -- actually no, but I've been in 
Puerto Rico about two months ago on business, on personal 
business. But I have not been, no. 

Q And you've had no sources of income during the 
time except from those noted, the disbursement and the 
land sales and other personal savings or interest on 
those savings? You have had no sources of income in your 
period of unemployment? 

A That is absolutely correct. 

Q Your testimony is that you have not assisted 
the former Director of the CIA, Bill Casey, in monitoring 
the activities of private organizations providing support 
to the contras? 

A Absolutely not. 

Q And you have not been in Europe for that 
purpose? 

A No, sir. 




679 



1 

2 
3 
4 

5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 




Q Have you ever heard the name Olmstead? 

A Yes, I have, and it was either Olms or 
Olmstead that Richard Secord noted when we were talking 
about possible foundations, and it seemed to me that the 
name came up in that. In other words, he told me at one 
point, I think when we were having lunch, that he didn't • 
know anybody in that, but then he mentioned the name 
either Olms or Olmstead. When you mentioned it the first 
time we got together, that rang a bell. 

Q What was your understanding concerning the 
nature of that individual's activities? 

A It was made in passing and the only thing — 
it might not even have been Olmstead. It might have been 
Olms. But he mentioned the name of a possible fundraiser 
in that regard, and that was in relationship to the name. 

Q Have you ever used the name Olmstead? 

A No, I have never used the name Olmstead. 

MR. FINN: Well, I think that may be all. We 
thank you very much for your cooperation and for coming 
in without subpoena on a voluntary basis. 



litlCtWtl) 



680 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 



IIN£USS!fitO 



127 



(A discussion was held off the record.) 
MR. FINN: Let's go back on the record just 
briefly to make one further clarification. 
BY MR. FINN: (Resuminc 




Q And therefore your identity in connection with 
the CIA ^^^^^^^^^^^^^^^B is 

A 'It's classified. I've sworn to an oath not to 
reveal that publicly 




MR. FINN: Thank you. 
(Whereupon, at 1:04 p.m., the taking of the 
instant deposition ceased.) 



Signature of the witness 

Subscribed and sworn to before me this day of 

, 1987. 



Notary Public 



My Commission Expires: 



UNCkfcSSffi 



681 




: . ^i^^^a^ A. :c:.afer ,^^ officer before vho^ :aa 

foregoing dapositioa vas ca'<an, do here by cartifv ;ha: -r. a vi:-. ess 
whose cesziTion y appears in c'ne foregoing deposi:iori -jas d-ly svorr. 



3/ 



ME 



; chac the cesciaony of said viiness 



taken by ae Co the best of 3y ability and thereafter reduced to :voewr:.ci: 
under ay direction; that said deposition is a true record of tne tesciaon; 
given by said witness; that I aa neither counsel for, related to, nor 
employed by any of the parties to the action in which this deposition 
was taken, and further that I ani not a relative or anployee of any 
attorney or counsel employed by the parties thereto, nor financially 
or otherwise interested in the outcome of the action. 



MOTARY PUBLIC Ij 



My Commission expires: 



a/W'JO 




%^.l 



^^mtS 



682 



pJo (ZcCt^ 






"^^T^ 



On y'ic,\ 










'< 



J^ ^ V.U. ^•-'?V->oO 



^89 ^"i") -vywr^-ir* 



Partially Declassified/Released on JtS^Pf< 
under oronsions o( E 12356 
6v K Johnson. National Security Council 



UNCLASSIFIED 






V>^<.%i-^ -»^-'V V-^^J^. 



C 5181 



'.^ 













683 



UNCLASSIRED 



6- f. 



r 



I - CL- 3^ To l-cL^Sl 



rJC> Oal^t. 






5^i^) 



UNCLASSIFIED 



684 



UNCLASSiFlEO 



■V. 



-■••<;/ 



MDIOilMlDUH 






'Cotj, 



'llQil 



TO LT. COL. OLIVER NORTH 
FROM : B. F. STUDLEY 
DATE : OCTOBER 30, 1983 



^OOcf^; 




^ 



BS 



0005 



<>:00 AM, Occober 29. 1985 - Washington. D.C. 

Racclvad « phon* call froa ay sourct (rtf . "V") insldcl 

"W" was Inslstcnc chac I convey cht following Infonudon Co you IMMEDIATELY 
as h« was concerned chac Infomadon olghc end up In ch« hands o( che media. 
In cum, chey would confronc you. 



Occober 29, 1985. A>J 



"U" was called co a meccing acl 



^es quescioned "W" abouc che shipmenc chac wenc frorr 

jn June 20, 1985. "W" denied chac his ship was Inc 

che Concras. They Chen informed "W" of che following incrediable evencs. 



ncende^^t 



A man named MARIO DELLAMICO (C 
named RON MARTIN) walked lncor~ 



Dellamico was asking chelr help in gecdn 
Company, aras for Contra*. 




an__a.nns dealer 

cwo weeks ago. 



CO sell Ron Marcin's 



ir was ABSOLUTE LY NOT - ic woul d be against chelr law. Ac 
chac T1S« D«Uaalco gave chc|HmHH|< copy of OUR PACKING LIST 
bearing th# following tnf ormadonT^^^^^^ 



1. Shipmenc Icfc^^^^Hand was received by| 

2. Icealzed Llsc of Inventory. 

3. Ship's Naa« and Date of Departure. 
U. Our Representative's Signature. 



Partially OeclassideS/Released on. 



V rc^Ff 



undei provisions of E 12356 
by K Johnson. National Security Council 



lUMFM. 




^000001 



Suit* 300. 1919 PervwylvanuA^nue.NW./VVh«lwigtt>n. 00. USA. 20006 •(20e)M7.0Sie'Tet«B 904279 GMT waan OC 
C W MTOi QMUM C1iai*r OnWMVWR 3 leouk 



685 



ONClASSIflED 



MEMORANDUM 
PACE VM 




BS 



0006 



^ quest lone^^j'^jH^HJBI^I^^^c ha c sa me morn:. ng "U's" 
rran (who ha ndled shipmenc ac^ was called m byfl|^^^|auchor ic ;<is 



"W" had an imporcant shipmenc in pore and was concerned chey would scop 
shlpmenc. ("U" said to cell you ic is ch« first of flv« you are expecting.) 
"W" latar calltd to say SHIP HAD SAILED. 

"y" was furious that his contact (long and costly to form) c oul d bt blown. 
"U" is concerned about his sensitive shipoent sitting inl^^^^Hport and 
also concerned chat this could become international hcadllna^r^ 



ng list has now gon* froa Washington 
because of Ron Martin's aan, Dellaalco. 




"W" urges you to stop Ron Martin/Dellaalco. 



Dellamico was given packing list by 
shipment . 




chat accepted our 



I am informed chat Ron Martin an c^^m^^^m^^ a re involved in atcempcing to 
force Contras to buy from them. Dellamico dea«nde<^|^^^|scll to Ron 
Martin th« same goods that they sold to us. They reused- they are afraid 
of Ron Martin. 



lis sending a special man to talk to "U" 

November 1, 1985 regarding this entire affair. 



on Friday, 



"W" maintains ha has crisis thsra undar concrol - howavar, is vary concerned 
about Ron tUrcln. 

Meanwhlla - tUrtln's coopany still has copies of our documancs - 



ENCLOSED: 

1. Copies of docuaants dallvarad Col 



Report from ay rcpresancaclva that was 1 
The "Mario" referred to Is Dallaalco. 




by Dellamico. 

CO meet ship. 



3. General John K. Slnglaub has bean advised of this Infonsadon. 



«USS/fJfi) 



6-00000^ 



686 



IfNCUSSIflED 






/■ 



OOSERVATIONS ANO EtPLANAriO'< 




To Whom It May Concern: 

Upon arrival in| 
checked in and phoned' 

Surprised at my presence 

office at UOO hours, July 8, 1985. 
status. 



BS 0007 

J proceeded directly to the '^otel, 




jt "elcomed me -^f^^n I aTrived ;n 1:9 
He. then oriefed me on the vessel's 



On arrival in the port of discharge, the vessel anchored inside the 
harbor. A t_1120. July 9, 198 »1 

one local customs agent , one 
loc al-health ^fficial and 1 w ent aDoard 'via pilot boat. With above personnel 

in the master's office, cu^^^^^^ejed confused 
and asked "Where i^^^^^^^H ^he Port Captain answered^^^^^Hand customs 
seemed satisfied. 

At 1135 customs, health and Agent went ashore and master showed me and 
Port Captain some cargo that he found loose in the hold after sailing from 
the loading port. 

The cargo that was found and the Master's coHKnents are in the Master's 
Report. 

When the vessel docked it began to rain and I was approached by a man »ho 
introduced himself as Mario Hernandez. He was dressed as a civilian, but 
carried a side arm. He spoke fluent Spanish as well as English although 
English seemed his second language and he spoke it with a heavy Spanish 
accent. He represented the receivers of the cargo and was anxious to begin 
discharging. 

Mario claimed that rain would not hurt the cargo and was prepared to sign 
papers holding the ship owner harmless for damage to the cargo incurred in 
discharge during the rain. This became a moot point as the rain stopped and 
discharge beQa^a^^^S^hour^^J^^ 9, 1985. It should be noted that Mario 

known tO^H^m^^^H^^^^^^I a s "Hario O'Amico" and signed his name 
"Mario Rodriguez" to the Master's Report and the Order to Discharge. He 
seemed to Move easily about the heavily guarded and restricted dock area 
giving orden to both "civilian" and military personnel. 

He remained on the dock or aboard the ship at all times during the 
discharge as far as I know. 

At 1210 hours, July 10, 1985, the master, in the presence of the port 
Captain and myself, gave Hario the cargo he found loose. Mario talked freely 
about where th^caro^wa^made and about varios specifications of it. A 
young man inq^^mH^^^^Huniform carried the loose cargo off the ship 
concealed in cloth andpu^^t in Mario's car which was alongside the snip. 



UNCLASSIFIED 



^000005 



687 



UNCLASSIFIED 



BS 



Af'.er completion of the discharge f^ario and I inspected the holds and the 
hatchcovers -ere replaced. ' Later, while checking out of the hotel at the 
discharge port, I saw Mar loan^^^^^e^^^t he had a room there. ^e aswed 
if he could ride Sack ^'4I^BI^^H^H «ith me and said 
waiting in front of the hotel 'or Mario to pack and check out, I observed his 
two Dodyguards arrive in Mario's jeep and enter the hotel openly carrying 
what appeared to be the cargo found loose by the master and given to Mario. 
I followed them into the hotel to Mario's room where they put down the ca^^^^ 
ried "an o's gear to my waiting taxi and Mario and I then departed for^^^H 
^HH|^^ Mario carried an automatic pistol m his belt. 

Ouring the sixty minute ride ^^^|^^|^|^^H ^hd a subsequent dinner we 
had together that night, I learned the followin^about Mario: 

- he was born in North Carolina 

- he has lived m Cent^^Ame^^^for 17 years 
his home is ^BB BBBB^ 
he has a wife an d 'wo childr en in the U.S. 

- he has a wife 

- he has a girlfriend if 

- he prefers Central America and. would not return to 
the states 

- he is not a U.S. citizen (although I thought I saw a 
U.S. passport through his shirt pockat) 

- he is extremely well versed in current events and has 
a vast and detailed knowledge of world politics - 
both the policies and the players 

- he could talk at length about the small arms and 
weapons systems of many different countries 

At dinner Mario also informed me that three latin men were found by "his 
paopla" in a fourth floor room of a hotel near the docks. They had, in his 
"ordtf "alot of sophisticated camera equipment" and were taking pictures of 
the port area. Mario said they destroyed the film and had the men in 
custody. He would not say who had them though. Because of many 
inconsistencies in his story regarding this matter, 1 had trouble believing 
it. 

Other observations regarding Mario 

- approximately 5'8"-5'9" tall 

- approximately 175 lbs. (paunchy) 

- usually wore very thick (1/2") glasses 

- brown hair, advanced receeding hairline 



0008 



UNCUSSIHED 



6^00004 



688 



VNcussm 



8S 



As a final note on Mario, I add my impression of him. I can only reoort 
what he told me and do not submit any of it as fact. While he seemed to have 
an imoortant status and role m the receipt of this cargo and handled the 
mechanics of that job -ell, his character seemed confused. He seemed to 
boast at times about his cosition, but never said what it was. He liked to 
talk and often said more than I thought would be orudent. 1 found h;m 
taiWing to himself at times. He liked to tell stories about himself, his 
travels and his life but they often contradicted each other and I found it 
difficult to believe any of them. 

Without having a thorough understanding of the logistics of this 
shipment, I make the following observations that may or may not be valid. 

1) containerized cargo is more secure, attracts less 
attention, is easier and quicker to handle and could 
be handled in most weather conditions. 

2) there is rail siding on the dock and offers another 
discharging alternative 

3) the cargo was taken by truck tc 
f ma l destination;" why not discharge at 

land avoid many of the security 
problems found~at the commercial docks 



0009 



h./jM. 




M'^f 



Mmm 



^000005 



689 







- =^w 



BS 0010- QS 0018 
G) 00000 bsioD 



690 



ywtiAssife 



1 OBJECTIVE 



^ N 5518 



To craata a conduit 'or maintaining a continuous 'low of Soviet wtapons ana 
technology, to b« utilized by the United States m its suopon of Preedor,, Fijwers m 
• Nicaragua. Afghanistan. Angola. Cambodia. Ethiopia, etc. 



\ 



2. PROBLEM * 

With each passing year, Congress has become increasingly unoredictabie and 
uncooperative regarding the President's desire to suppon the cause of the 
Freedom Fighters, despite growing Soviet oppression. The funds have not bean 
forthcoming to supply sufficient arms necessary for the Freedorri Fighters to win. 
T.*ierefor. m leiu of the necessary funding to support this goal, the 'oiiowmg 3-Way 
Trade IS proposed: 



55^5 



Partially Declassified/Released on _^ f-£3 RF. 
undef provisions ol E 12356 
Hy « Johnson Nalional Secunry Council 



3. PROPOSAL 

COUNTRY 'A'^^ ^^^^^^^Wia capable of producing an ongoing supply of 
Soviet-compatible arms.^^^^^His at the same time trying desparateiy to 
upgrade their own military forces and equipment. They would like to purchase from 
[a wide range of military equipment. 



COUNTRY -B'-^ ^^^^^Wwould like tO Sell tq^^^Hbut^^BKOnomy 
is not c«p«bie of supporting long-term credit or barter agreements. As such, the 
United Statss is the key in the successful 3-Wty Trade. 



COUNTRY 'C: UNITED STATES. The United States is able to provide^^Bwtth 
desired High Technology equipment and information. Based on this commodity, 
the Trade would operate as follows: 




691 



ONcussm 



N 5519 



3 WAY TRADE 



T 



dttV tf fT»W, 

uipmtnt ii 



lowirSs th« purcnas* ot 
Higft Technology from ift« U S 



( 



)d«itv«r arrm to 
rcMnn«i«d ihrougn a 
Trading Company 





692 



4 -RESULTS 



UNCLASSIFIED 




11$ •quipm«nt. which m many casts Sits Stockpiled at present, t 



In return^^^Btceives from the United States equipment and technology mat it 
could not otherwis« afford to purchase. 

receivts much-needed modemlziilon for its forces, thefeby presenting a 
stronger threat to the Soviet Union. In return^^^Hexports an ongoing supply of 
domestically manufaauted arms, as p9r directions from the United States. 

The United States then has at its disposal a large and continuous supply of Soviet 
technology and weapons to channel to Freedom Fighters worldwide, mandating 
neither the consent or awareness of the Oepartment of State or Congress. 

The United States would be in a position to dispense these shipments through a 
neutral Foreign Trading Company, established solely for this purpose. 



3uid only b« aware of the fact that it is to ship to the Trading Company such 
sp«ctfi«d goods at raqutsttd. comparabi* in USD valu* to tha equipment 
rec«iv«d froir^^^^^^Hwould not ba awara of the final destinations of any of 
th« axportad armt. 



3uld oniy b« awart of tha buying powar extandad by the United States for 
US tachnoiogy. again in comparable USD valua to tha equipment sant tol 




tlNCLA.SS!nF.B 



693 



UNtWSIHEO 



Th« Unittd Slatss at present noidS to a policy of providing assistance t(^^^Haa 
goal whicM would b« fonwardtd through this transaction Ukewist, the United States is 
committed to eitending financial and technological assistance ^<^^^^^^^^^|^H 
This too would be accomplished. There are many avenues available regaromg the 
forms of credit which could b« extended to Israel. 

We have received confirmation from^^^^^Han(^H^Hthat they are most 
interested m pursuing their role m this trade arrangement. Upon your encouragement 
and belief that the United States could perform its role, we will proceed witi^^^Lnd 
defining their respective roles and the equipment they are willing to trade. 
~-iis will serve to establish our mitiai parameters of equipf^ent quantities, and the 
proportionate amount of credit required. 



kOi 




694 




»^ss\^' 



a 



HEETlliSS 




JiCHWo srcMft 



>tcor<? 5g5, 




SubJtct 



l*ct 






•^ 1fi27 



L 



i^^H 



Partially Oeclassitied/ReleasfflJ onJ£j^_S9^j 
under provisions o( E 12356 
by K Johnson. National Security Council 



CltNlO^p 



UHCUSSmiB 




4 

crrarT 



ft«<^>pn;H;(i^vJ 



695 



STENOGRAPHIC MINUTES 
VnnwiatiaMVnaSUi 
Not for QaoUtiofi ar 
Duplteatiofi 



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-/r/y-7- 



Joint Hearings 
of the 



Select CommittM to 
InTesti|«t« Covert Annt 
Tnntactioni with Iran 

VA HOUSE OF REPRESENTATIVES- 



Partaili- DeclassmedmeleaseO on V T^/jSTO 

unaerp,o.,s,on3o(EO ,iii "^ 

by K Johnson Na„cnal Secuniy Council 




w 



5?(tf5 



Select Coounittce on 

SwTct Military AMiitancc 

to Iran and the Nicarafuan Opposition 

UNITED STATES SENATE 



UNCLASSIFIED 



OFFICE OF THE CLERK 
OfBec of OfBdal Reportcn 



696 



HZR125000 



UNCUSSIF'ED 



P&GI 193 



KAns> 

11179 Diiactoi ei Cantx'al Zntalliganea , did you actually aaat with 

mao hlB In eonnaotlon with Nleaxagua? 
14181 nr. SICORO. Y*s. 

•4 182 nr . NIKLOS. On how many occasions? 
(4183 nr . SECORO. Thraa occasions. 
14 1814 nx. NIELDS. Hhan was tha ilzst occasion? 
(4185 Hz. SECOXD. A iaw days baioza Chrlstaas 1985, was my 

>4 186 first aaatlng. Z want to his oiflca at Langlay, mat with 

14187 him. 

(4 188 Hr . NIEIDS. How was tha maatlng azzansad? 
(4 189 Hz. SECORD. Ha callad ma In my oiilca and askad li Z 

(4 190 could ba ovaz thaza In a faw mlnutas. Z whaalad zlght ovaz 

(4191 thaza. Z sot In a llttla lata baeausa It was bad waathaz 

(4 192 that day. But ha saw ma anyway. 

(4193 nr. NIIIOS. Do you know why ha callad you? 
(419U nz. SECORO. Latar Z datazmlnad ha callad ma baeausa Kozth 

14 195 had suggastad to hla It might ba a good Idaa ior him to call 

(4 196 ma. but ha. hlmsalf, did call ma. 
U197 nr. NZELDS. Hill you dasozlba your maatlng? 
(4 198 nr. SECORO. Yas . Tha maatlng probably lastad (45 mlnutas 

(4 199 Z would guass. As Z said, just tha two oi us wara thara . 

■4200 Zt was a llttla bit humorous baoausa at tha start oi tha 

U201 maatlng ha was doing most of tha talking and Z was making a 

<(202 faw oommants but wa wara talking about two dlffarant 

11203 countrias, and Z dldn*t raallsa It ior about ilva mlnutas. 



IJNCLASSIFJED 



697 



UNCUSSIFIEO 



NAHI: HIR12S000 PAGE 19U 

itaOM H« was talking about Xxan. and Z was talking about tha 

it205 Nloazaguan aoans/ so ua uaza haalsphazas a part ioz auhlla. 

U206 Tha dizactoz was not tha aasiatt guy I hava avaz 

M307 eoaaunlcatad with, but I hava gzaat raspaot ioz tha aan, X 

4208 want to maka that vazy olaaz to tha coaalttaa. Ha had a lot 

4209 of stzataglo vision. 

4210 Aitaz wa got tha talking past aaoh othaz tha pzoblam 

4211 stzaightanad out. and wa got azound quiokly to tha subjaot 

4212 of Cantzal Aaazica. which was tha puzposa oi tha aaatlng, ha 

4213 was talking about Izan only bacausa ha knaw I had soaathing 

4214 to do with Izan aattaz whioh was not yat discussad and Z 

4215 won't gat into that zight now. Ha talkad about tha 

4216 situation in latin Aaazioa. 

42 17 I told hia that Z was net an axpazt on that azaa, that I 

4218 ialt inadaquata about that azaa baoausa Z zaally didn't hava 

4219 any iizst-hand knowladga oi tha gaogzaphy> tha paopla oz 

4220 anything alsa. But ha was wall awaza that wa waza czanklng 

4221 up his aizliit opazation, knaw oi its iapoztanea. 

4222 Ha askad aa ioz ay astiaata oi tha situation, by that ha 

4223 aaant tha ovazall ailitazy-politioal situation, and I hava 

4224 hiB a bzlai axplanation. and Z told hia that among othaz 

4225 things that Z ialt that tha oontza had no ohanoa oi 

4226 pzavailing. nona whatsoavaz. ii wa didn't gat this aizliit 

4227 opazation into tha ilald. and avan with it, avan ii wa waza 

4228 vazy suocassiul Z had gzava rasazvations about thaiz ability 



UNCLASSIFIED 



698 



UNCUSS\F'XO 



NAM' HII125000 UllVfc»^""^^" fXQt 195 

||229 to %ohiav* any allltazy vlotozlas. 02 eouzsa — any 

14230 slsnlileant ailitazy vletozlas. 

■4231 Z didn't >•• any zaal novas to ozaata a vlabla southarn 

<4232 iront. It navaz was dona suecatsiully thazaaitaz. 

■4233 Xlthoush Z knaM thay had aany thousand aoza aan than thay 

ii23i4 could succassiully aza and tzaln. I didn't saa tha logistics 

•4235 capability, I didn't saa tha intalllganca oapablllty and I 

>4236 did not saa tha laadazshlp which is going to ba zaquizad ioz 

<4237 a daclslva ailltazy vlctozy thaza. 

14238 Oi couzsa. It is posslbla that sufiiclant pzassuza could 

U239 ba ganazatad by kaaplng thaa in tha iiald to bzlng tha 

I42U0 Sandinistas to tha tabla. Z baliava ha shazad ay vlaw of 

)42i4l that situation, at laast at that tiaa. 

142142 Xa told aa that thay waza vary appzaoiativa oi what I Mas 

(42*43 doing, and ha said Z had his adalzation and askad what ha 

i42<4i4 could do, and Z axplaln to hla that I naadad intalllganca 

<42*45 Iniozaatlon, as Z just discussad with you gantlaaan. Xa 

i42>46 took soaa notas on that> ha was non-coaaltal, ha didn't 

<42<47 pzoaisa aa anything. 

U2>48 But ha said ha would look into it. Just as Z was laavlng 

i42<49 that paztieulaz discussion, Z said to hla, Hz. Oizactoz, if 

14250 and whan you gat youz hunting lioansa back — this was a kind 

■4251 oi ozuda way to zaiazzing to hopad ioz oongzassional 

(4252 action — whatavaz assats waza ozaating zight now — by that Z had 

U253 in aind tha aiz ilald which was just baing sozatohad out and 



UNCLASSIFIED 



699 



UMCI^SSIFIEB 



NAni> 111125000 ^JllWfc*""—^ fxQx 196 



M2SU 
14255 
(4256 



our ail lift oparatlon, and tha ■atailal that want tilth It 
la youzs, just walk In and it is youza. That Z atsuza you. 
la said, thanks vary such, and I laft. 



UNCLASSIPPH 



700 



U257 
U258 
H2S9 

uafto 

•1261 
M262 
(•263 
II26M 
M265 
11266 
it267 
11268 
i«269 
il270 
M271 
4272 
U273 
11274 
4275 
4276 
4277 
4278 
4279 
4280 
4281 



RIX125000 

RPTS DOTSON 
OCnk BAMNAK 



PAGC 197 



u 



nclass!f:ed 



Hr. NXILDS. You war* zAfarxlng to tha assats you wata 
davaloplng In eonnactlon with this alz za-supply opazatlon? 

Hz. SECOXD. That Is oorzaot. As Z said aazllaz, it was 
not a pzoilt-aaklng plctuza ioz us. Ha waza just tzying to 
hold tha Una until ua could gat out oi thaza. 

Hz. KI2LDS. Hhan was youz naxt saatlng with Dlzactoz 
Casay? 

Hr. SKCOKD. Tha naxt saatlng was at ay za^uast and It uas 
a vazy bzlai aaatlng that took plaoa In — Z ballava It took 
plaoa in aazly Fabzuazy *86. I don't hava any notas on it. 
but Z zaaaabaz It ialzly vail. 

nz. KZELOS. Mow was that sat up? 

Hz. SZCOKD. Z oallad Nozth and askad hia to sat it up, 
and ha did. 

Hz. MZELSS. This ona was at youz zaquast? 

Hz. SKCOKO. Hy zaquast. Z want to saa hia bacausa I was 
unhappy, and Z told hia, Hz. Oizaotoz, you and Z aza both 
too old to wast* tiaa baating azound tha bush. Z hava coaa 
haza to oeaplain. 

Coaplaln about what? 

Z laldf ooaplaln about youz oxganlsatlon. 

What ozganlsatien? 

Tha Cantzal — tha task iozoa, X said. 



ONCLASSiFIED 



701 



UNClftSSlF?EO 



NAKI> RZ11125000 w-- — — pj^gj ^^^ 

ua82 . !• tald. what tmsk iotosT 

4283 X said, tha Cantxml kaaxioa task ioxoa. 

I428M Oh, that ona. What's tha yzoblaa? 

M285 I said, tha pzoblaa Is Z'a not gattlng any support. i 

14286 wantad Intalllganoa Iniozaatlon, guldanoa* iihatavar support 

M287 you can glva us. I want. Ha want avary bit oi support wa 

>4288 oan gat iron you. Znstaad what wa ata gatting Is a lot oi 

U289 quastlons about tha natuza ei Gadd's organization, hou is it 

•1290 organlzad. who owns it. who has tha shaza. what Saeord is 

■1291 doing. It was lika an invastigation oi ouz ozganiiation. 

<4292 Thay wazen't suppoztlng it. 

M293 I didn't naad to ba invastigatad, I naadad to ba 

>t29<l suppoztad. and that was tha natuza of ay ooaplaint. and Z 

14295 statad it iizaly. Again ha said ha would look into it. Tha 

11296 aaating was a bziai aaating. 

•4297 Tha last tiaa I saw tha dizaotoz was quits a bit latar. 

4298 and Z'b sozzy but I cannot tall you what aonth it was in. I 

M299 think it was bafoza tha Hay jouznay oi Hz. HoFazlana to 

(4300 Tahazan in '86. but it sight hava baan aitaz. I 'a not sura. 

t430 1 But it was about that tiaa izaaa. 

14302 This aaating oonoaznad itsali also with oontza aattars. 

•4303 hayMnad to ba in Kezth's oiiloa disoussing soaathing whan 

U30U tha dizaotoz callad Colonal Kozth, and Nozth said that was 

14305 tha dizaotoz, ha wants to saa aa. would you Ilka to go with 

14306 aa. 



UNCLASSIFIED 



702 



UNCLASSIRED 



KkHI> HI«iaSOOO w--'- ^j^gg ,,, 

<«307 I thought u* war* laavlng tha building, but u* uazan't. 

ci308 U* M*z« just going azound tha ooznaz to anothaz eiilca whaza 

U309 ha happanad to ba. tha dlzactoz happanad to ba. z want In 

i<310 and ha said, good to saa you again, Ganaral. 

K311 North and Z tat down with hla and tha subjaet was rmlsad-- 

14312 and Z ballava this was a continuing discussion Colonal Korth 

>I313 was having with tha dlractor, bacausa ha want right Into tha 

iiSIU Blddla of a problaa, and that was tha growing shortaga oi 

143 IS funds to support tha eontras. 

1316 North said that this was baooalng a raally orltloal 

it317 problaa. that donations to tha causa wara tailing off, thay 

||318 hadn't baan aatarlallslng as thay should, thara wara 

ii319 shortagas In virtually avarythlng, avan food by this tlma. 
M320 Tha dlraotor statad that ha wasn't at all confidant that 

>(321 thay would ba abla to gat a naw bill out of Congrass in too 

•4322 short a parlod of tlaa. Ha said that soaa paopla ovar hara, 

>4323 aaanlng tha axacutlva of fleas, saaaad to think thay wara 

>432(( going to ba abla to gat a naw bill rathar rapidly off tha 

>4325 Rill. But ha didn't shara that vlaw. 

<4326 North turnad to aa and askad aa to glva ay astlaata of the 

■•327 situation, so Z had to glva ay astlaata of tha situation 

1(328 afalB. So Z ran through fuiekly what I thought Z knaw about 

1329 tha situation at tha tiaa. Z told hia that this airlift 

■1330 oparatlen, which was ay araa of ceaearn, was also short of 

11331 funds, wa naadad a lot of things, wa naadad a lot of naw 



UNCLASSIFIED 



703 



^^OUSSIFlkd 



NiHI> H1I12S000 VffuLll.WirvPr^ PA" 200 

11332 a^ulpaant 

14333 Z wantad In paxtloulaz to buy soaa Initial navigation 

>(33M aqulpaant ioz tha naw alzplanas but thay waza vazy 

14335 aKpantlva. Ha didn't hava good waathar zadaz althaz. and so 

•4336 on. 

■4337 Casay askad aa how auch aonay la naadad. and I said, wall 

>4338 It dapands on what pazlod oi tlaa you aza talking about. 

■4339 Unlass tha Govaznaant. tha U.S. Govaznaant, gats back Into 

■43(40 tha suppozt oi tha oontzas, you knoM, wa aza not going to 

M341 aaka It. 

I43M2 That Mas tha aassaga I uantad to lapazt. It had to ba 

i43<43 dona falzly soon, baoausa thasa pzlvata aiiozts. whlla thay 

*43i4i4 can bzlng a llttla bit. thay cannot supplant tha kind oi 

*4345 aiiozt that can ba put iozth by a nation. No pzlvata 

i43<46 ozganlzatlon avaz has anough zasouzeas to do that kind oi a 

U3U7 job. 

i43>48 I hava alzaady aantlonad Intalllganca and thaza aza othaz 

>43>49 azaas . Ha said. wall, a iaw aonths. tha and oi tha suaaaz. 

14350 soaathlng Ilka that, I guassad. I said I thought It would 

•4351 taka about «10 Billion. I thought. 

(4352 la said «10 alllion. tlO allllon, and than ha aantlonad 

>4353 thm eeuntzy which ha thought alght ba willing to donata this 

<i35>4 kind oi aonay. But than ha said, but Z can't appzoaoh thaa. 

14355 Hhy. Z don't knew. Hhy ha couldn't appzoaoh thaa, I don't 

(4356 know and ha didn't say. But ha said that two oz thzaa 



UNCLflSSIflED 



704 



UNCLASSIFIED 



NAHIi MHiaSOOO Wiww—"-'—— p^^j ^^^ 

|<3S7 tlaas. ind th«n h* said, than ha lookad at aa and aald. but 

U3S« y»» oan. 

(4359 tnd Z said, Hz. Dlzaotor. X'a net an oiilolal oi tha U.S. 

11360 Qovaznaant. X don't think thasa paopla aza paztloulazly 

^361 Intazastad In solicitation izoa pzlvata eltlzans. I think 

ii362 that Hould ba vazy ioollsh. 

14363 And than ha ausad about It again and Kozth said soaabody 

<436i| battaz daan wall stazt looking Into this thing zlght away 

||365 bacausa It Is a zathaz dasparata situation. 

||366 Tha dlzaotoz statad that ha ballavad that 6aozga> aaanlng 

14367 tha Saozatazy oi Stata> oould aaka suoh an appzeaoh* though. 

14368 and that uas tha bottoa Una. Ra said ha would spaak to tha 

14369 Saozatazy of Stata about this aattaz. 

14370 That was tha last tlaa X avaz aat with tha dlzaotoz. 

14371 although again ha thankad aa ioz tha aiiozts that X had baan 
H372 Involvad with. 

U373 nz. NXZLDS. Any othaz govaznaant oiilolals. othar than 

143714 tha onas you hava aantlonad ahd Ollvaz Kozth. who lant you 

>4375 suppozt In this opazatlon? 

1437 6 nz. SCCOIS. Nona that X oan thlnX oi zlght now. 

14377 Hz. NIIIBS. All zlght. 

14378 X would Ilka to zatuzn to tha XI-H3 aassagas. Tou should 
U379 hav« en* In izont oi you datad H-28-86. 

14380 Hz. SICOtB. Okay. 

U381 Hz. KXIIBS. Who 1« that izoa and who Is It toT 



«NCIASSIFIED 



705 



10 -pao es 



^ 



d 






706 



£Xi4iBiT* ^t 



707 



ALFRED C. DEVENPORT, Official Bx«ain«r, Toronto 



vmmm 






CONFIDBNTIAL INTERVIEW DEPOSITION 
of 

of 
GBORCrrOWN. GRAND CAYMAN 

CCSOUCTgP BY; 

A REPRBSBNTATZVB OF THI UNITBO STATES SBNATB SELECT COMMITTEE ON 
SECRET MILITARY ASSISTANCE TO IRAN AND THE NICARACUAN OPPOSTION 
APPOINTED BY THE UNITED STATES SENATE 



-and- 



A REPRESENTATIVE Of THE SELECT COMMITTEE TO INVESTIGATE COVERT 

ARMS TRANSACTIONS WITH IRAN 

APPOINTED BY THE 

UNITBO STATES HOUSE OF REPRESENTATIVES 



-oOo- 



H«ld bcfora ALFRED C. DEVENPORT, Official 
Bxaalnar, in his Chaabars, Suita 305, Boardroon, 65 
Queen Street Weat, Toronto, Ontario, Canada, on the 
29th 4«»oCA«vil, 1914 



mmm 



COPY N0_ 



708 



ALFRSD C. 




ficial Examiner, Toronto 



li 



APPBARAWCESi 



cpnrn ' ^ ^ ""^^ 



JOHN A. GAMBLE, Q.C. 
Barrister & Solicitor 
Counsel for 
Mr. Donald Frassr 



Gambia & Garba 

7507 Kannady Road 

P.O. Box 296 

MARKHAM, Ontario, Canada 

L3P 3J7 



JOIL LZSKBR, Bsqulra 
Associata Counsel 



United States Senate, 

Select Comaittee on Secret Military 

Assistance to Iran and the 

t 
Nlcaraguan Opposition 

901 Bart Sen^ate Office Building 

WASHINGTON, D.C. 20510 



MS. PAMBL.A J. NAUCHTON 

Staff Counsel 




Select Conaittee to Investigate 
Covert Aras Transactions with Iran 
U. S. House of Representatives 
H-419 The Capitol 
WASHINGTON, D.C. 20515 



^■B Declassified/Released on il i ^N 88 
under provisions ot E 12356 
by K Johnson, National Security Council 




709 



ALFRBD C. DEVBNPORT, Official Examiner, Toronto 



mmm 



APPBXRAWCIS. CONTINUBD; 

DANIEL C. DRBIBBLBXS, JR. F«d«ral Bureau of Investigation 

Special Agent Accountant 7142 Aabaasador Road 

BALTIMORB, MD 21207 



lb 



MS. VICKI BBBN 
Associate Counsel, 
Appointed at the Request 
Of U.S. Attorney General 



Office of Independent Counsel 

555 13th Street N.V. 

Suite 701 

WASHINGTON, D. C. 20004 



CST. L.D. (Lionel) LIZOTTB Royal Canadian Mounted Police 
National Crime Intelligence 225 Jarvis Street 
Section N.C.I.S. Toronto, Ontario, Canada 



- oOo - 



mMm 



710 




frrmfTniiiiTTriiii o. fraser 



INDEX OF EXAMINATION 



WITNESS. D. FRASBR ; PAGE NO. 



By Mr . Lisk«r 7 - 38 



By Ms . Nauflhton 39 - 71 



By Mr. Li«k«r 71 - 79 



By Ma. Naughton 79 - 80 






mm^ 



711 



(if ■'" 

ALFRED C. DEVENF&Hfr'cTfTrei'A'ISIffcminer, Toronto 



INDEX OF EXHIBITS 



EXHIBIT NO. DBSCRIPTIOW PAGE WO. 



List of Naacs 63 



wuBim 



Id 



712 



ALFRED C. I^B^'y^^ml.f^pAlFvrJl"'^ Toronto 

"^"'T^rNTTftlll D- PKASER 

1 RCMP, Toronto. 

2 MR. GAMBLE: And I'm John Gamble, Counsel 

3 for Mr. Fraser. 

4 MR. LISKBR: At the outset, I'd like to 

5 make one statement for the record, and Z believe 

6 we'll have another statement: That is that 

7 nothing that is asked of you this morning, by 

8 either the Rouse or the Senate, will in any way 

9 be derived from any information received from 

10 immunized witnesses. In particular, nothing will 

11 be asked of you regarding Albert Hakim, or 

12 documents supplied to the various committees by 

13 Mr. Hakim. 

14 MS. NAUGHTON: Pamela Naughton, for the 

15 House Representatives. We just want to put on the 

16 record that this is a Senate deposition, not a 

17 House of Representatives' deposition. 

18 I'll be participating, but we'll be 

19 proceeding under the Senate rules. 

20 MS. BEEN: Vicki Been from the Office of 

21 Independent Counsel. I'd just like to put on the 

22 record that we have received assurances from both 

23 the House and the Senate that no immunized 

24 materials, including the record — any records or 

25 testimony from Albert Hakim — will be used in the 



UNOHSMiED 



713 



^iMIiEnoMotttc 



ALPRBD C. DEVBNPOl 

( 9 I IP HMI 1M >L ) 0. FRASER 

1 DONALD FRASER 

2 waa duly sworn by AlCr«d C. Dcvenport, 

3 Official Bxaainar, to tastlfy to th« 

4 truth, the whol* truth, and nothing but 

5 truth in this Intarvlew Deposition. 

6 -0- 

7 MR. LZSKBIt: Good acrning, Mr. Praser. My 

8 naaa is Joal Liskar. Z'a an Associate Counsel 

9 with the Sanata Salact Coaaittaa on Sacrat 

10 Military Assistance to Iran and the Nicaraguan 

11 Opposition. 

12 He have several other individuals in the 

13 rooa with us, and I'd appreciate it if each Nould 

14 identify themselves for the purposes of the 

15 record. 

16 MS. NAUGHTON: Panela Naughton, Staff 

17 Counsel, with the House of Representatives, 

18 Select Comnittee. 

19 MR. DRBIBBLBIS: Dan Dreibelbis, Special 

20 Agent, PBI, assigned to Independent Counsel, to 

21 Judge Lawrence Walsh' investigation. 

22 MS. BBBN: Vicki Been, Associate Counsel 

23 with the Office of Independent Counsel, Judge 

24 Walsh. 

25 MR. LIZOTTB: Lionel Lizotte, with the 



UMftJffiSMElP 



Declassitie<i/Releasecl on 1 1 J AN 
under orovisions ol E 12356 
Johnson, Nalional Socuniy Council 



714 



PtilSSIflEO 

ALFRED C. DEVfNPORT, Official Bjcaminer, Toronto 

(rymwinanTiTii i o. frasbr 



1 process of their questioning. 

2 MR. LISKER: Yes. Let me just add one 

3 thing to what I said previously. We may ask you 

4 questions about Mr. Hakia, but nothing from Mr. 

5 Halcia's iaaunized testimony. 

6 MR. GAMBLE: Now, if I aay just outline the 

7 series of questions and answers in the routine 

8 that will be followed today — !'■ not aware of 

9 the consequences of excluding questions that aay 

10 arise out of iaaunizad witnesses' previous 

11 testiaony or depositions — but the purpose of 

12 this series of questions and answers, to be aade 

13 of and given by Mr. Fraser, is that he may be 

14 given an opportunity to respond to a legitimate 

15 series of investigations undertaken by agencies of 

16 tha United States Governaent or Representatives of 

17 tba United States Legislature, in both of its 

18 branches. The purpose being, on one occasion, to 

19 provide answers to questions related to the Secret 

20 Military Assistance to Iran and to the Nicaraguan 

21 Opposition, and not with respect to matters of a 

22 general nature related to the business of Mr. 

23 Fraser or his private or personal life. 

24 It will be Mr. Fraser 's intention to answer 

25 all the questions that he can with respect to this 



mmm 



715 



mmm 



ALFRED C. DBVBNPORT, Official Examinar , Toronto 
( ei! I HPH)lH i H»ljl D. PRASER 

1 matter, tha spacific subject aatter of 

2 invaatigation. 

3 But it ia aincaraly hopad — and as a matter 

4 of fact, it is ona of tha conditions of our 

5 arranging this series of questions and 

6 answers — that there be a single interview. 

7 Now, I would like to point out that if, 

t subsequently, for acae reason, which aacapes ae, 

9 SOB* iaaunized witnesses' evidence sight give rise 

10 to answering questions in siailar circuastancea, 

11 such as this, at another tiae, Mr. Fraser would 

12 object to it. So that Z hope that all questions 

13 that is wished to be asked of Mr. Fraser, at one 

14 point or another, during this investigation, will 

15 b« asked. 

If Z notice Paaela Naughton'a coaaants with 

17 respect to eaploying the Senate rules. I would 

18 sincerely hope — and it was the intention when 

19 this aeeting was arranged — that the Select 

20 Coaalttee of the U.S. House of Representatives, 

21 dealing with governaent aras tranaactions with 

22 Iran, would be given an opportunity to ask 

23 questions of their own. 

24 It is not Mr. Fraser 's intention to return 

25 again and anawar ^ua'^^U^f^*^ ^*^ ^* asked by 



and anawar auestion^^h 



716 




ALPR8D C. DBVgNPORT, Official Examiner, Toronto 
( ( i mMgl Pt lPJIOh ) 0. FRASER 



1 

2 

3 

4 

5 

6 

7 

« 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



any Repr«s«ntative of the U.S. House of 
Representatives' Select Coainittee to Investigate 
Covert Aras Trensactiona with Iran. This is an 
opportunity for the House to do so. And if the 
Rouse chooses not to do so, it will not be Mr. 
Praser's intention to return and answer any other 
questions. 

This does not, of course, aean that he would 
not respond to any invitation to appear before 
either coanlttee of the U. S. Legislature. 

Mow, having said that 

MR. LISKBR: Excuse me, Mr. Gamble. 

MR. OAMBLI: Yes. 

MR. LISKBR: You said Senate rules. I 
think you meant to say House rules. 

MR. GAMBLB: I thought that Miss — rather, 
Paaala Naughton said that they were going to 
employ the Senate rules. 

MR. LISKBR: Hell, we are employing Senate 



rules. 

MR. OAMBLB: 

MR. LISKBR: 

MR. GAMBLB: 
that's what I thought I said 

MR. LISKBR 



That's what I meant. 

I'm sorry. 

That's what I meant, and 




717 



UWUPED 

rEMPORT, Official Exaninci 



ALPRID C. DEVEMPORT, Official Examinar, Toronto 
(c;i>rTi9«innAL) o. frasbr 

1 MR. GAMBLE: Yas . I just didn't understand 

3 the consaquancas; that if that meant that the 

3 Housa was — and I'm talking about the Rouse of 

4 Representatives — was not about to ask their 

5 questions, then it bothers ae, because this is the 

6 one single opportunity that tha Rouse of 

7 Represeatatiyes is going to have, because it was 

8 on that understanding that we arrange this 

9 aaetlng. So having said that — Mr. Lisker. 
10 MX. LXSKIR: Thank you, Mr. Gaoible. 

11 

la BXAMINATIOM BY MR. LISRBR ; 

13 Q. Mr. Fraser, will you tell us what your 

14 profession is? 

15 A. !'■ a businessaan; foraally an accountant 

16 froa Canada. 

17 g. And what is your background in business? 

18 A. I'a a chartered accountant. 

19 Q. Sorry? 

20 A. X'a a chartered accountant. 

21 Q. A chartered accountant? 

22 A. The saaa as a CPA in the United States. 

23 Q. X see. How and when did you first come in 

24 contact with Mr. Adnan Khashoggi? 

25 A. I net him once, I think, at a — in Monaco, 



UIWI!iSStRED 



718 



(C au yi eiEU T iJUj ) d. fraser 



1 at the casino, for a brief period of time, shook hands 

2 with hi«, in 1980 or '81. But I don't think he'd 

3 reaember that aeeting. And than I met him for the 

4 first tiae in March of last year, March of 1986. 

5 Q. Prior to March of 1986, did you, to the best 

6 of your knowledge, have any business relationship with 

7 either Mr. Khashoggi or any enterprise under his 

8 control and direction? 

9 A. No, Z didn't. 

10 Q. At the present tiae, will you identify those 

11 businesses or business organizations or 

13 entities — partnerships, corporations, so 

13 forth — with which you have an interest, in which you 

14 have an interest, in which Mr. Khashoggi also has an 

15 interest at this tiae, or has had an interest in the 

16 past? 

17 A. I think the only one that I'm Involved with 

18 is Skybigh Resources Liaitsd, which is a public 

19 coapany, traded on Vancouver, in which he is the 

20 Chairman, and I'm a director of that company. 

21 Q. What is the relationship between the Triad 

22 group and Skyhigh Resources? 

23 A. 1 don't think there is any relationship, as 

24 far as I know. 

25 Q. Did yo« ever have a relationship with the 



\immm 



719 



"il8i*ffifiSR^,Vi, 



AL?RBD C. OWBOTORTt Off vctil TraaTiner, Toronto 

1 Triad group or Triad U.S.? 

2 A. I was president at on* tiae ot Triad 

3 Aaarica. 

4 Q. And whan was that? 

5 A. I rssl^nsd about thrs* — I think about 

6 thrss wssks ago. 

7 Q. And wh«n did 70U b«co«« president? 

• A. Two tines. I becaae president, Z think, 

9 around the end of March, for a period, to the end of 

10 May, and then — there will be docuaents on file in 

11 Salt Lake. I don't know the exact dates. And then I 

12 becaae president again, I think, around the 1st of 

13 September until this tiae, Z resigned now. 

14 Q. Three weeks ago. Under what circunstances 

15 did you becoae president? 

16 A. What do you aean? 

17 Q. How did you coa* to be president on those 

18 two oecaaions? 

19 A. The coapany was troubled. Z was asked to 

20 coae on to try to solve the problems. Z aade certain 

21 recoamendations, which people wouldn't accept at 

22 this — in the first instance. And then the second 

23 tiae Z cane on, they accepted soa* of the 

24 recoaaendations, and reduced the staff. And Z put the 

25 company Into Chapter 11, whatever it is. 



UNtlJll89lliKD 



720 



UliiftSSIlD 

ALFRED C. DEVENPORT, Official Examiner , Toronto 

r) D. FRASER 



10 



Q. And who askad you to become president? 

A. Who asked me? Mr. Khashoggi. 

Q. And what did he tell you at that time? 

A. I'a sorry? 

g. What did he tell you at that tine, to 
persuade you to do this? 

A. Oh, Z thought it was probably ay — it 
didn't take aueh persuasion. Z think Z was caught up 
with being involved with Mr. Khashoggl, and having a 

10 chance to run a very large organization during that 

11 time. 

12 Q. Hell, what is your relationship with 

13 Skyhigh? 

14 A. Z'a a director of Skyhigh and an investor. 

15 Q. And that begins in March of 1986, you said 

16 previously? 

17 A. No, Z've been — Z was a director for about 

18 two yaars. 

19 Q. Z see. How did you becoae a director of 

20 Skyhigh? Did you have a prior relationship with the 

21 company? 

22 A. Oh, yes. Z have been involved with several 

23 coapanies with a Mr. Philp (phonet.). And he is 

24 president of Skyhigh. And Skyhigh was a saall resource 

25 company, and Z'a involved with a number of companies. 



mmm 



721 



.IfJMMElI 



AliFRBD C. DBVEh 

(C0 H|r tB8 imAIJ l D. PRASER 

1 Q. And do you have a capital position with 

3 Skyhigh, apart from your directorship? 

3 A. Yes. !'■ the largest shareholder in that. 

4 Q. How many share* does that represent? 

5 MR. GAMBLS: Oh, I don't know if that's 

6 aaterial. 

7 THB WITNBSS: It's public knowledge, 

8 anyways . 

9 MR. GAMBLB: Well, I still don't know that ' 

10 it's material. 

11 MR. LISKBR: Well, I'm just simply trying 

12 to get some understanding of his relationship with 

13 Rbashoggi's enterprises and the depth of his 

14 commitment to Mr. Khashoggi. 

15 THB WITNESS: I think Mr. Khashoggi has a 

16 very small position in Skyhigh. He didn't get 

17 involved until the summer of '86. 

18 BY MR. LISKBR ; 

19 Q. So, do you want to answer the question? 

20 A. I don't know off the top of my head. It's 

21 over a million shares I have. 

22 g. And apart from Skyhigh, and these two 

23 positions as president — there are two periods of time 

24 in 1986 and later in 1987 with Triad — do you have any 

25 other relationship with Mr. Khashoggi, business 



11 



umsm 



722 



mmm. 



ALFRED C. DKVKf?dWP,'bftfhTil RiAflrtSr , Toronto 

(CimrFHIMMUTiITi) D. PRASER ^ 

1 relationship? 

2 A. Hall, there's lot of ~ like I was 

3 explaining to Mr. Gaable, when I resigned from Triad, I 

4 resigned both tiaes on a blanket resignation, stating 

5 that any coaipanies that I was involved with, that I 

6 would either sign docuaentation, or this resignation 

7 was resigning froa all the coapanies. 

8 The Triad group and Mr. Khashoggi's 

9 coapanies, they're — like the lawyers would put you on' 

10 as directors, and Z wouldn't know which companies Z was 

11 a director of or an officer of. And so when Z wanted 

12 to be indeanified, Z asked for a blanket resignation 

13 froa all the companies. And, also, all docu- 

14 menta — like Z signed documents as high as this roof, 

15 and Z just asked the lawyers for their okay, and Z 

16 would ask to sign it. So Z wouldn't have any idea 

17 what — you know, what coapanies Z was an actual 

18 director of. 

19 Q. Which lawyers are you relying on for this 

20 advice? 

21 A. The Salt Lake lawyers. Like the Triad 

22 laywers that were 

23 Q. And the naae of the fira? 

24 A. The last one was Prince, Yates (phonet.). 

25 And Z think |(itwiat« i)#tA^A t&mf&s — ^ can't think of 



mmm 



723 



UptWD 

BVBNPORT, Official Examin 



ALFRED C. DBVBNPORT, Official Examiner, Toronto 

(CQusiaansiXiJ o. eraser 

1 the nane of it. 

2 HK. LISKBR: Would it b« possible, Mr. 

3 Ganble 

4 THE WITNESS: It's the main one for Triad 

5 up until last suaasr, I guess. 

6 MX. LISKSX: Would it be possible, Mr. 

7 Gamble, to provide the committees — and I suppose 

8 the Independent Counsel — with a copy of the — 

9 of some document which incorporates the names of 

10 these companies, the various companies? 

11 MK. GAMBLE: It wouldn't, because as Mr. 

12 Fraser has just explained 

13 THE WITNESS: Sorry, I don't have any 

14 MR. GAMBLE: As Mr. Fraser just explained, 

15 he doesn't know what companies they are. 

16 BY MR. LISKBR ; 

17 Q. Okay. They didn't provide you with copies 

18 of what 

19 A. Well, what you could do, I'm sure — a Mr. 

20 Art Miller, when he went to your committee, the 

21 committees — all those documents were subpoenaed at 

22 one time. 

23 Q. Okay. Now, as president of Triad during 

24 those two periods of time, what were your 

25 responsibilities, specifically? 



wmmm 



724 



ALFRED C. DEVENP 



4P0RT, 0lT*iaT11Wminer 




14 



1 A. I was th« general supervisor of the group ot 

2 companies; mainly trying to reorganize, cut baclc the 

3 debt, and try to, I guess, eliminate companies that 

4 weren't needed. There was a real mess. Money was 

5 being wasted, and the company was going nowhere fast. 

6 Zt was going downhill very quickly. 

7 g. Now, vhat is your relationship with Vertex 

8 Pinanc«s , S . A . ? 

9 A. In which way? Z was a director at one 

10 point. 

11 g. A director? 

12 A. Yes. 

13 g. And how many directors 

14 A. I 'a not at liberty to answer that. 

15 g. And what does Vertex Finances, S.A. do? 

16 A. Again, that's a Cayaan Island company. I 

17 don't know if I can answer that. 

18 MR. GAMBLE: Th« problem — and you've run 

19 into this before — I think all of you have — is 

20 that Mr. Fraser is a resident of Grand Cayman, and 

21 he is required by the secrecy laws of that country 

22 not to make disclosures of any information that 

23 relates to Grand Cayman corporations. 

24 I've spoken to Mr. Fraser about this, and in 

25 the event that those companies are his own 




725 



JJlMiKD. 



ALFRED C. DBVgNPCRT. Off I ?1 fl "WcTlMfr , Toronto 

15 



^L) D. PRASBR 

1 peraonal corporations, • hundred per cent 

3 controlled by Mr. Fraser, Z see no difficulty in 

3 releasing that information. 

4 If there are other people involved, however, 

5 I think that it would be a breach of their secrecy 

6 lawa to aalca disclosures of that information, and 

7 Z have advised hia accordingly. He's very 

8 concerned about his position in Grand Cayman. 

9 THB WITNESS : Hell, I think there is a 

10 treaty between the United States and Grand Cayman 

11 that you can request the information through the 

12 treaty. But a lot of information you've asked 

13 me, even if I do know it or don't know it, I have 

14 to answer the exactly the same, so you're going to 

15 get the impression that I may know some 

16 information, which I don't. 

17 BY MR. LISKBR: 

18 Q. How about Buro Commercial Finances, B.V.? 

19 K. That's my own corporation. 

20 Q. Can you tell us what that company does 
31 and — 

33 A. It's basically just — it's an investment 

33 company which holds my own investments. 

24 Q. It's a holding company? 

35 A. Holding company, basically. 




726 



.Wiill 



ALFRBD C. DBVBHPDXT .^^fflcla 1 Exajniner, Toronto 
(CumiUkNTlAD D. PRASER 

1 Q. A personal holding company? 

2 A. Parsonal holding company, and managamant 

3 company for aoma othara. 

4 Q. Doas Euro Coaaarcial Pinancaa, B.V. have any 

5 relationship with the Triad companies? 

6 A. I originally made a comaitment to advance 

7 nine million dollars to Triad America. And the first 
• time when I went in, X advanced — started advancing. 
9 I advanced a million dollars. Then I advanced 

10 subsequent advances, which ended up being one million, 

11 seven hundred and sixty thousand. X stopped the 

12 advances when X saw that the money was — that it 

13 was — when I resigned as president. Like there was 

14 no — and X took substantial collateral. For that X 

15 took the Triad Energy stock as collateral. 

16 Q. Who solicited those loans Crom Euro 

17 Commercial Finances? 

18 A. Xt was Mr. Khashoggl. 

19 Q. And when was that? 

20 A. That was in March, when X was president. In 

21 March. 

22 g. March of 1986? 

23 A. Yes. 

24 Q. So that was when you initially assumed the 



16 



25 presidency? 



umeiiBeinED 



727 



ALFRED C. DEVENPORT, Official Examiner, Toronto 
(cUHfiUtNliAL/ ' D. ?RASER 

1 A. Right. 

2 Q. Has that a condition to your assuming the 

3 presidency? 

4 A. That was part of it. It was part of the 

5 conditions of getting a loan, yes. 

6 Q. In other words, you were seeking to assert 

7 your nanageaent skills over a company which was to 
• become indebted to you? 

9 A. Right. 

10 Q. In the terms of overall indebtedness of 

11 Triad, where would a million, seven hundred and sixty 

12 thousand dollars fit in the scheme of things? 

13 A. Very small. Very small. 

14 Q. Oo you know what the total indebtedness of 

15 Triad was 

16 ' A. Not at the time, no. 

17 Q. — at the time of your departure? 

18 A. It's all on file, anyway. I don't know the 

19 exact figure. I wouldn't — it's very substantial. 

20 That was not the only loan. When I cane 

21 back, I subsequently was advancing funds to Triad 

22 Energy, also. 

23 Q. Now, there have been stories — and which 

24 have appeared in the press, and I'm sure you're 

25 familiar with them — indicating that at one point 



IWIMtHED 



728 





ALFRED C. DBVENPORT, Of fTciaX Txaminer , Toronto 

(TONFlD^iWIALr D. FRASER ^^ 

1 forty-thraa million dollars in loans, in advances, 

2 apparently secured by notes, were passed from 

3 companies, which you control, to Triad U.S. 

4 A. Hell, I didn't think it said what I control. 

5 Q. Well, then Vertex — well, I'm sorry, that's 
C true. Euro Coaaercial Finances and Vertex Finances, 

7 you're correct. You don't control Vertex Finances. 

8 But through those two companies, to the best of your 

9 knowledge, is that a true statement? 

10 A. The figure I don't remember, but I know that 

11 there was mortgages placed on some of the Triad 

12 properties, which would all be of record in Salt Lake, 

13 from Vertex. I don't know the exact figures. 

14 MK. GAMBLE: From Triad? 

15 THE WITNESS: Yes, from Triad and its 

16 various subsidiaries. But they would be all 

17 registered. 

18 MR. GAMBLE: Yes. 

19 BY MK. LISKBR : 

20 Q. Mr. Gamble indicated that you are a resident 

21 of the Cayman Islands — of Grand Cayman. What other 

22 residencies do you have? 

23 A. I'm also • resident of Monaco. 

24 Q. And your citizenship is exclusively 

25 Canadian? 



inMiRiED 



729 



ALFRED C. DEVE 




19 



1 A. Right. 

2 Q. Hav* you had frequent meetings with Mr. 

3 Khashoggi? 

4 A. Yea. 

9 Q. Row many tiaaa have you set with him aince 

6 you firat bagao buainaaa with him in March o£ 19867 

7 A. Haatinga or talephona calls and that? At 

8 one point, I would apeak to him on a daily baaia. 

9 Q. Did you speak to others, senior advisors of ' 

10 Mr. Khaahoggi's? Did you speak, for example, 

11 frequently with Mr. Purmarfk or 

13 A. Z was telling Mr. Gamble, Mr. Furmar«k I met 

13 for the first time three weeks ago, when I resigned. 

14 He waa in Mr. Khaahoggi's apartment in Paris. And that 

15 was th« first time that Z have ever met the man. 

16 Q. Had you heard hia name before? 

17 A. Sure, in tha press. 

IB Q. Hell, I mean apart from today. In the 

19 context of these stories or 

20 A. No. Other than the press, and I read the 
31 Tower report, and that sort of thing. 

33 Q. Again, according to press accounta, the 

33 Indebtedness to which Z referred earlier, waa 

34 secured — waa obtained in three inatalments. 
25 According to the press: Eight million with a 



mmiB 



730 



.JiilffiSMEO 



ALFRED C. DEVElll^mfV<MlldBVvH4ul#' Toronto 

(CVJlll IDUIIUAL) D. PRASER ^° 

promiasory not* on 11-15-85; s«v«n million with a 
promissory not* thr** days th*r*a£tar, which would be 
11-18, and six million with a promissory not* 1-5-86. 
To th* b*at of your knowladg*, is that tru*? 

A. X r*a*mb*r documentation in March relating 
to that, y*s. 

Q. So it is tru*7 

A. As far as — it's on public raeord. Again, 
on Triad's racords. 

10 g. Y*s. Again, th* saa* story said that th*r* 

11 was a daad of truat, March 20th, 1986, for car tain Utah 

12 r*al aatata? 

13 A. Right. 

14 Q. To your knowledge, and without violating the 

15 aecrecy lawa of Cayman Islands, was all of the money 

16 that passed through the two companies accounted for in 

17 one form or another? In other words, assuming the 

18 twenty-one million dollars came from those companies 

19 that flowed into Triad, are you satisfied, in your 

20 mind, that the money — that you know what happened to 

21 that money? 

22 A. X n*v*r saw th* funds in or out. Lik* I 

23 wasn't involvad with th* funds at all, so 

24 g. So you hav* no knowledge of what 

25 transpired 



utmiffiWD 



731 



RKnoWSwWflWfilrr ^0 



ALFRBD C . DBVBNPOM 

(rnMFTnBMTTiT.i D. FRASER ^^ 

1 A. I h«v« no knowledge of that at all. 

3 Q. Is Mr. Miller also a director of Triad? 

3 A. He was at the first, froa March to May, but 

4 that's the only tiae he was on as a director. 

5 Q. Has he also solicited by Mr. Khashoggi to 

6 assune those responsibilities, or did you? Here you 

7 interested 

8 A. You'd have to speak to Mr. Millar on that. 

9 I don ' t know . 

10 g. You didn't ask hia to do it? 

11 A. No. 

12 Q. Zn your business dealings, in your normal 

13 business dealings, have you ever been involved, to your 

14 knowledge, in any business activities relating to the 

15 purchase or transfer of eras? 

16 A. None whatsoever. 

17 Q. And whan I say aras, Z aean not only weapons 

18 and iapleaents of war, but materials which could be 

19 applied in way of supporting those items? 

20 A. Z'a not — you have to understand one thing. 

21 Z'a involved in the finance business. Z'a involved 

22 in — Z trade on the stock aarket. Z'a an investor. X 

23 have some saall companies hare in Canada. One, a 

24 manufacturing of steel buildings, and that is it. Like 

25 Z'a not involved in any trading or arms dealings or 



mimm 



732 



ALFRED C. OEVENPOR 



mmm. 



0. FRASER 

1 anything Ilk* that. 

2 Q, Wall, apart from your participation in 

3 Vartax Financas, and your axclusiva ownarship of Euro 

4 Coanarcial Financaa, B.V, what othar companlas do you 

5 participata in? !'■ not apaaking of sharaa hald, you 

6 know, in tha stock markat, as an ordinary invastor, but 

7 Z aaan, do you hava official positions in any othar 

8 coapanlas? 

9 A. Quits a faw, but that's my prlvat* thing. 

10 MK. OAMBLI: Yas, it is. 

11 BY MK. LISKIR ; 

13 Q. Not ralatad in any way to Mr. Khashoggi 

13 A. No, not ralatad. 

14 Q. — or any of tha othar individuals who hava 

15 baan idantifiad? 

16 A. You hava to undarstand on* thing with Mr. 

17 Khashoggi. Z sat hia in March. Z'va racaivad a lot of 

18 publicity about it. I finally hava baan abla to resign 

19 and go back to tha way Z was living with a low profile. 

20 And Z hava vary, vary littla relationship 

21 with Mr. Khashoggi, othar than right now through 

22 Skyhlgh. And he's Chairaan of tha board, and Z'm a 

23 director, and that's it. 

24 Z will still give — if h* needs my help, to 

25 give hia consulting on Triad. Z have agreed that Z 



22 



mswD 



733 



mmm 



ALPRKD C. DBVBNPC 

1 would. Bacauae I 'a — thay'v* taken a lot of my advice 

2 on cutting bacic where they ahould and eliminating some 

3 o£ the companies and that, but other than that, that's 

4 the total extent of ay buaineas with Mr. Khashoggi. 

5 Q. Do you know Mr. Hilliaa Caaey, former CIA 

6 Director. 

7 A. No, Z don't. 

8 Q. Mr. Charles Allan, former National 

9 Intelligence Officer for the CIA? 

10 A. No, I don't. 

11 g. Do you know Mr. Hanuchehr Ghorbanifar? 

12 A. No, Z don't. 

13 Q. Mr. George Cave? 

14 A. No. 

15 Q. Okay. D- you kaow Mr. Cyrus Haahimi 

16 (phonat.), or did you know Mr. Cyrus Hashiai? 

17 A. No. Some of these names you're say- 

18 ing — okay, I've met a lot of people at Mr. 

19 Khasboggi's apartments, and things like that, okay, 

20 and — but I do not know any of thoae people by name, 

21 other than I've read some of the people's 

22 g. Right. 

23 A. — names from 

24 MR. GAMBLB: You may know who they are, in 

25 other words? 



itOtMBiriED 



734 



mmm. 



ALFRED C. OBVi||*lVlAflUvtp3||a4rr, Toronto 

(Ca i lPtB BlUM L) D. PHASER ^* 





THE WITNESS: Y«s. 


BY. 


MR. LISKER: 


g- 


But you don't know th«a personally? 


A. 


No. 


Q- 


General John K. Sln0laub? 


A. 


No. 


Q- 


Hlebaal Ladaan? 


A. 


No. 


Q. 


Baanual Higganabarg (phonat.)? 


A. 


No. 


0- 


Mr. Niarodi. Mr. Nir? 


A. 


No. 


Q. 


Do you know Mr. Klacha? 


A. 


No. 


Q. 


You hava navar aat any of thoaa paopla. to 


your knowl«d0«7 


A. 


Not to ay knowladga. 


0. 


Hava you had any diacuaaiona with Mr. 



Khasboggi, sinca thia atory broka, concarning Mr. 
Puraa«k'a coaaanta and how thia thing evolved? 

A. Well, I 'a aura Z hava. Like I waa very 
upaet when it firat broke. But Z can't apecifically 
reaeaber exactly what Z diacuaaad about it, you know, 
but Z'a aura Z've coaaented about thia to hia. 

Q. Well now, you know there were two stories 

llAini inni 




IQI 



735 




ED 



ALrRBD C. DBVENPORT, Official Examiner, Toronto 
(Ca< t P iB H IWI* b4 0. FRASSR 

initially. Hr. Furaarflk's version of the two angrr 
Canadians, and then Mr. Khashoggi's subsequent press 
interview in which he said that that was a ruse, in 
order to put pressure on the CIA to come up with ten 
million dollars to satisfy an unnamed partner. 

Do you have — apart from what you have read 
in the press, do you hsv* any information about those 
two events? 

A. I have nothing. Z tried to stick mainlr to 
Triad. And when Z went to the press trying to explain 
it, I got d«ep«r and deep«r into a bigger mess, 
so — like Z just stayed away from the whole thing. 

Q. How many discussions with Mr. Khashoggi have 
you had since the story broke, approximately? How many 
discussions? 

A. Z have been talking — like up to a point, I 
said Z talked on a daily basis to him, when it was — I 
had a lot of 

Q. But how many of those discussions related to 
the press accounts and what was happening to you, as 
opposed to business of Triad and 

A. Z'a not sure. 

Q. — Blue Sky? 

A. Z would — Z've just mentioned — Skyhigh. 

0. Skyhigh. I'm sorry. 



25 



mussm 



736 



JiMinssie 



ALFRED C. OEVg)V<Atf VSftliflif BcSwii- . Toronto 

- 26 

(rniljilBnilfllTlI ) D. PRASBR 

1 A. It would just b* in comncnts that, you know, 

a lilc* I wish — I'd say something: Like I wish this 

3 would straighten Itself up and 

4 Q. And what would he say? 

5 A. He would assure ne that it's fine, so 

6 Q. Did he ever give any explanation to you as 

7 to why Mr. Furmartk aade the stateaents that he did? 

8 A. No. 

9 Q. Did you ever seek an explanation? 

LO A. No, I never. It wasn't — like I thought 

LI that — I don't think Mr. Puraarfk ever said ay nana. 

L2 It never caae up, but it was — like I never realized 

L3 that he had actually said ay naae with thea. 
L4 Q. Hell, the naaes initially were, as I 

L5 understand it, were garbled a little bit, but I 

L6 believe he had your last naae, or a last naae which 

L7 Mr. Khashoggi said was a ruse. 

L8 A. Oh, I never knew. Z really didn't know that 

L9 until now. Like I think, originally, when it caae out 

20 that there were two Canadians, Z thought that it was 

tl two other chaps that were involved with Barrick 

(2 Resources. 
13 g. Z'a sorry. Who are those two persons? 

24 A. What's the guy's naae now? My aind has gone 

25 blank, I think. 



UMEinflNED 



737 



u 




ALFRED C. DEVENPORf, Of f icTal fiflBimier . Toronto 

27 
' CAtUUAfiWEJAU 0. FRASER 

1 MR. GAMBL8: M«ll, that's all right. I 

2 know on* of than, but I don't know whether that's 

3 a — I mean, this was just speculation on his 

4 part. 

5 MR. LISKSR: Hall, Z'a curious as to why he 

6 would have thought it was thass two fallows. 

7 THI HZTNBSS: It's just that th*7 were 

8 dealing a lot closer with Mr. Khasboggi over the 

9 last nujDb«r of years through Barrick, so — olcay? 

10 BY MR. LISKBR ; 

11 Q. Hell, could we have their names? I don't 

12 expect you to recall thea now. 

13 MR. GAMBLE: I know what they are, but 

14 MR. LISKBR: Hell, if it's not Mr. Fraser 

15 and it's — you know, the other gentlemen 

16 THB HITMBSS: Hell, I don't — they are 

17 not involved. I don't think that they were 

18 involved at all, but 

19 BY MR. LISKBR ; 

20 Q. How would you know that? 

21 A. Just froa the understanding that no one was 

22 really involved. 

23 Q. But you see the problem that we've been 

24 having with Mr. Khashoggi, and his various explanations 

25 of events, is that there seems to be something lacking 



U 





738 



JRiaHIIIED 



ALPRBD C. DEVENPWt,V«nUH%ftUl|m||«i/ Toronto 

28 
(rnMfTPHIlfllTIL) D. PRASBR 

1 in consistancy; and depending bow the spirit moves hia 

2 at a particular Boment, he offers a new explanation. 

3 And while I'm not suggesting in any way, shape or form 

4 that these men are actually involved, X would 

5 appreciate it, if it would be possible, to have the 

6 names, recognizing that this is not going to be a 

7 public transcript; that this transcript will b« under 

8 our rules and tinder the Rouse rules, and will not be 

9 released. 

10 MR. GAMBLB: Hell, how about the rules of 
H the Select — the 

12 MR. LZSKBR: Independent Counsel. 

13 MS. BBEN: Well, it's the position of the 

14 Office of Independent Counsel that this not being 

15 transcribed at our request. Why? 

16 MR. GAMBLB: What's going to happen to this 

17 at this point? 

18 MS. BB8N: We are absolutely bound by 

19 Grand Jury secrecy. We do not release our 

30 materials to anyone, as has been reported in the 

21 press, and as you alluded to earlier. We have no 

22 intention of releasing any of this information. 

23 MR. GAMBLB: I just hate to implicate 

24 people that we now believe never in fact were ever 

25 involved 




739 



jmSHEIL 



ALFRED C. DB^Vl>lVL.t1W«M] abifter , Toronto 

MR. LISKXR: With respect, Mr. Gamble, you 
haven't conducted an Investigation. 

MR. GAMBLE: No, I know that. I know that. 
But Z suppose it Bay be aaterial in answering your 
question. When the Canadians were — the two 
Canadians were spoken of 

THB HITNBSS: X think it was in press there 
anyways, John. Z reaeaber the naaa, that one is 
Peter Monck (phonet.). Z sight as well say it. 
Peter Monck 

MR. GAMBLE: Yes. 

THB MITNBSS: — and what's the other guy's 
name? 

MR. GAMBLB: Gilmore. 

THB HITNBSS: Gilmore. Zt was in the 
Canadian press. 
BY MR. LZSRBR: 
Q. Mr. Gilmore 's first name, sir? 

MR. GAMBLB: Z can't remember Gilmore 's 
first name, but 

MR. LISKER: Z appreciate your cooperation. 
Z understand your concern, but Z assure you 
that 

MR. GAMBLB: Zt's that we wish not to put 
you on to 



wmms 



740 



wmm 



AL?RBD C. DBVENPORT, Official Examiner, Toronto 

. 30 

(0«lllii.UUllii.llL"7 D. FRASER 

1 HK. LISXSR: Y«8, y«8 . I completely 

2 understand, but you have to also appreciate that 

3 we are attempting to develop as aucb as 

4 information about Mr. Khashoggl as possible, for 

5 purposes of these various investigations. To that 

6 extent those individuals, who have dealings with 

7 Khasboggi, are of interest to us — at least, in 

8 passing, and perhaps nothing sore than that. 

9 THB WITNESS: Hell, they ware involved in a 

10 public company with them also, and that was the 

11 only thing. And X think the press started off 

12 with them, and then their stock plunged and 

13 then 

14 MR. GAMBLE: Yes. 

15 THB WITNESS; — they made statements, and 

16 then our names came up, Mr. Miller's and my name, 

17 so 

18 BY MK. LISKER : 

19 Q. And the public company that they were 

20 involved with? 

21 MR. GAMBLE: American Barrick. 

22 THE WTTNESS: American Barrick. 

23 MR. GAMBLE: American Barrick Resources, I 

24 think. 

25 Q. ,. Is it B-B-R-B-C-K? 



mmm 



741 




ALF»ED C. DEVENPdir, TjftT<?niV E!kWlin«r, Toronto 
{C^ailDSiaiJiJU 0. FRAS8R 



ii. 



I 

2 

3 

4 

5 

6 

7 

S 

9 

10 

11 

12 

13 

14 

15 

1< 

17 

18 

19 

20 

21 

22 

33 

.24 

35 



A. B-A-R-R-I-C-K. 

MR. GAMBLE: Yes. 
BY MR. LZSKBR: . 

Q. Ar« you Caailiar with th« company called 
Sbaheen Natural Rasourcaa? 

A. No. !'■ faaillar with a Sbahaan, 

Q. Hhich Shahaan? 

A. — a naaa Shahaan, Bob Shahaan. 

Q. Bob Shahaan. Do you know Mr. Richard 



Sacord? 
A. 
Q- 
A. 



No, I don't. 



Ci. 



-^e^ 



Mr. Thoaas Q"-"" (phonat.) with an S? 

No. 

Mr. Albert Hakin? 
A. No, I don't. 

Q. You never met hia or 

A. No. 

Q. — spoken to hia, to your knowledge? 

A. No. 

Q. Now, John Shaheen? 

A. No. Like who — is that a relation to -- I 

nay have aet a Shaheen 

g. No, no relation. There are two Shaheens, 



John and Robert. 



mmm 



ito Robert? 



742 



JffilMO 



ALFRED C. DBVBNWIl.WJWiWftVHaIn!?, Toronto 

(crutrmeiiniotii d. frasbr ^ 

1 Q. Thcy'r* noc related, no. 

2 A. No. Ob. 

3 Q. Mr. Scblomoko Zeit (phonet.)? 

4 A. No. 

5 g. Mr. Raphael Biten? 

6 A. No. 

7 Q. Mr. Fraser, do you travel abroad frequently? 

8 A. Yea, I do. 

9 Q. Oo you travel to your Buropa? 

10 A. Yea, Z do. 

11 Q. Do you travel to Switzerland? 

12 A. Yea. 

13 Q. Which citiea in Switzerland do you travel 

14 to? 

15 A. I have traveled to quite a few: Zurich 

16 Geneva. 

17 g. Did you travel to thoae citiea during 1985 

18 and 1986? 

19 A. I know I did in '86. '85, I'm sure I did, 

20 probably. 

21 g. And what would the purpose of your traveling 

22 be? 

23 A. Usually business. 

24 g. Do your companies maintain accounts in 

25 Switzerland, banking accounts? 



inmpoi 



743 



IMiilEP 



ALFRED C. DEVBNfClr,''8fncT«rix««rner, Toronto 
(I WHl i XUiHilAlJ^ D. PRASER 

MR. GAMBLE : Whan you're reCerring to his 
companies, you're referring to companies that he 
himsalf controls, and owned entirely by Mr. 
Frasar? 

MR. LISKBJt: Yes. 
MR. GAMBLE: Okay. 

THB WITNBSS: Hell, that's all right. As 
long as thay don't get frozen. 

Yes, X do. My companies do. 
BY MK. LISRBR ; 

Q. And do you maintain accounts at the Credit 
Suisse Bank? 

A . No , I don ' t . 

Q. When Mr. Rhashoggi is unavailable, who on 
his staff would you normally converse with, if it was 
important to spealc to someone who could speak to Mr. 
Rhashoggi or who could communicate with him directly? 

A. If I have trouble getting ahold of him, I 
guess Bob Shaheen. I try to get him. 

Q. Have you traveled with Mr. Rhashoggi 
extensively? 

A. Not that much, no. 
Q. Have you on been on the Nabila? 
A. No, I haven't. 
25 Q. You fUSt_h|L AbtffSSlfmferson who hasn't been 




33 



744 



.MiJK 



ALFRED C. DEVENTOfcT, OtficiaT Examiner, Toronto 

(CiillirtBilWH^lJt D. FRASER ^* 

1 on it, flxcapt Cor present company? 

2 A. I have only been on his plane with him once, 

3 ever. I have been promised to go on the Nabila. 

4 Q. And your travels with Mr. Khashoggi were 

5 when and to where? 

6 A. I had one trip from New York to Denver. And 

7 I can't remember the date. 

8 Q. It was '85 or '86? 

9 A. '86. I think it's November, somewhere 

10 around there. 

11 Q. I'm sorry. '86. 

12 A. It was probably November or December, 

13 October — somewhere like that. 

14 Q. You indicated that — I believe you 

15 indicated that you met him initially in 1981; was it? 

16 A. '80, '81. Just shaking hands in the casino. 

17 I was friends with the casino managers. And he 

18 happened to be there, and he was coming through and he 

19 was talking to one oC them, and I shook hands with him. 

20 Q. And did they introduce you to him, or did 

21 you in-roduce yourself or what? 

22 A. They introduced me, but it was like ten 

23 seconds — sort of. 

24 Q. All right. When you began your busir.-ss 

25 relationship Mtlx J4ijn,.hAW^i^th2t^come about? 




745 



4lH9lilED 



ALFRED C. DEVBN^||f,|||!4^^||f!|finU, Toronto 
(i,i.lllHl.ili|i|| [AH D. FRASBR 

1 A. I was introducad to him through Mr. Ernie 

2 Hill«r. 

3 Q. And what was Millar's relationship with him? 

4 A. I think they're friends. 

5 Q. Are they business associates as well? 

6 A. Z — you got ae there. 

7 g. And at the tiae of Mr. Miller's 

8 introduction, what representations were aade? Has it 

9 just an inforaal introduction, or was it an 

10 Introduction with a view towards establishing a 

11 business relationship? 

13 A. No. He both went on as directors at that 

13 time on Triad. And I guess it was mainly we were going 

14 on as directors to advance additional funds to support 

15 Triad, until they determined, you know, what was going 

16 to happen to the company. 

17 Q. Hhy do you suppose Mr. Khashoggi came to 

1 8 you? 

19 A. Hell, through Mr. Miller. 

20 Q. Z mean why? Z mean, it seems to me that, 

21 you know, given only this one big chance meeting, in a 

22 casino, in 1980, 1981 — - 

23 A. Oh, it was from Mr. Miller. Mr. Miller I've 

24 known twenty years. 

25 Q. And had Mr. Khash-jaatfiMM viously approached 






746 




ALFRED C. DEVENPOR'T, DttT(fI^l'S*lfflliner, Toronto 

(^ewmJBITTXn d. fraser 

1 Mr. Miller about securing some additional financing? 

2 A. I don't know. Oh, yes. sure, he did. 

3 Q. Did Mr. Miller explain this to you at the 

4 time? 

5 A. Yea. That was tha purpose of the neeting 

6 with Mr. Khashoggi and Mr. Miller and nyself. 

7 But the main thing was to try to save Triad. 

8 He had very, very bad Banageaent there. And like I 

9 said, Z cut something like three or four million 

10 dollars of the overhead the first couple weeks I was 

11 there, and then things were just going downhill very, 

12 very badly. 

13 Q. At the time you came on, as a result of this 

14 meeting which Mr. Miller set up between yourself and 

15 Mr. Khashoggi, did you have any understanding of 

16 Triad's difficulties? 

17 A. Partly, but they were understated. They 

18 were substantially understated. And it was only until 

19 the end of April, early May, that Z realized how bad 

20 they were, the situation was. 

21 Q. Hell, so you were coming on, not only to 

22 supply additional financing, but also to bring 

23 management skills and some organization 

24 A. Right. 

25 Q. — to a faltering company; is that correct? 



mmmui 



747 



.UROilSHtED 



ALFRED C. DEVENF 

"TlHlTTr"""''" ' D. FRASBR 

1 A. That" ■ right. 

2 Q. And yat your only contact, apart from that 

3 chanc* meeting in 1981, wai through Mr. Miller? 

4 A. Right. It was through Mr. Miller's 

5 recoaaendation that Z was brought on as president. 

6 Like he has known ae, like Z said, twenty years. 

7 Q. Do you still have a good relationship with 

8 Mr. Miller? 

9 A. Off and on. 

10 Q. What do you know about Mr. Khashoggi's other 

11 business activities? 

12 A. Z don't really know anything about his 

13 business activities. 

14 Q. From your position as president of Triad, 

15 U.S. — Z assume that that's correct? 

16 A. Right. 

17 Q. Here you briefed or kept abreast of Triad's 

18 daily situation? You know, their 

19 A. The Triad Anerica situation? 

20 Q. Yes, Triad Aaerica? 

21 A. Oh, yes. Z tried to keep on top. 

22 Q. Did Triad America — Z think it's pretty 

23 clear, from what you said earlier, that Triad America 

24 had some interlocking relationship with a whole host of 

25 other companies? 



VMtUltgSKIED 



748 



.sHiisinED 



ALFRED C. DEVEN{^|TmHnBM.leMnAll«Pf Toronto 
U a iU i llU&lHIMlJ l D. FRASER 

1 A. Well, it has aubsidiaries throughout the 

2 United States, yes. It has, well, subsidiaries in 

3 Florida and California and Utah and Texas. So it's 

4 « — it was a substantial — still is a substantial 

5 holding coapany. 

6 Q. Do«s Triad, U.S. or the international 

7 eoapany, to your knowledg*, have any connection with 

8 Lonrho, the London-Rhodesia coapany, Lonrho? 

9 A. Not that X know o£. 

o 
LO Q. Headed by Mr. Tiny Rolands, who is 

LI the — Rolands is the CBO? 

L2 A. No, I don't. 

L3 Q. Are you aware of any loans or credit 

L4 extended in 1986 by Mr. Rolands to Mr. Khashoggi? 

L5 A. No. I don't. Other than what I read in the 

L6 press. 

L7 Q. Do you know the Bl Flad (phonet.) brothers, 

L8 in London? 

L9 A. No, Z don't. 

to MR. LZSRSR: Mell, why don't Z break and 

il allow — give ay colleague an opportunity here. 

t2 And Z would like to reserve the opportunity to 

i3 coae back afterwards. 

24 MS. NAUGHTON: Okay. 



38 



25 



UffliKMFIED 



749 



mmmB. 



ALFRED C. OEVENMWfT>^nin»lHVIU*Ur, Toronto 

( g ei lPIDDIHI ftW 0. FRASER ^ 

EXAMINATION BY MS. NAUGHTON : 

Q. If w« can go back, pl«ase, Mr. Fraser, to 
thes* loan altuationa. Did I understand you to say 
that Euro CoBnarclal Flnancas loaned nin* million 
dollars? 

A. No. I comaittad to loan nina Billion. I 
•Ddad up landing: Z think it was on* aillion, savan 
hundrad and sixty thousand. 

Q. Okay. Whan you coaaittad to loan tha nina 
aillion, for what purpose was that? 

A. What purpose? 

Q. Yes? 

A. It was to fund the payrolls and bring some 
of the mortgages up to date and that, but the idea was 
that Z was able to take — Z was supposed to be able to 
take a look at the situation. And the money would be 
spent the way Z thought that it should be spent. 

Q. All right. So this money was to be used for 
the management of Triad? 

A. Right. 

g. Zs that right? Has that in the committal? 
Has that specified in the committal? 

A. No, but part of the commitment was that I 
was the president of Triad, and Z was — I had held the 
purse strings, and I was going to advance the funds as 



tnd I was going to advanc 



750 



.INiiSIIEII 



ALFRED C. DEVENPnnr^nnniVMtilxyM Toronto 

'j^nHF^nrMTT^^ o. fraser *° 

1 it was needed. 

2 Q. So part o£ the deal was that you would 

3 becone president? 

4 A. Right. 

5 Q. And the deal was consuaaated in March of 

6 '867 

7 A. Right. 

8 Q. And Euro Coaaerciel actually loaned one 

9 point — what is it that you 

10 A. One ■illlon, seven hundred and sixty 

11 thousand. I think that's the right figure. That's the 

12 figure. 

13 Q. Okay. Was that in form of cash? 

14 A. It was wire transfers. There was one for a 

15 million dollars, and then I wired funds to my lawyers, 

16 and they advanced the funds. 

17 g. Has that from the Bank of Montreal? 

18 A. I don't know where they would have advanced 

19 it through. It would be coming from the Cayman 

20 Islands. So I don't know where they would have 

21 advanced it through Montreal. 

22 Q. Do you bank at the Royal Bank of Montreal at 

23 all? 

24 MR. GAMBLE: Hell, those are different 

25 banks. There's the Royal Bank and the Bank of 



iffiSMED 



751 




41 



1 Montreal, two separate banks? 

2 THE WITNESS: No, I don't bank with either 

3 on* of thea. 

4 BY MS. NAUGHTOW ; 

5 Q' You don't bank with either on* of then? 

6 A. Now, if it's being transferred, okay, the 

7 banks in Cayaan aay be using on* of tbos* banks to 

8 transfer it through. That's th* only thing. 

9 Q. What happ*n*d to th* r*st of th* comaita*nt 

10 on th* nin* Billion? Has that canc*l*d at som* point? 

11 A. Y*s. 

13 Q. Wh*n was that? 

13 A. Whan I l*ft. 

14 Q. Wh*n you resigned this last time? 

15 A. No, the time before. 

16 Q. The time before. 

17 A. Yes. 

18 Q. So that was 

19 A. In May. 

30 Q. — around May? 

21 A. May. 

22 Q. What made you resign in May? 

23 A. The Board was at a deadlock, and I had to 

24 use my veto power for every motion, and it became very 

25 uncomfortable in dealing with the^Board the way it 



MMSiEIED 



752 



.IMSMD 



ALFRED C. OBVENWRYVifnfSrJBrCinhbiM-, Toronto 

^ 42 

(c9wrTBwrmi** d. fraser 

1 stood. 

2 Q- And what mad« you come back? 

3 A. Tha othar half of tha Board was to resign 

4 and Mr. Manny Floor was to go off tha Board, and it was 

5 basically that Z could than start working without 

6 having my suggestions changed every two ainutes. 

7 Q. And was that also — was part of the deal 

8 also another conaitaent for funds? 

9 A. Yes. 

10 Q. And how auch was that coaaitment for? 

11 A. It was supposed to be around five million 

12 dollars. 

13 Q. Again, what were these proceeds to 

14 be — this money to be used for? 

15 A. They were used on a — again, daily basis, 

16 to pay mortgages, salaries — everything. It was 

17 always advanced in saall amounts. 

18 Q. Okay. So operating expenses? 

19 A. Yes. 

20 Q. And how much of this coaaitment was actually 

21 paid? 

22 A. I'm trying to think of the figures. I 

23 advanced about 3.2, I think. 

24 Q. Million? 

25 A. Right. I'd have to op to the figures and 



Right. I'd have to op 

mmi0 



753 



ALFRED C. DBVBNP 



wmmm 



PRASER 



43 



1 se«, b«c«us« thcr* ware some othar small loana that 

3 waran't involvad with tha comaitmant that but it 

3 would all ba racordad in Salt Laka. I 'a not sure of 

4 tha exact figuraa. 

5 Q. Okay. Whan you aay — wall, first of all, 

6 would thasa ba in tha ainutas of tha Board aaatings? 

7 In othar worda, would this raquira Board approval, or 

8 70U just did it on your own? 

9 A. Which? 

10 Q. Tha 

11 A. The funds advanced? 

12 Q. Yes. 

13 k. They would be advanced at tha last minute, 

14 when I had to Bake the payroll or something like that, 

15 for something like that. 

16 Q. And do you recall approximately how many 

17 advances there were? You said they were small loans. 

18 A. Twenty. Twenty advances, approximately. 

19 Q. And this is over the period of what time? 

20 A. Prom September up until — I guess when the 

21 company went into bankruptcy in January. 

22 Q. And what made you resign this last time? 

23 A. You're reading some of the press there right 

24 now. I want to gat back to doing my own living. 

25 Q. Did you ever aat^^d back any of the money? 



ifliii 




754 



mmm 



ALFRED C. rr"nn~Trr'^~rn^nrr TlWV ififc ^ Toronto 
(' i i llilllBlUlAL ) 0. PRAS8R 

1 A. Not y«t, no. I'm wall aecured, but it will 

2 b* the bankruptcy courta that will dacida it. 

3 g. Was any of that comaitaant backad £roa 

4 collataral of stock in Aaarican Barrick? 

5 A. No, it wasn't. 

6 Q. Do you know of any loan, aitbar in which you 

7 participatad, or any loan at all, to your knowladga, in 

8 which Aaarican Barrick was put up as collataral? 

9 A. X think through tha — X'a trying to 

10 think. Tbars was a coaaitaant that was signed by Triad 

11 Amarica, but I don't think that loan want through. But 

12 thara was soma Aaarican Barrick that was supposed to be 

13 put up as collataral. But, again, tha documentation 

14 would be in Salt Lake. But I think because that loan 

15 didn't go through, the collataral was — like the 

16 guarantee was not taken down. 

17 And then there was another loan, I think, 

18 that — I'd have to take a look at the Salt Lake 

19 records and see exactly what loans there were. But I 

20 think there was a loan that waa supposed to be for 

21 Barrick, but I don't know if there ever was a final 

22 inatruaent. 

23 Q. Has there ever any one consumaated in which 

24 stock from American Barrick was taken aa collateral? 

25 A. Nol 




ED' 



755 









ALFRED C. DEV«NPORT»,''©fCf««'^BS«aifier, Toronto 
(CO ft y iUUHIIHto ) 0. FRASER 



45 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



coapany — another conpany called Barrick, which owned 
Barrick, okay, but not Aaerican Barrick itself. But I 
don't have the Cull details with me. 

Q. What was that conpany's name? 

K. 1 think it's just Barrick Investments, and 
then there is company called Horsham (phonet.), Horsham 
Investments. That's with those — the other two 
Canadian chaps that 

Q. In, let's say, September of 1986, do you 
know what the value of American Barrick Resources stock 
was? 

A. From about a quarter of what it is now. 
It's worth about eighty million dollars now. It was 
probably worth twenty then. It's gold stock, which has 
jumped dramatically. Twenty, thirty million. 

Q. And when did it take the dive? 

A. When did it — what do you mean, when did 

it 

It's not a dive. It was an 



MR. GAMBLE: 

increase 

THE WITNESS: 

MR. GAMBLE: 
BY MS. NAUGHTOM : 
Q. An increase? 
A. Well, it was worth twenty to thirty million 



An increase. 
— he's describing. 



UiflSSilED 



756 



ALFRED C. OEVBN 




46 



dollars 

Q. Th«n? 

A. — in S«pt«Bb«r. 

Q. Oh. 

A. And it's — it want down and than went right 
back up. Thaaa ara approxiaata figuraa. Z don't watch 
that atock. in othar word*. But it waa ovar 
forty — it waa ovar forty dollara Canadian laat waak, 
par ahara. 

Q. Okay. Now, Mr. Liakar aakad you aoaa 
quaationa ragarding largar loan figuraa. Tha reports I 
hava waa thirty-ona aillion loaned to Mr. Rhaahoggi. 
Now, waa that loan by Vertex? 

A. . Tha docuaant, yea. Hall, the documentation 
atatea that it waa owned — I 'a trying to think — like 
there were three notea or four notea, or whatever it 
waa, and like it waa all on file, again, through 
aortgages on the propertiea and ao on. 

Q. So 

A. I think there waa about a truckload of 
docuaenta relating to thoae loans in Salt Lake. 

Q. Here theae loans by Buro Coaaercial 

A. No. 

Q. — or by — by whoa? 

A. There waa nothing by Buro Coaaercial. It 




757 



Misra 



ALPRBD C. DEVENPUkTrMntJl^jy^nUe|f Toronto 
( ClMH f lUEWiXA L) D. PRASER 

1 was V«rt«x, okay, that was 

2 Q< By Vartax? 

3 K. Would this b« tha mortgagor or mortgagee? 

4 Mortgagor? 

5 MR. GAMBLE: Mortgage*. 

6 THE HZTNISS: Mortgagaa. Tha ona that 

7 lands, that's tha 

8 MR. GAMBLE: That's right? 

9 THE HITNBSS: — aortgagaa. 

10 BY MS. WAUGHTOM ; 

11 Q. Okay. By Vartax to Triad? 

12 A. I think thay war a loans to Mr. Rhashoggi, 

13 and than guarantaad by Triad. 

14 Q. Guarantaad by aortgagaa held by Triad? 

15 A. On Triad properties ; some ot the 

16 subsidiaries of Triad. 

17 g. Uh-huh. 

18 A. Again, there's a very — it's very involved 

19 docuaentation. 

20 Q. Now, was this the — this totaled the 

21 twenty-one aillion? Do you recall that 

22 A. There was three notes, yes. I think it was 

23 twenty-one aillion, yes, 

24 Q. Okay. 

25 A. — that the mortgages relate to. 



IMUQIUfilED 



758 



.iium). 



XLPRBD C. DBVENPorr'OTftWIT'ralmWW' Toronto 

^I'niirTriiiiiTHiin o. frassr ^^ 

1 Q. And do you know what period of tine this 

2 was? 

3 A. It was all docuaanted in March of last year. 

4 And at the saae tiae there was the ten million dollar 

5 loaa in March, which Z don't think we ever got 

6 advanced. 

7 Q. Okay. Explain that to ■•. There was a 
t coaaitaent for a ten-aillion dollar loan? 

9 A. Right. But that was supposed to be 

10 advanced, and Z don't think it ever got advanced. 

11 g. And what was the collateral for that? 

12 A. That was the one Z said that was some — the 

13 Horshaa stock and the — there was supposed to be some 

14 Triad stock, Z think, and soae Triad guarantees, but 
IS. that loan I don't think ever went through. 

16 g. Htay not? 

17 A. Pardon? 

18 g. Why not? 

19 A. Z don't know. 

20 g. Of the loans to Mr. Khashoggi, or to Triad, 

21 have we covered thea all now, of which you are aware? 

22 A. As far as Z know, of the funds that Z have 

23 advanced, yes. Like there's hearsay on them, but Z 

24 can't talk about hearsay — about other gleans. As far 

25 as Z know, yes. 



MiUSBIFe 



759 




ALFRED C. DEVBNPORT, Official Examiner, Toronto 

(C OMBU BB miMb ^ 0. FRASER *^ 

1 Q. All right. Did Mr. Millar evar tell you 

2 that ha had advanced Mr. Rhashoggi any money? 

3 A. I don't think he has personally. 

4 g. Any of his companies? 

5 A. It's possible, but 1 don't know the figures. 

6 You would have to talk to Mr. Miller. 

7 Q. Now, when Mr. Miller introduced you to Mr. 

8 Rhashoggi, did be tell you they had known each other a 

9 long time? And what was the iapression you got of 

10 their relationship? 

11 A. Z think they have known each other for 

12 awhile. I'm not sure exactly how long they've known 

13 each other. I have the impression that they're fairly 

14 good friends. 

15 Q. And what exactly did they say, either Mr. 

16 Rhashoggi or Mr. Miller, to get you involved in the 

17 March '86 transaction? 

18 A. Hell, they didn't have to say too much. 

19 Like I said, I was intrigued with the idea of being 

20 able to run Triad. And I thought that would lead to a 

21 lot of business connections, which I have met a lot of 

22 interesting people in business, but the connections 

23 aren't the way I want it to be. 

24 MR. GAMBLE: You, for instance. Counsel. 

25 BY MS. MAUGHTON; 



dlMttdlSfiiriED 



760 




ALFRED C. DEVBNPOOT, DfriTlIf TWIfciner, Toronto 
(C ai lP lBHI Wi JIC ) D. FRASBR 

Q. What was Mr. — Mr. Miller was put on the 
Board at the saae time 

A. Right. 

Q. Did he have any financial interest in this 
transaction? 

A. Hell, ha had — Triad had guaranteed the 
Vertex loans, a group of thea. And he's the Cbalraan 
of Vertex here in Canada, so 

Q. What was the interest rate on those loans? 

A. I 'a not sure about that. X think it was 
priae or priae, plus soaething. I think aine was 
priae, plus one or soaething. 

Q. Those loans the twenty-one aillion in the 
three notes, in March of '86, now, were those lunp sun 
advances? 

A. These were — like the docuaentation I got 
involved with were for advances aade prior to when I 
knew anything about the funds. So I don't know how 
they were advanced, whether it was a lump sua or 
partial advances. 

Q. Did Mr. Rhashoggi tell you about any other 
personal loans that he had received? 

A. No. 

Q. In any of your conversations? 

A. No. 



50 



IMSfFIED 



761 



mmm 



ALFRED C. DBVBNHWCT? T)FIl<!iTli"SamiTeT, Toronto 
(G9 H PiB WHl»ft ) D. FRASER 

1 Q- Ifby waa it that Khaahoggi needed money? 

2 A. I don't know. You'd have to ask him. 

3 Q. Hell, I maan, you helped arrange and get 

4 money. What was bis reason? Has it supposedly because 

5 he spends more 

6 A. Hell, Triad Aaarica was very, very short of 

7 funds . 

8 Q. Uh-huh. 

9 A. And I'm assuHsing that he's having a cash 

10 flow shortage, a problea also. 

11 Q. I sort of gathered, from your comnents , that 

12 you thought some of it was due to mismanagement. Is 

13 that true? 

14 A. That was the — how shall I — in America 

15 anyways . 

16 Q. All right. When you discovered this — and 

17 you said April or May you began to gat 

18 inklings — why didn't you just pull out then? 

19 A. Because I said that I'd — I had recommended 

20 that Chapter 11 was the only way at that time; that 

21 the — he wanted to save face; that he didn't feel that 

22 was the way to go, nor his brother. 

23 And nine million dollars was going to be 

24 duinped in there, and was going to disappear just as 

25 fast as if he put in ninety million dollar in there, 



51 



tNtllMBKIED 



762 



mmm 



ALFRED C. DEVMF^W^fWMf 'ETJWftfer , Toronto 

1 b«caus« it was ju»t — it was an andless hole. 

2 Q. Explain how that means that you shouldn't 

3 have walked away? 

4 A. I did walk away. I left, didn't I? 

5 Q. All right. So you recomnended Chapter 11? 

6 A. Last year. 

7 Q. —In May ot 

S A. May. 

9 Q. '86? 

10 A. Yes. 

11 g. And it was Mr. Khashoggl that opposed that? 

12 A. Hell, not so much. There were other 

13 directors. The other directors opposed it. 

14 Q. Who I assume are controlled by him; is that 

15 right? 

16 A. Mr. Khashoggi is — really didn't know that 

17 much about what was go.ing on in the U.S. operation. 

18 It's froa what I could understand. He was influenced 

19 tremendously by the other directors. 

20 g. There have been accounts in the paper 

21 regarding five million being provided to him by a 

22 Swami. or by a Saudi Arabian, in connection with the 

23 loans that they asserted that you had made to them for 

24 the arms deal. In other words, the assertion was, you 

25 put up ten million, and some Swami put up five. Are 



UMIiSSiED 



52 



763 








ALFRED C. DEVBUpORTT Of f icial BxamiTrir , Toronto 
(yai lPID H I IT Uim 0. FRASBR 

1 you aware of the identity of this individual? 

2 A. No, I aa not. 

3 Q. Okay. What is your relationship, if any, to 

4 the Sultan of the Brunei? 

5 A. Just what I read in the newspapers. That's 

6 all I know. 

7 Q. Have you ever heard of that person other 

8 than in the newspapers? 

9 A. Oh, in conversations with various people, 

10 but nothing — I've never done business with hia or 

11 talked about doing business with hia or anything. 

13 Q. All right. Have any of those conversations 

13 included Mr. Miller or Mr. Khashoggi or Mr. Furmartk? 

14 A. No. 

15 Q. Do you know whether or not Mr. Rhashoggi was 

16 doing business with the Sultan of Brunei? 

17 A. No, I don't. 

18 Q. Okay. Do you know of Transworld Arms? Have 

19 you ever heard of that? 

20 A. No, I haven't. 

21 g. Now, this first hit the public media, I 

22 suppose, maybe soaetiae in late November. Would that 

23 be fair to say? 

24 A. I think it was in aid-December when it hit. 

25 Q. Mid-December? 



mmim 



764 



mmm 



ALFRED C. DBVEMPORT, Of fTcm'BxfcfcMer , Toronto 

t'^rTTtlirTIfll 1 D. FRASBR ^^ 

1 A. y*a. 

2 g. All right. 

3 A. I r«a«ab«r It well. The atocks fall out of 

4 bad Ilka crazy. 

5 g. What did you do? 

6 A. What did X do? 

7 g. Yaa? 

8 A. Triad to ahora up tha atocka. Z waa in tha 

9 aiddla of a financinff for ona of tha public coapaniaa. 

10 Want and hald handa with Klddar Paabody thraa timaa, 

11 and triad to kaap it aliva, and than loat it. 

12 g. Okay. But did you call up Mr. Khashoggi? 

13 A. I'm aura Z talkad to hla aavaral times on 

14 that, bacauaa Z waa having a lot of problems with 

15 Triad. 

16 But Z think my main concern at that time was 

17 Z waa involved with a number of public companies. And 

18 Z started reaching the idea at that time that I'd have 

19 to start looking after my myaalf, and look after some 

20 of the thinga, or Z waa going to loaa an awful lot of 

21 the — my own inveatmanta. And Z waa going to lose a 

22 lot of my reputation, if Z kept juat going along with a 

23 lot of thinga. 

24 Z tried to go to the preaa at one point. I met 

25 with the RCMP aa aoon as Z heard they wanted to meet 



mWOHSSiED 



765 



^mmm 



ALFRED C. DEVENPoWWelfftTlr'EXrftiner, Toronto 
(C^KUABlffitM.) 0. FRASER 

1 with m*. 

2 And by going to the press, I think it 
baclcfired on me, because they took some o£ the 
statements I said, and made it as if I was saying other 
things in between, and then it came out — other things 
from it. 

Q. But as to Mr. Khashoggi, when this hit, 

didn't you call hia up and say: what's going on here? 

A. Well, I don't have 

10 Q. Why didn't you tell him? Why didn't you 

11 tell him: I don't 

12 A. I don't have that close a relationship. 

13 Like with Mr. Rhashoggi, I have a business 

14 relationship. It's not the kind of relationship that I 

15 could call up and talk about that sort of thing. 
'.6 Q. But this was ruining your business? 
1" A. Yes. 

18 Q. Then your statement is that you have never 

19 discussed it with hi n? 

20 A. No, no. I said I have talked to him, okay. 

21 But at that time I was of the impression trat it was 

22 just going to come out that Z was not involved, okay, 

23 that I was speaking to hia. 

24 And I don't think the press was playing 

25 it — it wanrtk im^kh% BC«A^^ACiJi|Aybe two or three 



55 





766 



IMilUMED 



ALFRED C. DEVENPORT. Official Examiner, Toronto 

(LUHIiUEJtiiALJ D. PRASER ^* 

1 weeks, that it was bad, okay. And when we tried to 

2 make statements, or I tried to make statements to the 

3 press, Maclean's magazine, or any of the other ones, it 

4 didn't really — wall then, especially the Salt Lake 

5 newspapers — it didn't corn* out that good. 

6 And it was through John and soae of the 

7 other people that said: just lay off, and don't say 

8 anything to the press and keep quiet. So there was no 

9 point of me making stateaents. 

10 Every time Mr. Khashoggi made a statement in 

11 the press, in any way, for any reason, and whether it 

12 was for Triad or anything, it affected the stock market 

13 tremendously. 

14 And I was trying to put some major financing 

15 together for a couple other companies. 

16 Q. Well, didn't you ask hia then to stop 

17 talking to the press, or in the alternative, to tell 

18 thea the truth? 

19 A. It's not my place to tell Mr. Khashoggi not 

20 to talk to the press. He has all kinds of experts to 

21 tell hia, but 

22 g. All right. Did you tell any of his people, 

23 that worked for hia, that you would appreciate it if he 

24 didn't make these statement? 

25 A. X had personal feelings that Z spoke to 



UNHiSSilD 



767 




ner, Toronto 
(C MH t iUlLJiiA L) D. FRASER 

certain paople, yes. 

Q. All right. 

A. But I don't think that I should — you know, 
that's my personal — but I never came out to Mr. 
Khashoggi , and said: Look, Mr. Khashoggi, you 

6 shouldn't speak to the press. It wasn't my place. 

7 Q. What about Mr. Purmar|k? 

8 A. I never — like I said, I've met Mr. 

9 PuraarSk for the first time about three weeks ago. 

10 Q. All right. Had you spoken to ttim prior to 

11 that time? 

12 A. No, I hadn't. 

13 Q. Had you had any anyone on your behalf speak 

14 to Mr. Furmarik? 

15 A. Never. 

16 Q. Now, you are aware that the details of these 

17 accusations come from Mr. Furmarik; correct? 

18 A. Uh-huh. 

19 Q. All right. 

20 A. That's what I understand from the press, 

21 yes. 

22 Q. When you met him at Mr. Rhashoggi ' s 

23 apartment, did you discuss this? 

24 A. I shook hands with him. I said to one of 

25 the gentlemen, that I "i* witJl^ Jltft "•■ ^^* first time 




768 



u 




ALFRED C. DBVBNPORT, Official Examiner, Toronto 

58 
//-J1fj»Tngmm.Ti.t V p FRASBR 

1 I've met him, and that's — that's it. I didn't even 

2 want to discuss it with him. I didn't want to be put 

3 in th« position that I'd have to discuss things with 

4 Mr. PurmarNPc. 

5 Q. Why not? 

6 A. Z may have lawsuits pending, and I have to 

7 look after what X have to do with tha prass and other 

8 people. 

9 Q. Mr. FuraarMk's statement, which is public 

10 record in the Tower Commission report, is that you had 

11 planned or were going to hold off suing him or Mr. 

12 Khashoggi for the money? Had you ever threatened Mr. 

13 Khashoggi or Mr. Furmarfk with filing a lawsuit to get 

14 your money back? 

15 A. No. Like I was continuing to advance funds 

16 when he supposedly said Z was going to sue. 

17 Q. So, in October of '86 

la A. I said that in the press. I told the press 

19 that, too, so it's 

20 Q. Z want to get the time frame down. Zn early 

21 October of 1986, you were still advancing money to 

22 A. Z advanced right up to January of '87. I 

23 slowed down considerably after December 15th, but just 

24 to keep a few things alive, until Z could talk him into 

25 Chapter 11, and finalize Chapter 11. 



UNNMSIHED 



769 




59 



1 Q. To the your knowledg*, had Mr. Miller 

2 threatened to sue cither Mr. IQiashoggi or Mr. Furmargk? 

3 A.I don ' t know . 

4 Q. But to your knowledge, he had not? 

5 A. He had not, no. 

6 Q. Is that soaethlng that you 

7 A. I could not see — Mr. Miller and Mr. 

8 Khashoggi were very close friends. I couldn't see 

9 thea — I couldn't see Mr. Miller suing Mr. Khashoggi. . 

10 Q. So when you saw — by the way, when you met 

11 Mr. Furmarflk for the first tiae, is that the only time 

12 that you have set bia, or have you met him since? 

13 A. No, that's the only time. 

14 Q. Have you spoken to him since? 

15 A. No, I haven't. 

16 Q. Did you and Mr. Puraarfk and/or Mr. 

17 Khashoggi discuss CIA Director Casey at all? 

18 A. No, I haven't done that. Like I said, I 

19 only said hello to him. I've never said — I don't 

20 think I said more than three or four words to him. 

21 Q. Why do you think they would do this? 

22 MR. 6AMBLI: I couldn't hear that question. 

23 BY MS. NAUCHTOW ; 

24 g. Vfby do you think they would do that? 

25 A. I have no idea. 



wmm 



770 





ALFRBD C. DEVENPCW, Otticial Examiner, Toronto 

'^r"''^"""'"''IIJ 0. FRASER ° 

1 Q. You certainly have some thoughts on it. 

2 A. Hell, just froB what — I guess maybe the 

3 last stateaent that Mr. Khashoggi aadc to the press was 

4 to put soB« pressure on collecting his funds . I have 

5 no idea. 

6 Q. But Z aean, Khashoggi has got other ways, 

7 don't 70U think, of getting ten aillion dollars, other 

8 than going to the Director of Central Intelligence? 

9 A. I don't know what the game plan is. 

10 Q. Mall, what was — you know the financial 

11 markets. What was his — what, in October of '86, was 

12 his financial power, in tens of obtaining a ten- 

13 million dollar loan from somewhere? 

14 A. Z don't know. I don't know his 

15 personal — Triad America could not get any funds at 

16 that time. Like I was having trouble financing on a 

17 day-to-day basis. 

18 And the only reason I was advancing is that 

19 I had the most solid collateral involved, and we were 

20 looking at taking that into a public company. 

21 Q. All right. And you're not aware of the 

22 financial status of his other enterprises? 

23 A. Not at all. 

24 Q. Did Mr. Khashoggi discuss with you, at any 

25 point, in your conversations, the status of the Middle 



uifflnsiiffio 



771 




ALFRED C. DEVENPORt, OfriciiTBRiliffttf , Toronto 

(•enfiUUNTULI d. frasbr *^ 

1 Bast? 

2 A . No . 

3 Q. Did h« discuss Iran with you? 

4 A. No. 

5 Q. Old h* discuss any plans of his to invest in 

6 Iran whan tha war was ovar? 

7 A. No. 

8 Q. Did Mr. Khasboggi avar discuss tha Israelis 

9 with you? 

10 A. Not at all. no. 

11 Q. What would you talk about whan you saw hia? 

12 A. How I was going to aaka tha payroll next 

13 weak, and who Z was going to fira, and whether I 

14 should — Z had something like eighty lawsuits going on 

15 in the coapany. Assets being seized. There was a lot 

16 to talk about. 

17 MR. GAMBLE: Would you like to read some of 

18 tha refinancing contracts in your leisure time? 

19 Fascinating reading. 

20 BY MS. NAUGHTON : 

21 Q. Old you have any of Mr. Khashoggi's bank 

22 accounts blocked for any reason? 

23 A. No, not at all. 

24 Q. No action to — any garnishaent of any 

25 assets or anything, attachments? 



VWUSiffiD 



772 




ALFRED C. DBVENPORT, Otflcial Examiner, Toronto 



(CCllllXULllllML.) D. PRASER 

1 A. H«ll, I wasn't suing him for anything, so. 

2 Q. Do you know Mr. ChorbaniCar? 

3 A. No. 

4 Q. So you navsr had any of bis accounts, to 

5 your icnowladga, blocked? 

6 A. No. 

7 Q. I'm going to show you two pictures, and ask 

8 you if you racognizs aithar of thosa paopla? 

9 A. No, I don't. 

10 Q. I'll giva you this. I'll ba asking you 

11 thasa naaas that appears in this photograph. Okay. 

12 Z'a going to ask you a sarias of naaas. 

13 MR. GAMBLE: Well, do you want to identify 

14 who these people are. They're rather 

15 BY MS. NAUGHTON ; 

16 Q. For the record 

17 MR. GAMBLB: This appears to be a 

18 photograph of someone calling himself Albert 

19 Bakin, B-A-K-I-M, and the other — a rather bad 

20 photograph, of someone by the name of, apparently, 

21 Richard V. Sacord, S-B-C-0-R-D. 

22 And Mr. Frasar can't identify either one of 

23 those gentlemen. 

24 BY MS. NAUGHTON: 

25 Q. Mr. Frasar, I'm going to ask you a series of 



62 



mamm 



773 






ALFRED C. OBVBNrOKf, Otzicial Exaain«r, Toronto 

(iTllll mm I III] D. FRASBR ^ 

1 nancs, and my quaations aa to all of Chan, Mill be tha 

2 saae: That is, hava you avar aithar sat, spoken to, or 

3 heard of these individuals, other than in public media? 

4 Okay? So in other words, if you heard Mr. Khashoggi 

5 mention this name, I want to hear about that. 

( If, however, you've only read about them in 

7 the newspapers, we don't particularly care to hear 

t about that. 
9 A. Is there a chance of getting a glass of 

10 water? 

11 MR. GAMBLB: Certainly. Off the record. 
12 

13 OFF THB RECORD. 

14 

15 EXHIBIT NO. 1: List of Names. 

16 

17 BY MS. NAUGHTON ; 

18 Q. My question was, once again: I'm going to 

19 read to you a series of names, and ask you if you have 

20 ever met, spoken to, or otherwise communicated with, by 

21 letter or memorandum, or heard of these people, other 

22 than in public media and the press. 

23 Elliott Abrams? 

24 A. No. 

25 Q. Charlie Allen? 



mmm 



774 





ALFRED C. DBVENPORT, T>lncraT lxaSW«r, Toronto 

(failliUUIiiJIlJl D. PRASBR ^* 

1 A. No. 

2 g. Adolfo Calero? 

3 A . No. 

4 Q. Carl Spitz Channall? 

5 A. No. 

6 Q. Duana Clarridga? 

7 A. No. 

8 Q. Bdward da Garay? 

9 A. No. 

10 Q. Robert Outton? 

11 A. No. 

13 Q. Crabaa Fuller? 

13 A. No. 

14 g. Rlcbard Gadd? 

15 A. No. 

16 g. Max GoBoz? 

17 A. No. 

18 g. Donald Gragg? 

19 A. No. 

20 g. Albart Hakia? 

21 A. No. 

22 g. Had you aver heard of him? 

23 A. Not really, no. 

24 g. Vfhen you say "not really", do you have some 

25 vague recollection? 



qmnMUFIED 



775 



u 





ALFRED C. DEVENPORT, Official JTaralner, Toronto 

$5 

{o^mntrOfTPki.) o. fraser 



1 


A. 




H«H, today and — mainly today. 


2 






MR. GAMBLE: Thar* is a pictura. One of 


3 


th«B 


is of this gantlaaan. Hakim; wasn't it? 


4 






MS. NAUGHTON: Yas. 


5 


BY. 


JIS 


. NAUGHTON: 


6 


0- 




How about a Manny Copp, C-O-P-P? 


7 


A. 




No. 


8 


0- 




Robert McFarlana? 


9 


A. 




No. 


10 


Q- 




John McMahon? 


11 


A. 




No. 


12 


Q- 




Richard Millar? 


13 


A. 




No. 


14 


Q. 




Aairam Nir? 


15 


A. 




No. 


16 


Q- 




Oliver North? 


17 


A. 




No. 


18 


Q. 




Robert Owen? 


19 


A. 




No. 


20 


Q. 




H. Ross Perot? 


21 


A. 




I have known 


22 


Q- 




Do you know him? 


23 


A. 




I don't know him myself, no, but I've 


24 


discuss 


•d 


him with people. 


25 


Q. 




All right. In connection with business 



mmsm 



776 



Mossm 



ALFRED C. OBVBVllVVfiaTWVniicljbiUk- , Toronto 

( (;jjmfiStt£UiJ 0. FRASBR ^ 

1 dealings? 

2 A. Hoping to do business dealings, but nothing 

3 ever matured. 

4 Q. All right. Here any of these 

5 negotiations — did any of thea involve Triad? 

6 A. No. This is before I knew Triad. 

7 Q. John Poindexter? 

8 A. No. 

9 Q. Al Schwiaaer? 

10 A. No. 

11 Q. Ted Shackley? 

12 A. No. Is that the Shaklee from the 

13 Shaklee 's 

14 Q. Products? No. 

15 A. No. 

16 Q. I don't think so. 

17 A. Because I — no, we were looking at doing 

18 some things along the — similar to the Shaklee stuff. 

19 Q. Howard Teicher? 

20 A. No. 

21 Q. Chuck Tyson? 

22 A. No. 

23 Q. Faith Ryan Whittlesey? 

24 A. No. 

25 Q. Do you know who she is? 



UMmSMED 



777 




ALFRED C. DEVENPORT, Official Examiner, Toronto 

67 

fijuiinieniiirwn o. fraser 

1 A. No, I don't. 

2 Q. When you made trips to Switzerland, did you 

3 aver have any business or go to the Anerican Embassy in 

4 Berne, or the Council in Zurich or Geneva? 

5 A. No. I was only there, I think, once last 

6 year . 

7 Q. Oltay. 

8 A. I think only once. 

9 Q. What about a aan naaed Hillard Zucker? 

10 A. No. 

11 Q. In Switzerland, there is a company — I'll 
13 refer to as CSP. Have you had any dealings with them? 

13 A. No. 

14 g. I may have asked this. I apologize if I 

15 did. But of the money that was advanced, that you 

16 advanced, did any of it get paid back? 

17 A. No, it's not 

18 Q. Okay. So it's just in the bankruptcy state 

19 now? 

20 A. It's still in the bankruptcy state, yes. 

21 Part of it is not — Triad Energy is not in 

22 bankruptcy, so the part that they owe me is still — it 

23 may go into bankruptcy. It's not in bankruptcy yet. 

24 Q. It's in Chapter 11? 

25 A. No. It's not in Chapter 11. 



UJlASSiED 



778 




ALFRED C. DEVENPORT, Official WJIttner, Toronto 



(CMlliiB&llilALI D. PRASBR 



68 



1 

3 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



Q. Is it in reorganization? 

A. Well, it's on* of tha subsidiaries that's 
not in Chapter 11, which probably — you know, the 
trustees will probably bring it into Chapter 11. 

Q. Okay. So what is in Chapter 11 right now? 

A. You would have to get the list of the 
companies froa Salt Lake. Z can't reaember. There is 
about nine or ten coapanies that are in Chapter 11 . 

Q. But what Z'a getting at: in terms of the 
structure, are these coapanies that are owned by Triad? 

A. Triad Aaerica, right. 

Q. Okay. They are all subsidiaries of Triad 
Aaerica, and Triad Aaerica itself. 

Q. Have you ever eaployed or do you know of any 
law fira that at one tiae handled the case involving 
President Nixon? 

A. Not that Z know of. 

Q. When I have asked you the question about the 
Swaai earlier, would it fresh your recollection to 
refer to soae Saudi Arabian in Los Angeles, who might 
have political connections with Senator Cranston? Do 
you know anybody that would fit that description? 

A. No. 

MR. GAMBLE: If we can just go back a 

moment. 0*^ irh^i'ii'Th»^''/iri ahritfait law firm that 





779 



« 





ALFRED C. DEVENPORT, Official Examiner, Toronto 

(CUIIiUBlUlALT D. FRASER ^' 

1 representad former President Nixon, Mr. Fraaer 

2 said no. 

3 If you want to identify the law firm, then 

4 he may be able to answer the question 

5 MS. NAUGHTON: Yes. I don't know. 

6 MR. GAMBLE: —in a more precise way. 

7 MS. NAUGHTON: I don't know. 

8 MX. GAMBLE: Oh, all right. Okay. He has 

9 dealt with a lot of law firms, and maybe one of 

10 them did act for former President Nixon, in 

11 buying 

12 MS. NAUGHTON: Right. 

13 MR. GAMBLE: — a house in California or 

14 something, and he wouldn't know about it. 

15 MS. NAUGHTON: Right. 

16 MR. GAMBLE: Do you see my problem? 

17 MS. NAUGHTON: No. I understand that. 

18 That's as good a description as Z have. 

19 MR. GAMBLE: Oh, okay. All right. 

20 BY MS. NAUGHTON : 

21 Q. When did you first learn of the Iran arms 

22 transaction? 

23 A. From the press. X can't remember the day. 

24 Q. And when did you first hear of Mr. 

25 Rhashoggi ' s involvement? 



mwm 



780 



jmii^ra 



ALFRED C. DEVEt^tyi vJCliaWy Wb aw gr m , Toronto 

70 
PRASER 

1 A. In the press. 

2 Q. Do you remember how soon after? 

3 A. I really don't know. 

4 Q. Were you surprised? 

5 A. Has I surprised? It's his business. It 

6 didn't surprise me, no. 

7 g. Have you ever had any business transactions 

8 with Iranians? That is, people who were under the 

9 Shah, who are now living elsewhere in Europe? 

10 A. My company shipped buildings there previous, 

11 but that was before I owned the company. 

12 MR. GAMBLE: Yes. 

13 THE WITNESS: Well, since I — no, I don't. 

14 I'd have to say no. 

15 Just to clarify that, I have a building 

16 company that had previously shipped buildings to 

17 Iran, but that's before I owned the company. 

18 BY MS. NAUGHTON : 

19 g. Was that at the time of the Shah? 

20 A. Yes, it was. 

21 g. And you haven't done any kind of business 

22 with any Iranians currently running the Iranian 

23 government? 

24 A. No. 

25 g. You had indicated to Mr. Lisker before that 



wmmm 



781 





ALFRED C. DEVEKPoRT, Otticiai Examiner, Toronto 

(C#MliUUIiiJllJ) D. FRASEK ^ 

you did not know • Mr. Hashiml, but had you heard 
anyone speak of hia? 

A. To th« best my knowladga, no. 

Q. Havs you svsr haard of Lake Resources? 

A. No. Just in the newspapers. 

Q. You have not beard oC it prior to that time? 

A. No. 

MS. NAUGHTON: Okay. Those are all the 

questions Z have. 

10 MR. LZSKSK: Okay. Zf Z could ~ with your 

11 indulgence, if Z can could go back and just 

12 finish up, and then move on. 

i: 

14 gXAMZNATZON BY MR. LZSKBR; 

15 Q. My questions basically will go back over 

16 some of what we have previously covered. 

17 Zf an individual comes to you and seeks 

18 financing for a business, what steps do you take before 

19 you offer the money, or undertake to make a commitment 

20 for financing? 

21 A. Well, it will vary, but Z check the 

22 collateral and Z check who the person is. 

23 Q. When you say you check who the person is, 

24 how do you do that? By word of mouth? 

25 A. Crjadlt jc^tiji^^cui^ mammt^^g lilce that. 



mmm "" 



782 



EvfR^n 



ALFRED C. DEVtfifoTfr'arnMlf nCaWner, Toronto 

{G»uriutniiAijn d. praser 

Q. The Dunn t Bradstreet type. Do you ever 
employ independent investigators to make some sort of a 

financial assessment to give you a 

A. Mo, it's usually^ 

Q. — more complete picture? 

A. Usually myself. 

Q. Yourself? 

A. Yes. 

Q. And what resources do you have available for 

10 that sort of check? 

11 A. Myself. 

12 Q. You just call people who — you ask for 

13 references? Do they complete 

14 A. Oh, sure. 

15 A. — some sort of a credit application form? 

16 A. Like if you're referring to why would! 

17 advance to Mr. Khashoggi in this state, 

18 Q. Exactly. 

19 A. — you can go to about forty different banks 

20 that have done the same thing, and haven't even taken 

21 collateral. 

22 Q. Did you go to those forty banks or any of 

23 the banks to check his 

24 A. No. Hell, Z — Z took very good solid 

25 collateral and I took Mr. Miller's recommendation 



UMiLnsnD 



783 




m 



ALFRBO C. DEVBNPORT, Official 8jt«min«r, Toronto 

(C»i Wl BS> PiHi Wi> 0. FRASBR ^ 

1 that 

2 Q. So you f«lt compl«t«ly 

3 A. Z f«lt that I'a tha only craditor that 

4 aacurad. 

5 Q. How do you know that that collataral has not 

6 praviously baan pladgad? 

7 A. Bacausa Z hava it in ay posaasaion. 

8 Q. You bava tb« daada of trust; la that what 

9 you ara saying? 

10 A. Z bava tha Triad Bnargy stock in ay 

11 possassion. 

13 Q. Okay. Z thought thara wara also some real 

13 astata daads that 

14 A. Oh, that's for Vartax. 
IS. Q. Z aaa. 

16 A. 1 wasn't involved in that, as Z said, if 

17 that's what you'ra talking about. 

18 Q. Mava you avar racalvad any commission on the 

19 loans made to Mr. Kbaahoggi? 

20 A. Mo, Z haven't. 

21 Q. Have you traveled to the Middle Bast? 

22 A. Z've traveled — the only place Z've been 

23 be in the Middle Bast is Bahrein. 

24 Q. All right. When was that? 

25 A. Christmaa, three years ago. My wife's 



wmm 



784 




ALFRED C. OrVENPORTyVili<fUkli3UJll«r, Toronto 

(OMfrrDwrrram d. fraser ^^ 

1 aistar lives there. 

2 Q. I see. You've never been to Saudi Arabia? 

3 A . No. 

4 Q. Nor Israel? 

5 A. No. 

6 Q. Nor Lebanon? 

7 A. No. 

8 Q. Do YOU know a aan by the naa* of Bandar Bin 

9 Sultan al-a Azix? Prince Bandar, B-A-N-D-A-R, Bin, 

10 B-I-N, Sultan, S-U-L or 0-L, T-A-N, al, A-L, dash A, 

11 A-Z-I-2, A2ix. 

12 A. I'm going to answer this carefully, because 

13 I met a Saudi prince at the opening of Mr. Carter's 

14 Library, and I'm not sure whether that was — I forget 

15 the name of who I met. 

16 Q. Do you recall what he looked like? Could 

17 you describe him? 

18 A. No. 

19 Q. Was he in 

20 A. No, he was 

21 Q. — Saudi dress? 

22 A. No, he wasn't. He was in western dress. 

23 Q. Beard, mustache, round face? 

24 A. I think — I'm trying to think if he had a 

25 beard. ^ WJa^tt^* lakejx that^resident Reagan was 




785 



s "JW'RIISBWHIlJLi , 



ALFRED C. DEVEllP<3RT^9WTWlf^»WWyi-, Toronto 

75 



D. FRASBR 

1 ther* that day than anything elsa. Thera was a lot 

2 peopla thara. 

3 Q. Was ha introducad to you as tha Anarican 

4 ambassador — tha ambassador to tha U.S.? 

5 A. Yas. 

6 Q. Thanks. Okay, that would ba hla. 

7 A. Ha wasn't introducad to aa. Ha spoka. Ha 

8 did a presantation. I'va navar baan introducad to him, 

9 although I saw hia. Ha did a — ha spoka at the affair 

10 thara. 

11 Q. And did you speak to hia at all? 

12 A. No, Z didn't. 

13 Q. And that was your only contact with this 

14 individual? 

15 A. Yas. 

16 Q. The Swaal, the elusive Swani, Mr. Swamaji 

17 Maharaj (phonet.) — who seems to have enormous 

18 influence on the Sultan of Baonai and several U.S. 

19 politicians and a few heads of State around the 

20 world — had you ever heard his name before? 

21 A. I know a Swami, okay. I met him through Mr. 

22 Miller, but that's the only way Z met him. Z met him 

23 for the first time sometime last year. Z'm not sure of 

24 when it was. 

25 Q. Has he in sort of robes and with jewelry 



mmm 



786 



ALFRED C. OEV 



UHRjinsiiia 



r, Toronto 



(LUllliUBlli|lJllJl 0. PRASER 



76 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



and 

A. Uh-huh. 

Q. Okay. Vhara did you a«*t hia? 

A. Z Bat hia savaral tlacs. Z'v* m«t hla at 
Mr. Millar '■ hcus* h«r* in Toronto, and Z'va act hia at 
Mr. Khoshaggi's apartacnt. Z can't raaeabcr anything 
•Is*. And Z act hia in Los Angelas. H« was in 
Vancouvar, but Z don't think Z aat hia that tiaa whan 
ha was in Vancouvar. 

Q. Zn thasa various aaatings which you'va just 
dascribad, what tiaa pariod ara wa spaaklng oC? 

A. Oh, in tha last sight to tan aonths, I 



think. 

Q. 
presant? 

A. 

Q- 

A. 

Q. 
Swami? 

A. 

Q. 

A. 
generally. 

Q. 



And on how aany occasions was Mr. Khashoggi 

Z don't remember. 

Was he generally present? 

Z'd say half the times, Z guess. 

Did you have any conversations with the 

No. 

With 

I've talked to him, but, you know, just 

Do you have any sense of the influence which 



mmm 



787 



ALFRED C. DEV 




r, Toronto 



SER 



77 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



the Swami exerts on Mr. Khashoggi? 

A. None whatsoever. 

Q. Does it strike you as bizarre that Mr. 
Khashoggi is frequently in the company of the Swami? 

A. Not at all. 

Q. Do you undarscand what the role of t.-.e Swami 
is in any of this? 

A. No, I don't. 

Q. Is h« a social acquaintance, a financial 

advisor, a business partner? Do you have a sense of 
where it fits? 

A. No, no. He has a lot of followers. Like I 
was at his — I attended his birthday party, and 
Elizabeth Taylor was there, and there was all kinds of 
people. 

Q. At the Swaal's? 

A. Yes. 

Q. Are you aware of any of the Swami 's business 
enterprises? 

A. None. 

Q. Do you know anything about the Swami ' s 
relationship with the Sultan of BMinei? 

A . None . 

Q. And I think you said previously that you are 
not aware of any financial relationship between the 



UNM^IED 



788 





ALFRED C. DEVENTORT, TJlTfrtM'Slniminer, Toronto 

7 8 

1 Sultan and Mr. Khashoggl; is that correct? 

2 A. I don't know of any, no. 

3 Q. Have you «v«r haard of a company called ISI? 

4 It doesn't stand for anything, just the initials ZSZ. 

5 A. No. 

6 Q. Have you ever been solicited by anyone, 

7 directly or indirectly, for funds to support the anti- 
• Sandinista forces? 

9 A. No. 

10 Q. Do you have under your direction or control, 

11 or are you participating in any coapanies which are 

12 registered in Panaaa? 

13 A. Z had one, but I think it's probably not in 

14 force now. Well, I'd say no now. Z had one, but it's 

15 . not related to anything that 

16 Q. That you owned exclusively? 

17 A. Z owned fifty percent with another party, 
16 but it's — I'm sure it's fifty percent with another 

19 person, but it had nothing to do with this. And it 

20 goes beck about four or five years now, Z would say. 

21 g. Z see. You had said previously that you do 

22 not know Michael Ledeen? 

23 A. Right. 

24 Q. Zs that correct? 

25 A. Right. 



iKHnwe 



789 



H 




ALFRED C. 0EVBN||||||&|ei|:9»\**i«l«t Toronto 

(rnNffTni-MTT^fc) 0. FRASER ^ 

1 Q. Do you know Richard Pcarlc? 

2 A . No . 

3 Q. P-B-A-R-L-B. Do you know Stephen David 

4 Bryan, B-R-Y-B-N? 

5 A. No. 

6 Q. That's S-T-B-P-H-B-N. 

7 MK. LZSKBK: Z baliavc thos* ara all tha 

8 quaations that Z hava. Thank you. 

9 MS. NAUGHTON: Can Z aak ona aora? 

10 MR. GAMBLE : Cartainly. 

11 MS. NAUGHTON: Okay. 
12 

13 BXAMZNATZON BY MS. NAUGHTON; 

14 Q. Mhan you would saa tha Swaai in tha company 

15 of Mr. Khashoggi or othara, what wara thay discussing? 

16 A. Z wasn't thara to haar thaa discuss 

17 anything. 

18 Q. Hall, now Z'm confusad. Wara you in tha 

19 aaaa rooa with thaa? 

20 A. Vary raraly. Z'd saa thaa talking but like 

21 if Z was thara. Zt would just be in and out, and I 

22 would ba introduced, but Z would not be sitting around 

23 discussing anything with thaa. 

24 Q. All right. But did you haar what they were 

25 diacuasing? 



HMOIiJklifiKIED 



790 



ALFRED C. DEV 



rH 




fj 




er, Toronto 



LCniirTDilWlOh) D. FRASER 



80 



8 
9 

10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



A. No. 

Q. Th«y would stop when you got into the room? 

A. Z really wouldn't be paying — like if I 
came in to the rooB where they were, Z would probably 
be just in and out to speak to Mr. Miller or Adnan for 
something, and then Z would be out, but Z've never sat 
in a room and discussed things with them. 

Q. All right. Do you know whether or not Mr. 
Miller did any business with them, with the Swami, in 
particular? 

A. Oh, they are very good friends. Z 

Q. But do you know if they did any business 
together? 

A. No, Z don't. 

MS. NAUGHTON: Okay. That's all Z have. 
MR. LZSKBR: Thank you very much. 
Off the record. 

(OZSCUSSZON OFF THE RECORD.) 

MR. GAMBLE: The undertakings between 
Counsel are now going on the record. 

MR. LZSKER: In portion one of the 
deposition, in the deposition which we conducted 
before we left, part of that record, my 



UMHSSiED 



791 




ALFRED C. DEVENPORT, Off icial TaWKfiWlV Toronto 

(o oMri B airTiAiii i^ D. fraser 

un<l«rtaking simply is this, as simply stated as I 
can: That in tarms of tha paynent for this 
deposition, since the Senate was involved in its 
portion of the deposition with the House, and the 
observers, that the Senate will, under its rules, 
assume financial responsibility for that portion 
of tha record. 

Because the Senate has not participated in 
the second portion of the record, conducted by the 

10 Independent Counsel , under our rules , we are 

11 prohibited from paying for that portion, so that 

12 other arrangements will have to be made. 

13 It is further my undertaking that upon 

14 receipt of the original deposition, which Miss 

15 Naughton and I participated in, that a copy will 

16 be sent by overnight mail, immediately, to Mr. 

17 Gamble for his use, provided that he agrees with 

18 an understanding that the transcript will be 

19 neither quoted from, nor reproduced, and that no 
30 dissemination beyond Mr. Gamble and Mr. Fraser 

21 will be made. 

22 MR. GAMBLE: Yes. And I agree with that 

23 undertaking, subject to on* qualification, that 

24 the transcript may, indeed, be used in any further 

25 proceedings in which the Senatiror the House of 




792 



MKd 



ALFRED C . °B^B''Pff fITflf ^ffVXl|"liPll Toronto 
( Q Bi rriDBIHlJIlJ) D. FRASBR 

1 Representatives may be Involved. 

2 MR. LISKER: That's fine. 

3 MR. GAMBLE: But otherwise the material 

4 will be kept strictly confidential, and only Mr. 

5 Fraser and myself will have access to it. 

6 MX. LXSKBR: Now, with respect to 

7 Independent Counsel, it's ay understanding, in 

8 speaking with Mr. Paul JtrheaTrt (phonet.), that 

9 in order to make a dissemination of our portion, 

10 of the transcript, the Senate's portion of the 

11 transcript, to the Independent Counsel, a vote of 

12 the Committee will be required. 

13 He has given me to understand that that is a 

14 pro forma matter, and that there is nothing which, 

15 to his knowledge, or to my knowledge, would 

16 preclude such dissemination. And, in fact, both 

17 b« and I, and those involved in this 

18 investigation, will make every effort to arrange 

19 Cor the transmission of this document to the 

20 Independent Counsel as soon as the vote is 

21 completed; and that should be as' soon as possible. 

22 MS. BBBN: Okay. And I'd like to put on 

23 the record — Vicki Been, from the Independent 

24 Counsel's Office — that we agree to to go forward 

25 with our interview on the basis of the 



32 



MI0M68IFIED 



793 



mmm 



ALFRBD C. DEVENPORT, Official Bx«min«r, Toronto 
frnHITlilEirTTflTil 0. FRASER 

1 undertaking, to provide us with a transcript of 

2 this Borning's session, the first session. That 

3 we understand that the Senate has to go through 

4 the foraality of taking a vote. That we further 

5 understand that they will do everything possible 

6 to Bake sure that that vote is to give the 

7 transcript to the Independent Counsel . And that 

8 we agree to this arrangsBent on the understanding 

9 that we would not object to Mr. Praser providing 

10 the Senate with a copy of his transcript, in 

11 exchange for the Senate not blocking us from 

12 getting a copy of the Borning transcript. 

13 MR. LISKBR: That's fine. We're parting 

14 friends. 

15 MR. GAMBLE: Now, just let ac suggest that 

16 we take this intervention and discussion among 

17 Counsel froB the place where it appears in the 

18 transcript, as it now exits, and put it 

19 iaaediately at the end of the conclusion of 

20 Counsel's exaaination of Mr. Praser. So that we 

21 can place it where it belongs, and assume that 

22 there was simply a recess while all this 

23 discussion went on, and we're now on with Mr. 

24 Dreibelbis again. 

25 MR. LISKBR: Okay. 



83 



nWllliASSiriED 



794 




ALFRED C. DEVEW«lVn^lMnM.MItxftlnMr, Toronto 
(GOMUBBHTPAL) 0. FRASBR 

1 MR. GAMBLE: All right? 

2 MR. DREIBELBIS: Certainly. 

3 MR. LZSKER: Thank you v«ry much. 

4 MS. NAUGHTON: Okay. Thank you all. 

5 MR. LISKBR: By*, by*. 

6 MR. GAMBLE: Thank you. 
7 

8 

9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



84 



UihttiltlilED 



795 



21 
22 
23 





ALFRED C. DEVBNWlW"Mffl<*ffrTnc«Buner, Toronto 

85 

1 PROVINCE OF ONTARIO ) 

2 CITY OF METROPOLITAN TORONTO ) 

3 JUDICIAL DISTRICT OP YORK ) 
4 

5 I, Sonia V. Bowra, Chart«r«d Shorthand Reporter , 

6 do haraby cartlfy: 

7 That tha Hltnaaa in tba foragoing Intarvlaw 

8 Oaposition naaad DONALD FRASBR, appaarad bafora aa and 

9 was in my praaanca sworn to tall tha truth, tha whola 

10 truth and nothing but tha truth for tha Intarvlaw 

11 Daposition; that tha said Intarvlaw Deposition was 

12 stanographically reported by ne and was thereafter 

13 transcribed into printed booklet form, all to the best 

14 of my knowledge, skill and ability. 

15 I further certify that I aa not counsel nor 

16 attorney for either or any of the parties hereto, nor 

17 aa X in any way interested in the outcome of tha issues 

18 in this matter. 

19 IN WITNESS WHEREOF, I have hereunto set my hand 

20 this ""^^ d ST of ^'^h l"''- 



%- 

^aC ^"^- 



24 SONIA V. BOWRA, C.S.R. 

25 



UHSWHED 



796 



ALFRSO C. OBVBNPO 



mmm 



oronto 



(G^ne&niSn d. prasbii 



1 

3 

3 

4 

5 

« 

7 

8 

9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 

22 

23 

24 

25 



PROVmCl Of ONTARIO ) 

CITY or MBTROPOLITAN TORONTO ) 
JiroiCIAL DISTRICT OP YORK ) 



Z, Alfred C. O«v«nport, do hereby certify: 

That Z •» en Official Bxaainer of the Province of 
Ontario, Canada, authorized under the Laws of the 
Province of Ontario, to adainister oaths of 
Oapoeitions; 

That the witness in the foregoing Interview 
Deposition, naaed DONALD PRASBR, was duly sworn to tell 
the truth, the whole truth and nothing but the truth in 
this Interview Deposition. 

I further certify that I aa not counsel or 
attorney for either or any of the parties hereto, nor 
aa I in any way interested in the outcoae of the issues 
in this aatter. 

IN HITNBSS HHBRfOP, I have hereunto set ay hand, 
^^^ dav of IT^»*\ . 1987. 



this 



_day of 




A. C. DBVBNPORT, Official 
Bxaainer in and for the. 
Judicial District of York. 



U 





797 



UNCLASSIFIED 



IMOTICE 

OtML-Y «LJ-rMORIZED l=>E RSOIMIMEI_ 
«RE m_l_OUJED IIM THE Of=-F="ICE. 
«l_l_ DOORS ARE TO BE KEP»T- 
l_OCKED- -rms P>OL_ICV^ IS 

EI="R"ECT-I V<*E I MMED I «-rEI_V_ 






'A 



under prov,s«ns Of E t^T^TT^^^ 
"Vlf Johnson, fe„(,„,| ,„'^ '■ -'' 




S353 



- JXHIBIT 



JM 000050 



UNCLASSIF8ED 



798 



UNCLASSIFrtD 



aJc ad< 



ABRAMS, Elliott 
ALLEN. Charles 




Tame: 

BEEMUDE2, Enrrquez 
BREKNEKE. "Richard J^.' 
CALERQ, Adolfcr' - --i 
CALERO, Mario'-- -' 
CAilNISTRARO, Vi.-.ce 
CXSRILES, L-is Poiada- " -•-.:. 
CASTILLO^. Thomas 
CA7F,;'.'Ceorge - - ' "- ' . ■- - 

CKa;jN£tt; caH-ft. { spitz) 

CHA7E27CLiftda- --■■■ 
CLARB±E>CE,:?)\iafie "Dewey" 
CLIlfES:;'. Thomas 

COOPER?,.'. wi,nVaBh - - 

CONRAD',. Oahrtl- ' - ' 
CUTTER,. , 'Paul -'^^■ 
de GARAY', Edwan:^ -- - ' 
deGRAFFENRBiS, Ken 
da MIRAHQ^, TTres 
DUEKtnW*,' Ambassador Robert 
DUTTON, Robert 
EARLE, Robert =- 
EISENBERG, Guri i Israel 
FERCH. John 



libit No. 
on tha (xunlnatlon of! 

^e d on i^CJ^W^r^.A 19 '^; 
ALFRED C.DEVENFO"" _ 
\ C":2lE.af'cr -'j3 

\ - ^ ( - 



FISCHER, Oavid 
ERASER,; Dcmald 
FULLER^ - Graha»"- 
FURMXRCK;iRoy '- 
GADU," Ricjiard - - 
GAIIWDOD, Ellen 
GHOI^BANII^All, Manuchehr 
GILLESPir,'- Lt. Col. Wayne 
GQiasON; Roy ■ 
G0HE2 , FranJc j 
GOMEZ", ttsx - -' 
GOCQMAlt^ Adaa 
GRdSG^ tJonaid-'"- '' 
hakim; Ktidrt 
HULC, ■John*' -"^ 
KHX^HOCiGX ; - Adnan 
KIMCHE, Oa^ld- 
KOJtLISlrtlnaa 
LAWSTON, Wiili%4'-- 
LEUttlt, Nlr^ael 
LILAC, Robert H. 
HcFARLAME, Robert 
McMAHON, John M. 



Pa™allvDec,as3lfied/flefeased0Pj0F«B88 
umter provisions Of EO ;2j^i 

"VK. Johnson, Nano„a.S.ca4cconc. 




5<^54 



UMCLASSIF5 



^ IXHIBIT 
i ^tMi fcxV.toA 



799 



MAESTRI, Raphael 
MATTES, John 
MEDINA, Ramon 
MENGES, Constantine 
MILLER, Ernest 
MILLER, Richard 
MILLER, Walter 
MOLL, Herman 
M0SSA2 , Jacques 
NIMRODI, Yaacov 
NIR, Amiram 
NORTH, Oliver 
OWEN, Robert 
PEROT, H. Ross 
POINDEXTER, John 
POSEY, Tom 
QUINTERO, Raphael 
REICH, Otto 
RODRIGUEZ, Felix 
SANCHEZ, Nestor 
SAWYER, Wallace 
SCHWIMMER, Al 
SECORD, Richard 
SHACKLEY, Theodore 
SHAHEEN, Daniel 
SINGLAUB, John K. 
SPORKIN, Stanley 
TAMBS, Ambassador Lewis 
TEICHER, Howard 
TERRELL, Jack 
TRACY, Larry 
TYSON, Charles B. 
WATSON, Sam 
WHITTLESEY, Faith Ryan 
ZUCKER, Willard 



UNCLASSIFStd 



UNCLASSIFIED 



801 



M*JJ» KtfOOTMO CO . MC. 
107 C Sucn N E 
Wuhuifian. D C 20002 
■ lO.'l 146-6664 






CR\(rlK)M 



SELECT COMMITTEE TO INVESTIGATE COVERT 

AFIMS TRANSACTIONS WITH IRAN 

U.S. HOUSE OF REPRESENTATES 

AND 

SELECT COMMITTEE ON SECRET MILITARY ASSISTANCE 

TO IFLAN AND THE NICARAGUAN OPPOSITION 

UNITED STATES SENATE 

Wednesday, July 1, 19 87 
Washington, D.C. 
Deposition of EDIE ERASER, taken on behalf of 
the Select Committees above cited, pursuant to notice, com- 
mencing at 1:44 p.m. in Room 901 of the Hart Senate Office 
Building, before Terry Barham, a notary public in and for the 
District of Columbia, when were present: 
For the Senate Select Committee: 



THOMAS McGOUGH, Esq. 
Associate Counsel 



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LAWRENCE EMBREY 
Senior Investigator 



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For the House Select Comnittee: 

SPENCER OLIVER, Esq. 
Associate counsel 

THOMAS FRYMAN, Esq. 
Staff counsel 

BILL DAVIS 
Investigator 

For the deponent: 

JERRI S LEONARD, Esq. 

ROBERT CASEY 

Manatt, Phelps, Rothenberg, Tunney & Evans 

1'200 New Hampshire Avenue, N.W. 

Washington, D.C. 20036 

CONTENTS 

Examination by counsel for 

Senate Select Committee (Mr. McGough) 

House Select Committee (Mr. Oliver) 

Senate Select Committee (Mr. Embrey) 

EXHIBITS 

Fraser Exhibits 

1 

2 and 3 



4, 4-A, 4-B 



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EXHIBITS 


(contd) 




Fraser Exhibits 






Marked 


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P5.0Q.I.EDI.NGS 
Whereupon, 

EDIE FRASER 
was called as a witness and, having been first duly sworn, 
was examined and testified as follows: 

EXAMINATION BY COUNSEL THE SENATE 
SELECT COMMITTEE 
BY MR. McGOUGH: 
Q M,s . Fraser, my name is Tom McGough, I'm associate 
counsel with the Senate Select Committee; seated to my left 
is Tom Fryman who is associate counsel with the House Select 

Committee. I will be asking the questions initially; Mr. i 

i 

Fryman will then conduct his questions on behalf of the House j 
Committee. We are conducting a joint investigation, as you I 
are probably aware. j 

MR. OLIVER: I may also have some questions. 
BY MR. McGOUGH: 
Q Mr. Oliver, also representing the House Committee, 
may also have some questions. 
A Certainly. 

MR. McGOUGH: Let's have this marked as Exhibit No. 
1. 

[The document referred to was marked for iden- 
tification as Fraser Exhibit No. 1] 



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BY MR. McGOUGH: 
Q MS. Fraser, let me show you what has been marked as 
Exhibit NO. 1. It consists of a deposition subpoena and a 
subpoena duces tecum, requesting production of certain 
documents . 

Did you receive a copy of this subpoena? 

A Counsel showed it to me today, yes. 

Q Did you bring with you, Ms. Fraser, certain 
jiocuments in response to that subpoena? 

A I believe we've got all relevant documents. 

Q All right, can we take a look at what you brought 
|ith you? I'm sorry, you say you believe you produced all 



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13 |he relevant documents, or you have them with you right now? 

14 A we think-correct me-we gave Larry Embrey the 

15 relevant documents of what was requested. And I think those 

16 ire the documents that are warranted. 

^^ ^- LEONARD: To our knowledge, I think we have 

18 provided you at our last meeting, Mr. Embrey, with all the 

19 documents. Our conversation related to originals. i don't 

20 tiink MS. Fraser has any originals other than those which may 

21 hive been given to you. 

^^ "''• EMBREY: We also discussed on the phone 

23 attachments, and there were attachments indicated on the 
2.4 c|rrespondence. We discussed that in our phone conversation. 
THE WITNESS: .1 _think_w^_ have all of those . The 



»i5. 



WITNESS: I think wehav^ 



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llHCUSSifiiB 



attachment that bears on basically the letter to Mr. North 
listing the background is the background paper — and this is 
the fact sheet on the Nicaragua Refugee Fund attachment. 
Attachment was basically the leadership of the Nicaragua 
Refugee Fund. 

MR. McGOUGH: Well, let's do this: just so the 
record makes a little more sense when we start talking about 
attachments, let me mark two exhibits, Exhibits 2 and 3, 
Exhibit 2 being a letter dated December 27, 1984, to Oliver 
North from Edie Fraser, and Exhibit 3 being a letter of March 
4, 1985, to Oliver North from Edie Fraser. We will identify 
those first. 

[The documents referred to were marked for 
identification as Fraser Exhibits Nos . 2 and 

3] 

THE WITNESS: That's correct. To Exhibit 1, which 
is the prior letter, December 27, the background papers are 
the fact sheet and the request form, right? 
BY MR. McGOUGH: 

Q Let's slow down for a moment here. I think you are 
referring to the letter of December 27, 1984, that is Exhibit 
2, and you have handed counsel two documents. 

A "Overview of Nicaragua Refugees." 

Q And the second document is? 

A "Nicaragua Refugees." 



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Q And you believe that those were the attachments 
referred to in the letter of December 27? That's Exhibit 2. 

A No, I'm sorry, those were the attachments to the 
letter of December 12th. 

MR. McGOUGH: All right, let's mark December 12 as 
an exhibit. 

[The document referred to was marked for iden- 
tification as Fraser Exhibit No. 4] 
Now, this is Exhibit 4 — and we will make sure that 
everybody walks away with copies of everything marked as a 
deposition exhibit. 

BY MR. McGOUGH: 
Q But you believe that the two documents that you 
have identified before, the headings being "Overview of 
Nicaraguan Refugees" and "Nicaraguan Refugees," the latter 
being a two-page document, were the attachments to the 
December 12 letter? 
A I do. 

MR. LEONARD: Counsel, can I suggest that we mark 
those 4-A and 4-B for the record? 

MR. McGOUGH: That's a splendid idea. 

[The documents referred to were marked for 
identification as Fraser Exhibits Nos . 4-A 
and 4-B] 
THE WITNESS: Excuse me, can I just see the 



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December 27th? I just gave up my copy. 

BY MR- McGOUGH: 
Q Let's refer, then, to what has been marked as 
Exhibit 2, the December 27, 1984, letter, if you would. Take 
a look at what has been marked as Exhibit 2, and that is the 
letter of December 27, 1984. That letter also refers to 
attachments . 

Take a moment and attempt to determine if you have 
the attachments to that letter. 

A Did we give that to you last time, that is, not the 
attachment — the attachment was just the background on the 
Sultan of Brunei, and I don't have that with me — I thought we 
gave that to you. We should have it in the file. 

MR. EMBREY: I obtained two documents, and those 
are the ones that are marked 2 and 3 . 

THE WITNESS: I don't think that ever went to the 
White House; I mean, this was internal. 

MR. LEONARD: Was that an attachment to this letter? 

THE WITNESS: I don't believe so, no. This was the 
attachment which is the background — this is the attachment 
which is basically the background on the Sultan of Brunei, 
just the background. 

MR. McGOUGH: We are going to have to have that 
marked as another exhibit, then, because when you refer to 
this the record is not going to be particularly clear. This 

mini looinrn 



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should be marked Exhibit 5. 

MR. LEONARD: I don't think so. I think it should 
be marked 2-A so it is connected with the letter to which it 
relates . 

MR. McGOUGH: I understand your point, Jerris, but 
let's mark it 5 because it's actually a separate letter dated 
the day after the December 27 letter. 

[The document referred to was marked for iden- 
tification as Eraser Exhibit No. 5] 
BY MR. McGOUGH: 
Q For the record, would you just describe that 
document by addressee and date, Ms. Eraser. 

A The letter is to Oliver North; it's the background 
on the Sultan of Brunei. 

Q And it's dated December 28, 1984? 
A That is correct. 

Q Now, Exhibit 2 is a letter dated December 27, 1984, 
to Oliver North, is that correct? 
A That is correct. 

Q Now, with reference to any of the exhibits in front 
of you, do you have an opinion or recollection as to what the 
attachment was to the letter of December 27? 

A My recollection is that this was the attachment; it 
says "On the background of the Sultan of Brunei." This is 
the attachment to the letter of the 28th. 



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Q Exhibit 5. 

A Yes, correct. 

Q So that you sent a le