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

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



Senate Report 

No. 216 




IRAN-CONTRA INVESTIGATION 

APPENDIX B, VOLUME 13 
DEPOSITIONS 



United States Congressional Serial Set 

Serial Number 13754 



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 13 
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 



lanited 3tatt5 3tnatt 

SELECT COMMITTEE ON SECRET MILITARY 

ASSISTANCE TO IRAN AND THE NICARAGUAN OPPOSITION 

WASHINGTON, DC 20510-6480 



March 1, 1988 

Honoreible 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 20515 

(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 Affair , 
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 f op-^release to the public. 




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 with Iran 

Lee H. Hamilton, Indiana, Chairman 
Dante B. Fascell, 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 Courter, 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. Ken- 
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. 

Small wood* 
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 



Special Deputy 

Chief Counsel 
Staff Counsels 



Press Liaison 
Chief Clerk 
Assistant Clerk 
Research Director 
Research Assistants 



John W. Nields, Jr. 
Chief Counsel 

W. Neil Eggleston 
Deputy Chief Counsel 

Kevin C. Miller 
Staff Director 



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 
Systems 

Programmer/ 

Analysts 
Executive Assistant 
Staff 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 



Associate Minority 

Counsel 
Assistant Minority 

Counsel 
Minority Research 

Director 



Thomas R. Smeeton 
Minority Staff Director 

George W. Van Cleve 
Chief Minority Counsel 

Richard J. Leon 
Deputy Chief Minority Counsel 



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. 

Ciehanski 
William A. Davis, 

III 
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 
G. R. 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 

Courier 
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 13 



Preface XXI 

Hakim, Albert 1 



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., III. 
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. 

Galvin, Gen. John R. 

Gantt, Florence. 

Garwood, Ellen Clayton. 

Gast, Lt. Gen. Philip C. 

Gates, Robert M. 

Glanz, Anne. 



Rudd). 



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. 
Hasenfus, Eugene. 
Hirtle, Jonathan J. 
Hooper, Bruce. 



Volume 13 



Volume 14 



XVII 



Hunt, Nelson Bunker. 
Ikle, Fred C. 
Jensen, D. Lowell. 
Juchniewicz, Edward S. 
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., 
Ledeen, Michael A. 



Jr. 



Volume 15 



Volume 16 



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 17 



Volume 18 



XVIII 



Miller, Richard R. 



Motley, Langhorne 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., H. 
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 C. 
Singlaub, John K. 



Slease, Clyde H., III. 
Smith, Clifton. 
Sofaer, Abraham D. 
Steele, Col. James J. 
Taft, William 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., III. 

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 refiising 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 



Not far QMtatloa or 
DapUoittoa 



mMW 



mT^ 



Committee Hearings 

oTUm 

UA HOUSE OF REPRESENTATIVES 



W 



OFFICE OF THKCLEBK 
Office of < ' 




Partially Oedassitied/Releasea on ^-M l 

undpr provisions ol E 12356 

by K Johnson National Security Council 



WTommn 3 A f -3 COpn 



DINKEL 
GILE 



UNCLASSinED 



2 
3 

4 Deposition of Albert Hakim 

5 House Select Committee to 
Investigate Covert Arms 

6 Transactions with Iran, jointly 
with the Senate Select Committee 

7 on Secret Military Assistance to Iran 
and the Nicaraguan Opposition 

8 

9 Monday, April 20, 1987 un*. p.nv.s.ons ot e o 12356 

•V K Johnson. Naiional Sscunty Council 
10 

11 

12 The deposition of Albert Hakim was convened in the law 

13 offices of Paul, Weiss, Rifkind, Wharton § Garrison, 199, 

14 Boulevard Saint-Germain, 75007, Paris, France at 10:05 a.m. 

15 Present were: 

^8 Representative Dick Cheney, on behalf of the House Select 

17 Committee to Investigate Covert Arms Transactions with Iran, 

^* and Senator James A. McClure, on behalf of the Senate Select 

^9 Committee on Secret Military Assistance to Iran and the 

*^ Nicaraguan Opposition. 

2* On behalf of the House Select Committee to Investigate 

*^ Covert Arms Transactions with Iran: John Nields, Chief Counsel; 

*^ George Van Cleve, Deputy Minority Counsel; James J. Black, 

** Investigator. 

2' On behalf of the Senate Select Committee on Secret 



UNCLASSIFIED 



16 
16 
17 
18 
19 
20 
21 
22 
23 
24 
28 



UNCLASSIFIED 



1 Military Assistance to Iran and the Nicaraguan Opposition: 

2 Cameron H. Holmes, Associate Counsel; Louis Zanardi, Inves- 

3 tigator; John Cronin, Chief Accountant. 

4 On behalf of the witness: N. Richard Janis and Lawrence 

5 H. Wechsler, Janis, Schuelke § Wechsler, 1728 Massachusetts 

6 Avenue, N.W. , Washington, D.C. 20036. 

7 Also present via telephone conference call: Representative 

8 Lee H. Hamilton, Chairman, House Select Committee to 

9 Investigate Covert Arms Transactions with Iran, and Senator 

10 Daniel K. Inouye, Chairman, Senate Select Committee on 
1' Secret Military Assistance to Iran and the Nicaraguan 

12 Opposition. 

13 Also Present: Joseph S. Iseman, Paul, Weiss, Rifkind, 
1* Wharton § Garrison, 199, Boulevard Saint-Germain, 75007, 

Paris, France. 



UNCUSSIHED 



DINKEL/mag 



10: 05 a.m. 



DNIWSSW 



MR. HAMILTON: We are waiting. 

MR. NIELDS: The first item of business is to swear 
the witness. 

MR. CHENEY: We are here today to convene a joint 
meeting of the House and Senate Select Committees on the 
Iranian matter and to take testimony from one Albert Hakim. 

I would like to begin, first of all, on behalf of 
the House Committee by swearing the witness. I would ask 
Mr. Hakim to stand and respond to the following oath. 

(The witness was sworn by Mr. Cheney.) 

SENATOR MCCLURE: May I, on behalf of the Senate 
Committee, administer the same oath, Mr. Hakim? 

(The witness was sworn by Senator McClure.) 
Whereupon, 

ALBERT HAKIM 
was called as a witness and, having been duly sworn, was 
examined and testified as follows: 
EXAMINATION 

BY MR. NIELDS: 
Q Mr. Hakim, this is a joint proceeding being 
conducted by the Select Committee to Investigate Covert Arms 
Transactions with Iran of the United States House of 
Representatives and the Select Committee on Secret Military 
Assistance to Iran and the Nicaraguan Opposition of the 



United States Senate. 



iiMpi k^mm 



19 
20 
21 
22 
23 
24 
26 



yNtUSSlfe 



1 The House Select Committee proceeding is a 

2 deposition conducted pursuant to Committee Rule 7, and the 

3 Honorable Dick Cheney, the committee's ranking minority 
^ member, is presiding. 

5 The Honorable Lee H. Hamilton, Chairman of the 

House Select Committee, is listening to this deposition on 
' a speaker phone telephone hook-up and is prepared to make 
^ rulings over the speaker phone if it becomes necessary to 
do so. 

Mr. Chairman, can you hear us? 

MR. HAMILTON: We can hear you, John, only faintly. 
^^ I think it would help if you speak up. 

^3 MR_ NIELDS: I will talk louder, and I will ask 

'* others to do the same. 
'* MR. HAMILTON: That is much better. 

MR. NIELDS: The Senate Select Committee proceeding 
'^ is a hearing being conducted pursuant to its rules with the 
'* Honorable James A. McClure presiding. 

The Honorable Daniel K. Inouye, Chairman of the 
Senate Select Committee, is also listening to this deposition 
on a speaker phone telephone hook-up and is also prepared 
to make rulings over the speaker phoi^i^ it- b#|Omes 

necessary to do so. yjJ\|U\OUintU 

Mr. Chairman, can you also hear me? 

SENATOR INOUYE: Yes, I can hear you very clearly. 



UNCLASSIFIED 



t MR. NIELDS: Thank you. 

2 I am John Nields, Jr., Chief Counsel of the House 

3 Select Committee, and by written authorization of Chairman 

4 Inouye, I am authorized to ask questions on behalf of both 

5 committees simultaneously. 

6 The House Committee is also represented by George 

7 Van Cleve and the Senate Committee by Cameron Holmes, both 

8 of whom are in the room with us. 

9 I am marking for the record as Exhibits 1 and 2 of 

10 this deposition copies of subpoenas issued by each committee 

11 to you, Mr. Hakim, and I will ask your attorney, Richard 

12 Janis, whether Mr. Hakim authorized the firm of Janis, 

13 Schuelke & Wechsler to accept service of these subpoenas in 

14 the United States, whether the firm has, in fact, accepted 
16 service of these subpoenas, and whether Mr. Hakim is 

16 testifying today pursuant to these subpoenas. 

17 MR. JANIS: The answer to all your questions, 

18 Mr. Nields, is yes. 

19 (Exhibit Nos. 1 and 2 were 

20 marked for identification.) 

21 BY MR. NIELDS: 

22 Q Mr. Hakim, these committees are inquiring into 

23 the sale of TOW missiles and Hawk missile spare parts by the 
2* United States to agents and officials of the government of 

Iran. 



25 



UNCUSSIFIED 



10 



«Lftssro 



1 Specifically, the committees want to know what 

2 happened to the money paid for those missiles. 

3 Do you have any knowledge of such transactions? 
^ A On the advice of counsel, I must respectfully 

5 decline to answer that question on the basis of my rights 
^ under the Fifth Amendment to the Constitution of the United 

States. 

® Q Mr. Hakim, the committees are inquiring also into 
^ the source of funds which supported the military efforts of 

the anti-government forces in Nicaragua. 



'' Do you have any knowledge concerning the source of 

1 3 

funding for those efforts^ 

'* A On the advice of counsel, I must respectfully 

decline to answer that question on the basis of my rights 
under the Fifth Amendment of the Constitution of the United 
States. 

Q Mr. Hakim, do you have an interest in a company 
called Lake Resources? 

A On the advice of counsel, I must respectfully 
decline to answer that question on the basis of my rights 
under the Fifth Amendment to the Constitution of the United 
States. 

Q Mr. Hakim, do you have an interest in any of the 
following companies: Energy Resources; Hyde Park Square; 
Gulf Marketing Consultants; Dolmy Business; U^all.r Albon 



11 MlllCllUlUCll U U*-* Ulic ^vW110I.J. 

UNCLASSIFIED 



13 



mmm 



1 Values; or ToyCo. 

2 A On the advice of counsel, I must respectfully 

3 decline to answer that question on the basis of my rights 

4 under the Fifth Amendment to the Constitution of the United 

5 States 

6 Q Do you know whether any banking records of these 

7 companies exist other than in the possession of a bank? 

8 A On the advice of counsel, I must respectfully 

9 decline to answer that question on the basis of my rights 
'0 under the Fifth Amendment to the Constitution of the United 

11 States 

12 Q Do you have access to any records relating to 
monies contributed for the purpose of aiding anti-government 

1* forces in Nicaragua? 

1^ A On the advice of counsel, I must respectfully 
^" decline to answer that question on the basis of my rights 
^^ under the Fifth Amendment to the Constitution of the United 

States 

Q Do you have access to any records relating to the 

proceeds from sales of arms by the United States to Iran 
*' A On the advice of counsel, I must respectfully declin€| 

to answer that question on the basis of my rights under the 

Fifth Amendment to the Constitution of the United States. 

Q Can you identify any bank accounts into which such 

monies were put either directly or indirectly? 



Dut either directly or ind 

^ikiPi ACOinrn 



23 
24 
2S 



liNCUSSW 




1 A On the advice of counsel, I must respectfully 

2 decline to answer that question on the basis of my rights 

3 under the Fifth Amendment to the Constitution of the United 

4 States. 

5 MR. NIELDS: At this time, I would request that 

6 the presiding officer of this deposition communicate to the 

7 witness an order of immunity issued pursuant to Title XVIII 

8 United States Code Section 6000 and sections following 6001 

9 so that we may obtain answers to these questions. 

10 MR. CHENEY: Mr. Hakim, I am hereby communicating 

11 to you an order issued by the United States District Court 

12 for the District of Columbia, at the request of the House 

13 Select Committee to Investigate Covert Arms Transactions 

'* with Iran, providing that you may not refuse to provide any 
15 evidence to this committee on the basis of your privelege 
against self-incrimination, and providing furthe:r that no 
evidence or other information obtained under the order — or 
any information directly or indirectly derived from such 
evidence — may be used against you in any criminal 



^^ proceeding 

*^ , J, therefore, direct you to answer the questions 

22 



UNCLASSIFIED 



put to you. 

MR. NIELDS: At this "time , T "would like to mark 
as deposition Exhibit No. 3 the order which the -- 
Mr. Cheney, the presiding officer, has just communicated to 



10 



15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



UNCLASSIRED 



1 the witness. 

2 MR. JANIS: Congressman Cheney, I am instructing 

3 my client to continue to refuse to respond to those 

4 questions. 

5 You are seeking to compel Mr. Hakim to testify 

6 as to whether he has an interest in various companies and 

7 control over their banking records, if there are any. 

8 If Mr. Hakim admits an interest in any of those 

9 companies and then admits that he has access to banking or 
other records, this committee will, in turn, use those 
answers to compel him to identify and to produce banking or 

^2 other records 

Thus, Mr. Hakim will not receive protecti 
14 



on 



coextensive with the Fifth Amendment, nor will his Fifth 
Amendment rights be protected unless not only his 
testimony about the records but also the records themselves 
and any information directly or indirectly derived from the 
records are also covered by the immunity order. 

MR. NIELDS: I would request a ruling from the 
Chairman at this time on the objection of Mr. Janis. 

MR. HAMILTON: The order as the immunity statute 
provides not only that Mr. Hakim's testimony may not be used 
against him, but also that any other information directly or 
indirectly derived from his testimony may not be used against 
him. 



ONCUSSIFIFO 



11 



23 
24 
26 



yNCLASSIFIED 



10 



1 Other information is defined in the statute, 

2 Section 6001(2), to include any book, paper, document, record 

3 or other material. The immunity order, therefore, applies 

4 not only to his testimony but also to any documents, 

5 including banking records which he discloses through his 

6 testimony or admits are in existence and under his control 

7 and which the committee directs him to produce as a result. 

8 Since no direct or indirect use may be made in any 

9 criminal case of Mr. Hakim's testimony or the banking or other 

10 records derived from the testimony given under the direction 

11 of the committee, nor may any use be made of the records 

12 themselves or of any information derived directly or 

13 indirectly from the records themselves, pursuant to the 

I* authority vested in ag by the Committee Rule 7.4, I direct 

'5 Mr. Hakim to answer the questions put to him at this 

'8 hearing. 

17 MR. NIELDS: I would ask that the presiding 

1^ officer of the hearing being conducted by the Senate 

1® Committee — that is Senator McClure — likewise communicate 

20 to the witness an order of immunity issued under Title XVIII, 

21 Section 6001 and sections following. 

22 SENATOR MCCLURE: I, James A. McClure, have been 



designated by Chairman Daniel K. Inouye to serve as acting 
chairman for this executive session. |t» 

I concur in Chairman Hamilton' s IruIing^mTd'e" 




12 



22 
23 



25 



uNcuiSsra 



li 



1 behalf of the House Committee. 

2 On behalf of the Senate Select Committee, I also 

3 direct Albert Hakim to answer the questions put to him at 

4 this hearing. 

5 MR. NIELDS: The Chairman of the Senate Committee 

6 is also on the speaker phone, and I would ask whether he also 

7 concurs in that ruling. I 

8 SENATOR INOUYE: This is Senator Inouye speaking 

9 to you from Washington. I likewise communicate to you an 

10 order issued by the United States District Court for the 

11 District of Columbia at the request of the Senate Select 
Committee on Secret Military Assistance to Iran and the 
Nicaraguan Opposition, providing for use and derivative 

1* use immunity for Mr. Hakim. 

15 On behalf of the Senate Select Committee, I concur 

with Chairman Hamilton's ruling on your objection and the 

reason he cites for his ruling. I 

MR. JANIS: On the basis of the committees' rulings, 

I am constrained to instruct my client to respond to the 

committees' questions. 



^' MR. NIELDS: We will pause briefly while the House 



inununity order is marked Exhibit 3, the Senate immunity 
order is marked Exhibit 4, and a letter designating 



* Senator McClure as acting chairman is marked Exhibit 5. 



UN[)iA<i<;rHrn 



13 



18 
19 
20 
21 
22 
23 
24 
25 



UNCIMSIFIED 



12 



1 (Exhibit Nos. 3, 4, and 5 were 

2 marked for identification.) 

3 BY MR. NIELDS: 

4 Q The exhibits have been marked. 

5 Mr. Hakim, do you have any knowledge about the 

6 source of funds raised for the purpose of aiding anti- 

7 government forces in Nicaragua? 

8 A Yes. 

9 Q Do you have any knowledge about the disbursement of 
10 those funds on behalf of the anti-government forces in 

'1 Nicaragua? 

A Yes. 

Q Do you have any knowledge about the receipt of 
proceeds of the sale of TOWs and Hawk spare parts to Iran? 
A Yes. 
Q Do you have any knowledge about the expenditure 



1' of proceeds of the sale of TOWs and Hawk spare parts to Iran? 



A Yes. 

Q Do you have any knowledge about the expenditure 
of funds with regard to efforts to re-establish relations 
between the United States and Iran and to obtain the release 
of United States hostages in Lebanon? 

A Yes. 

Q With respect to the soufce'of TuT!3s raised for the 
purpose of aiding anti-goVernment forces in Nicaragua, 




14 



UNCIASSIHED 



13 



1 do you have specific knowledge of bank deposits? 

2 A Yes. 

3 Q With respect to the disbursement of money raised 

4 for the purpose of aiding anti-government forces in Nicaragua, 

5 do you have specific knowledge of bank disbursements? 

6 A Yes. 

7 Q With respect to the receipt of proceeds of the 

8 sale of TOWs and Hawk spare parts to Iran, do you have 

9 specific knowledge of bank deposits? 
A Yes. 
Q With respect to the receipt of proceeds of the sale 

of TOWs and Hawk spare parts to Iran, do you have specific 
^3 knowledge of bank disbursements? 



A Yes. 

Q With respect to efforts to re-establish relations 
between the United States and Iran and to obtain the release 



14 
15 
16 

of U.S. hostages in Lebanon, do you have sp^acific knowledge of 

Ifi 

bank disbursements? 

A Yes. 

Q Can you tell us about specific deposits of which 
you are aware that were made for the purpose of aiding anti- 
government forces in Nicaragua or as proceeds of the sale of 
TOWs and Hawk spare parts to Iran? 

A Yes 

Q Would you please do so? 



ICLASSIFIED 



15 



UNCLASSIFIED 



14 



1 A The following deposits were made on or about the 

2 following dates: 21st December 1984, Bank American 

3 International, New York, $425,000 — this amount is from 

4 Bank of America International New York, 7/1/85, from 

5 A.-nerican Express, Miami — January 7, 1985, from American 

6 Express, Miami, $96,450 — that is dollars; January 16, 

7 1985, American Express, New York, $337,000; January 17, 1985, 

8 S3S, Zurich, $326,545; January 29, 1985, American Express, 

9 Miami, $138,000; March 5, 1985, Barclay's Bank, Miami, 

10 $1,200,000; on or about March 14, 1985, Barclay's Bank, 

11 Miami, $500,000; 29th of March, 1985, Barclay's Bank, Geneva, 

12 S3 million; April 23, 1985, Barclay's Bank, Miami, $1,200,000; 

13 May 2, 1985, Barclay's Bank, Geneva, order Mr. — I spell it 

14 D-U-C-0-M-M-U-N — $246,600; April ~ May 21, 1985, Barclay's 
IB Bank, Miami, $80,243; May 31, Barclay's Bank, Miami, 

16 $300,000; July 5, 1985, Barclay's Bank, Miami, $550,000; 

17 July 18, 1985, SBS Geneva, $950,000; and on September 20, 1985 

18 from order Sam Loew/Manufacturers Hanover Trust, New York, 

19 $1 million; September 23, 1985, I believe, from National Bank, 

20 Washington, firm IBS, International — IBC, sorry -- IBC 

21 International Business Communication, $130,000; October 11, 

22 I.e., Inc. — that is 1985 — I.C., Inc., Barclay's Bank, 

23 Geneva, $100,000; November 4, 1985, I believe, from IBC 

24 Barclay's Bank through IBC — through I.C.-- that is I.e., 

25 Inc., the one I.iBenfiQned before -- $150,000; November 18, 



.Mentioned before -- $15 

ii.ilMlMirirn 



16 



UNCLASSIFIED 



15 



1 1985, IC, Inc., Barclay's Bank, Geneva, $48,000; November 20, 

2 1985, there is a payment which I believe is related to the 

3 TOWs through Israel, Credit Suisse, Geneva, $1 million. 

4 Q Could that be Hawks through Israel? 

5 A Possible, possible. 

6 Q Okay. 

7 A December 17, 1985, IBC through UBS, Zurich, from — 

8 the amount is $300,000. I believe it could probably be from 

9 IBC, and I mentioned that it was from UBS, Zurich. 

10 Now, January 10, 1986, again, I believe, IBC 

11 through National Bank, Washington, and UBS, Zurich, $60,000; 

12 January 22, 1986, again, I believe, from IBC Barclay's 

13 Bank, Georgetown, probably through I.e., $360,000; on 

14 February 7, 1986, I believe, from Mr. Khashoggi, a check 

16 through BCCI Monte Carlo, $2,500,000; on February 10, 1986, 

16 again, I believe, from Mr. Khashoggi, a check from Chase 

17 New York for $2,500,000; February 18, again, I believe, 

18 Mr. Khashoggi, two checks — that is 1986, again — two 

19 checks BCCI, $5 million; on February 18, 1986, order of 

20 Sam Loew/Manufacturers Hanover Trust, New York, $1 million. 

21 On May 14, 1986, I believe Mr. Khashoggi again, 

22 order Trivert — T-R-I-V-E-R-T — International/Credit Suisse, 

23 510 million; on May 15, 1986, Discount Bank and Trust, 

24 Geneva, $225,000; May 16, 1986, I believe, again, 

26 Mr. Khashoggi, order Garnet — G-A-R-N-E-T — overseas, 

IIMPI ACe/nrn 



17 



uNtmsro 



16 



t check BCCI, Paris, $5 million; May 18, 1986, Discount 

2 Bank and Trust, Geneva, $1,460,000; on September 24, 1986, 

3 order Overseas Trading Consultant, Ltd., UBS, Zurich, 

4 $1,200,000; on October 29, 1986 — this was directly from the 

5 Iranians -- a check -- this is the — what is referred to as 

6 the second channel, the check on Deutsch Bank, Frankfurt, 

7 for $3,600,000. 

8 And there are other payments on April 10, 1985 from 
g Barclay's Bank, Miami, order Mr. D-U-C-0-M-M-U-N $2 million; 

10 on April 15, 1986, I believe it is IBC from I.C., Inc., 

11 Barclay's Bank, New York, $649,852; this August 21, 1985 from 

12 Colorado National Bank, Denver, order Joseph or Holly Coors, 

13 $65,000; on September 3, 1985, from Credit Suisse, New York, 

14 order STE General Strauss Turnbull — T-U-R-N-B-U-L-L — 

16 I believe it is a London bank — $2,400; on October 23, 1986, 

16 from Canadian Imperial Bank, Geneva — 

17 Q 1986 or 1985? 

18 A 1986. 

19 This is from Canadian Imperial Bank, Geneva, 

20 Rainbow Star — no. Star Licensing S.A., $2,525. 

21 All these total up to $47,726,015, and there is also 

22 an accumulation of interest which totals to $260,585, and the 

23 total of deposits plus interest is $47,963,200, approximately. 

24 The press has reported that on or about August 19 

25 or 20, 1986, the Sultan of Brunei deposited $10 million for 



18 



*IHS«B 



17 



1 the benefit of the contras. 

2 Although I was told that a deposit of such an 

3 amount would be made without identifying the source, and 

4 although our planning was made on the understanding that such 

5 a deposit would be forthcoming, and although I continued 

6 to inquire about the deposit and was told it would be coming, 

7 no such monies were ever received so far as I am aware, and 

8 I have no knowledge about the disposition of any such fundr,. I 

9 Q Mr. Hakim, can you tell us about specific payments 

10 made on behalf of anti-government forces in Nicaragua 

11 or with respect to the sale of TOWs and Hawk spare parts 

12 to Iran or with respect to efforts to re-establish relations 

13 between the United States and Iran and to guarantee release of 

14 U.S. hostages in Lebanon? 
16 A Yes. 

16 Q Would you please do so in a summary form and maybe 

17 some examples? 

18 A To the best of my ability to reconstruct the 

19 transactions which were complicated and done in order to try 

20 to adhere to the instructions I received to try to maintain 

21 operational secrecy, approximately $40,190,000 was disbursed 

22 or transferred, including disbursements to me — the amount, 

23 I repeat again, is $40,190,000. 

24 MR. CHENEY: 109? 

25 THE WITNESS: Yes. 



UNCLASSIFIED 



19 



Kussm 



18 



BY MR. NIELDS: 
Q Okay. 

A Was disbursed or transferred. That includes 
disbursements to me or paid in bank fees. 

In addition, approximately $1,236,000 remains in 
bank accounts, and approximately $6,527,000 is currently on 
deposit on my behalf with a Swiss fiduciary. 

By way of example, after sorting through these 
complicated transactions, my best analysis is that, one, 
$12,237,000 was disbursed to account number 

which I believe is or was an account maintained 
in Switzerland by the U.S. Central Intelligence Agency. 
Two, $11,234,598 was disbursed to account 

number ^^^^^^^Vat SBS Geneva, which I believe to be an accoun 

u 
maintained by a Portugese arms supplier, Defex, 

Three, $3,264,596 was — 

Q Would you repeat that number? 

A $3,264,596 was disbursed to Southern Air 

Transport and another $1,540,325 was disbursed to 

Amalgamated Commercial Enterprises at Banco de Iberoamerica, 

Panama, and I believe ACE may be a related company to the 

Air Transport operation. 

Four, $1,579,481 was'(?fs'Surs?'d"^to" Transfer Id Arms, 

Limited, a Canadian firm, at the Royal Bank of Canada. 

Five, $657,304 was paid to EAST, Inc. 



20 



.S^7 



uNcussire 



19 



1 

2 

3 

4 

5 

6 

7 

8 

9 
10 
11 
12 
13 
14 
16 
16 
17 
18 
19 
20 
21 
22 
23 
24 
28 



Six million, four hundred ninety-two thousand, six 
hundred and seventy dollars was paid to Captain Arne -- 
A-R-N-E — his last name H-E-R-U-P, captain of the ship 
Erria. 

Seven, an additional $117,176 was paid to S.A. 
Chartering APS regarding the same ship, Erria, and 110,318 
Deutsch marks to Martins Morner and Co., Limited at Midland 
Bank, London, for insurance on the Erria. 

Eight, $226,998 was paid to Arrow Leasing S.A., 
Geneva. 

In addition, by the way, there is an outstanding 
unpaid invoice from Arrow Leasing for the lease of the plane 
used in flying hostage David Jacobsen out of Beirut or 
Cyprus. That invoice is still outstanding, unpaid. 

was ^° ^^^^^^^^^^^^^B ^^ 
Barclay's Bank in Miami, which I believe represents 
payments to the Nicaraguan Democratic Force. 
Ten, $127,7 00 was paid to 

la CIA proprietary company that was 
chartered in November 198 5 to deliver Hawks to Iran. 
Eleven, $59,500 was paid tc 




21 



UNCUSsra 



20 



1 Q What is the basis for your specific knowledge of 

2 these deposits and disbursements? 

3 A I made available to individuals involved in the 

4 projects you have described a system of companies and 

5 organizations, and I participated in the management and 

6 operation of that system for which I authorized disbursements 

7 of funds. 

8 Q Would you please identify all of those companies? 
^ A Lake Resources, Inc.; ToyCo S.A.; Dolmy Business, 

Inc.; Udall Research, Inc.; Albon Values Corporation; Hyde 
Park Square Corp.; Gulf Marketing Consultants, Limited; and 
Engineering Resources International S.A.; and other companies. 

Q Do you have access to any banking records relating 
'* to monies raised for the purpose of aiding anti-government 

forces in Nicaragua? 
^® A Yes. 

Q Do you have access to banking records relating 
to the proceeds of sales of arms to Iran? 

A Yes. 

Q Do you have access to any banking records relating 
to efforts to re-establish relations between the United 
States and Iran and to gain the release of U.S. hostages in 
Lebanon? 

A Yes. 



llNtlfcSSW 

Do you have access to other records necessary to 



22 



21 



DNWSSW 



21 



1 trace the control and flow of funds relating to monies 

2 raised for the purpose of aiding anti-government forces in 

3 Nicaragua with respect to the proceeds of sales of arms to 

4 Iran and with respect to efforts to re-establish relations 

5 between the United States and Iran and to gain the release 

6 of U.S. hostages in Lebanon? 

7 A Yes. 

8 Q Would these records also serve to corroborate 

9 your earlier testimony regarding deposits and disbursements? 

10 A Yes. 

11 Q Do any of the banking or other records you have 

12 just acknowledged exist other than in possession of a bank? 

13 A Yes. 

14 Q What records to which you have access and which 

16 would relate to and corroborate for us your testimony and to 

16 help us trace the control and flow of funds? Please be 

17 specific, including the name of any bank accounts, the account 

18 numbers, and the identity of the banks at which the accounts 

19 were or are maintained. 

20 A I believe that the following records would all be 
necessary: (a) corporate organization papers, board of 



22 director minutes of meetings, and other correspondence and 

23 business records of, one, Sci Tech Trading Group, S-C-I 

24 x-E-C-H, Trading Group, Inc; two, ''yrf'*'"^ S.A., and I must 

25 point out this is not the same company in Portugal that was 

liiiAi Aooirirn 



23 



23 



25 



immiB 



22 



1 paid for arms. This name was used to create confusion. 

2 Three, Stanford Technology Corporation S.A., 

3 Panama; four, Stanford Technology Corporation Services S.A., 

4 Fribourg. 

5 Q Go slower. 

6 A Okay. 

7 Q The last was Stanford Technology? 

8 A Corporation Services S.A., Pre«l3urg, Switzerland. 

9 Q Continue. 

10 A Five, Albon Value Corporation; six, Dolmy Business, 

11 Inc.; seven. Energy Resources International S.A.; eight, 

12 Gulf Marketing Consultants, Limited; nine, Hyde Park Square 
^3 Corporation; ten. Lake Resources, Inc.; eleven, Stantech 

Services S.A.; twelve, ToyCo S.A.; thirteen, Udall Research 
Corporation; fourteen, Korel Assets, Inc. 

(B) , bank accounts at Credit Suisse Bank, Geneva 



of, one. Lake Resources, Inc., account number 386430; two, 

ToyCo S.A., account number 642804; three, Beaw Business, 

Inc., account number 207225; four, Udall Research, Inc., 

account number 649853^ five, Albon Value Corporation, 

account number 108277; six, Hyde Park Square Corporation, 

account number 339825; seven, Gulf Marketing Consultants, 



Limited, account number 311225; eight. Energy Resources 



^* International S.A., account number 230774; nine, Stantech 



Services S.A., account number 618349; ten, and the bank 
IlilAI iA#%ii-i»>>^ 



24 



15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



UNCUSSIFIED 



23 



1 statements, debit and credit advices, records of transactions, 

2 and deposits and transfers, signature cards, corporate 

3 papers, and other bank forms and account records for each of 

4 those accounts. 

5 (C) , bank statements, debit and credit advices, 

6 record and transactions and deposits — it is records of 

7 transactions and deposits and transfers, signature cards, 

8 corporate papers and other bank forms and accounts -- account 

9 records for the following accounts at other banks. 

10 One, account number / CO-268395 of Energy Resources 
^' International S.A. at Societe de Banc Suisse, Geneva. That 

12 is SBS. 

13 Two, account number 2052659 of Stanford 
1* Technology Corporation Services S.A., Fr«etesrg, at Trade 



Development Bank, Geneva. 

Three, account number 300518 of Defex S.A. at the 
Union de Banc Suisse in F-r ea bur g ; (d) , records prepared and 
compiled for me by a Swiss fiduciary company, Compagnie 
de Services Fiduciaries, CSF, at my request and in response 
to my inquiries, including, one, invoices from CSF; two, 
invoices from vendors and suppliers; three, transaction 
records with Audifi, S.A., FitiulnJlg; four, correspondence; 
five, handwritten notes and memos; six, receipts; seven, 
annotations and internal records regarding banking trans- 
actions; eight, telexes and payment orders; nine,^,. 

IlilAI A#%J»I>>1VM 



1 



25 




24 



^ reconciliations; ten, debit and credit advices; eleven, 

2 internal analysis and summaries prepared for me by CSF 

3 regarding transactions undertaken by CSF with the accounts 

4 I have previously identified and at other accounts maintained 

5 by CSF for itself and its customers; twelve, certain records 

6 of the Republic National Bank, New York; thirteen, records and 

7 analysis of accounts from and portfolios with CSF Investment, 

8 Limited, Bermuda; fourteen, computer-generated summaries 

9 and accountings and ledgers; fifteen, other related documents. 

10 (E) , records of Dolmy Business, Inc., relating to 

11 the ship Erria, including, one, summary of the account; two, 

12 invoices; three, correspondence; four, employment agreements; 

13 five, purchase documents; six, registration documents; 

14 seven, other records. 

16 Q Mr. Hakim, if the committee were to serve you with 

16 a subpoena for the records that you have just described, 

17 could you produce them? 

18 A Yes. 

19 Q with the exception of certain records held under 

20 seal in Switzerland, which I have discussed separately 

21 with your lawyer, are the records that you just described all 

22 of the records to which you have access that relate to the 

23 receipt or disbursement of funds relating to the sale of 

24 TOWS and Hawks to Iran, to the pursuing of the initiative of 

25 the United States towards Iran, and to the raising of an 

iiiiAi lAAirirrk 



26 



UNCLASSIFIED 



25 



' expenditure of monies to support the anti-government forces 

2 in Nicaragua? 

3 MR. JANIS: May we have just a moment? 

4 MR. NIELDS: Yes. 

5 MR. JANIS: Mr. Nields, we are prepared to answer th« 

6 question. 

1 THE WITNESS: Yes, to the best of my knowledge, 

^ although it is possible that further analysis of the records 
^ I have identified might lead to some additional records. 

MR. NIELDS: Thank you. 

At this time, I would request the chairmen of the 
two committees, as well as the two presiding officers at 
this deposition and hearing, to direct Mr. Hakim to produce 
within 24 hours to representatives of this committee, these 
committees, the records which you have just described. 

Can the chairmen even kese me? 

MR. HAMILTON: I can hear you. 

SENATOR INOUYE: Yes, 1 am here. 

MR. NIELDS: I would request first that the 
chairmen direct Mr. Hakim to produce to representatives of 
these two committees within 24 hours the records which he has 
just described. 

MR. HAMILTON: Mr. Hakim, we would so direct you. 

SENATOR INOUYE: I concur.! 

MR. NIELDS: I would also ask the presiding officers 



we wouia so airect you. 

UNCLASSIFIED 



27 



uNcmssra 



26 



1 at this deposition and hearing to do likewise. 

2 MR. CHENEY: Mr. Hakim, speaking for the House, 

3 I concur. 

* MR. MCCLURE: Mr. Hakim, speaking for the Senate 

5 hearing, I concur in that direction. 

6 MR. JANIS: Mr. Nields, I take it you are going to 
^ also issue subpoenas for these records that will be served in 
8 the United States? 

MR. NIELDS: That is correct. They will be 
served pursuant to Mr. Hakim's and your consent on Janis, 
Schuelke & Wechsler in the United States. 

MR. JANIS: Based upon the directives of the 
committee chairmen and the presiding officers present here 
at this deposition and hearing, and based upon the service of 
subpoenas to Mr. Hakim, he will comply with the directives and 
the subpoenas. 

MR. NIELDS: And will Janis, Schuelke & Wechsler 
accept service on Mr. Hakim's behalf of subpoenas for these 
records in the United States? 

MR. JANIS: Yes. 

That is obviously — I think it is clear that the 
only subpoenas which we are authorized to accept are the 
subpoenas specifically identified in this proceeding and not 
any others. 

MR. NIELDS: At this time, I propose th£.t we adjourn 



xy xucii ux J. j.eu xii t-iixa t'x^. 

UNCLASSIFIED 



28 



4 

5 

6 

7 

8 

9 
10 
11 
12 
13 
14 
IB 
16 
17 
18 
19 
20 
21 
22 
23 
24 
2B 



27 



' this deposition and hearing and permit the two Chairs to go 

^ back to their other responsibilities and proceed to the task 
3 



of obtaining the records and serving the subpoenas. j 

MR. JANIS: I concur. 

MR. NIELDS: Chairmen, thank you very much. I am 
sorry I imposed so much on your time. I think we can 
terminate the conference call. 

MR. HAMILTON: Thank you very much. 

SENATOR INOUYE: Thank you very much. 

(Discussion off the record.) 

MR. NIELDS: I would like to mark two subpoenas 
duces tecum addressed to Albert Hakim as deposition Exhibits 
6 and 7 . 

(Exhibit Nos. 6 and 7 were marked 
for identification.) 

MR. NIELDS: The record should reflect that 
Deposition Exhibit 6 is a subpoena duces tecum addressed to 
Albert Hakim from the House Select Committee. 

Deposition Exhibit 7 is a subpoena duces tecum 
addressed to Albert Hakim from the Senate Select Committee. 

They direct Mr. Hakim to produce the identical 
documents that he has earlier identified in his testimony and 
which he has earlier been directed to produce by the Chairs 
of each committee. 

These subpoenas or copies of them are simultaneously 



sell uxxt;L;teu uu ^Jitjuu^-c u 

ONCLASSinED 



29 



20 
21 
22 
23 
24 
25 



UNCIASSIRED 



28 



^ being served on the law firm of Janis, Schuelke & Wechsler in 
2 the United States by telefax, and I think the record should 
^ reflect that Mr. Hakim has just now produced seven binders 
* of documents which constitute the documents responsive to 
5 the subpoenas and to the earlier direction of the Chairs; is 
® that correct, Mr. Hakim? 

^ MR. JANIS: Excuse me. He is not producing. Once 

® you hand us the subpoenas, he will then produce. 
MR. NIELDS: Off the record. 
(Discussion off the record.) 

MR. JANIS: Based upon my understanding that the 
subpoena which is now being served on us here today is also -- 
has also been simultaneously sent to my offices in Washington 
for acceptance of service, Mr. Hakim is now producing the 
records. He will hand them to you, Mr. Nields. 
MR. NIELDS: Thank you. 
" The record should reflect that Mr. Hakim has just 

handed me a bag containing seven binders of documents, and 

19 

I will ask Mr. Hakim whether those are all the documents called 

for by the subpoenas and by the Chairs' earlier orders. 

THE WITNESS: It is in accordance with my 
testimony, yes. 

MR. NIELDS: Thank you. 

I thank you all. 



UNCLASSIFIED 



30 



29 




1 (Whereupon, at 12:05 p.m., the joint hearing was 

2 adjourned. ) 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
26 



t 



UNCLASSIFIED 



31 



UNCLASSIFIED 



1 
2 

3 

4 I DEPOSITION OF ALBERT HAKIM 

S 

6 I Friday, May 22, 1987 

7 

8 I U.S. House of Representatives, 

g Select Committee to Investigate Covert 

10 Arras Transactions with Iran, 

11 Washington, D.C. 
12 

13 I The Committee met, pursuant to call, at 10:00 a.m., 

14 in Room H-128, the Capitol, with John Nields presiding. 

15 On behalf of the House Select Committee: John 

16 Nields, George Van Cleve, John Fletcher, Joseph Saba, 

17 Robert Brink, Ronald Points, xJiCi\o|4s ^,sQ_. 

18 On behalf of the Senate Select Committee: Arthur Liman, 

19 Cameron H. Holmes, Timothy Woodcock, Louis Zanardi, David 

20 Faulkner, Miuihula ^Wliji'^ Paul Barbadoro, John Monsky. 
21 
22 Wechsler, and Clement R. Gagne, III; Janis, Schuelke & Wechsler 




On behalf of the Witness: N. Richard Jani#s, Lawrence H. 



23 1728 Massachusetts Avenue, N.W. , Washington, D.C. 20036. 

Partially Deciassihea/Released nn 11 JAN 8 8 



miAssra 



under provisions of E 12356 
by K Jonnson. National Sacurily Council 



32 



Whereupon, 



UNCUSSIHED 



ALBERT HAKIM 



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 



having been first duly sworn, was called as a witness herein, 
and was examined and testified as follows: 

MR. NIELDS: Let's come to order so the members 
who are here can leave. 

EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 

BY MR. NIELDS: 
Q Would you state your name and spell it for the 
record, please? 

A Albert Hakim, A-L-B-E-R-T H-A-K-I-M. 
Q Mr. Hakim, did there come a time in the last 
couple of years when you became involved in the sales of 
U.S. military equipment to Iran? 

MR. JANIS: Mr. Nields, I take it that any 
questions being propounded to Mr. Hakim and any answers 
he gives are going to be covered by the immunity orders 
previously conferred in Paris on April 20? 

MR. NIELDS: In fact if he asserts his previous 
privilege, which I anticipate he will. Chairman Rodino 
will communicate the immunity order to him right now. 

THE WITNESS: On the advice of counsel, I 
must respectfully decline to answer that question on the 
basis of my rights under the Fifth Amendment to the 
Constitution of the United States. 

MR. RODINO: Mr. Hakim, I cim hereby communicating 
to you an order issued to the House Select Committee by 



33 



liNcussm 



1 the U.S. District Court for the District of Columbia. The 

2 order provides in substance that you may not refuse to 

3 provide evidence on the basis of your privilege against 

4 self-incrimination. It provides that evidence obtained 

5 from you under the order may not be used against you in 

6 any criminal proceeding. 

7 A copy of the order is at the witness table. 

8 Pursuant to the order, I direct you to answer the questions 

9 put to you. 

10 MR. RUDMAN: (by telephone) Good morning, 

11 Mr. Hakim. This is Senator Rudman, Vice Chairman of the 

12 Senate Committee. I have in front of me an order issued 

13 by the U.S. District Court of the District of Columbia 

14 directing you to tell your testimony on the basis of 

15 limited immunity. It is very similar, if not identical, 

16 to the House order. 

17 Are you familiar with that order? 

18 THE WITNESS: I am familiar with the House 

19 order, but I don't know the difference between — 

20 MR. RUDMAN: Shall I read the order to you? 

21 THE WITNESS: I have a copy in front of me, sir. 

22 MR. RUDMAN: You have a copy of the Senate Order 

23 in front of you? 

24 THE WITNESS: That is correct. 

25 MR. RUDMAN: Do you understand that order is the 



34 



UNCUSSIHED 



1 same as the House order in that it compels you to testify 

2 on behalf of the Senate and the House? 

3 THE WITNESS: I understand that, sir. 

4 MR. RUDMAN: Then I hereby direct you to answer 

5 all questions that may be put to you by counsel for the 

6 House and the Senate. Are you prepared to do that? 

7 THE WITNESS: I am prepared to do that, sir. 

8 MR. JANIS: Mr. Nields , just SO I can be 

9 satisfied with the record, may I ask that the court reporter 

10 read back so I can here what Senator Rudman said? 

11 MR. NIELDS: Yes, you may. 

12 (The record was read by the reporter.) 

13 MR. JANIS: On the basis of the immunity orders 

14 previously entered in this case and communicated on 

15 April 20, 1987, and communicated again this morning, my 

16 client — I am instructing my client that he is compelled 

17 to answer any qw oc tinc placed to him except questions 

18 for which we believe a valued privilege is applicable and 

19 if that happens I will assert such a privilege. 

20 You are now compelled to answer the questions 

21 pursuant to the grants of immunity. 

22 MR. NIELDS: I think I should state for the 

23 record that this is a joint or simultaneous proceeding, 

24 both a House Select Committee proceeding and a Senate 

25 Select proceeding, and there are representatives of both 



35 



BNCUSSra 



1 committees present, and immunity orders on behalf of 

2 both coraraittees have just been coraraunicated. 

3 BY MR. NIELDS: 

4 Q Mr. Hakim, I think I asked you prior to the 

5 communication of the immunity orders whether there had 

6 come a time in the last couple of years when you had 

7 become involved in the transfer of U.S. military equipment 

8 to Iran. I take it the answer to that is yes. 

9 A That is correct, sir. 

10 Q Before we get into the details of that, I would 

11 like to ask you some just background questions about 

12 yourself. Could you tell us where you were born? 

13 A I was born in Tehran, Iran. 

14 Q When was that? 

15 A It was July — the 16th of July 1936. 

16 Q How long did you live in Iran? 

17 A Well, except the period that I spent in the U.S. 

18 going to school, I lived most of my life in Iran, and there 

19 was a period that I resided in Europe, just outside of 

20 Geneva. So I lived most of my life in Iran. 

21 Q Now I take it you lived most of your life in 

22 Iran up until a particular point in time? 

23 A There were two periods that my stay in Iran 

24 was not on a continued basis. One was, I believe, some 

25 time in 1974-75 when I started to reside in France outside 



-75 when I started to res 

imm AOOintn 



36 



UNCLASSIFIED 



1 of Geneva at the border, where I owned a house and my kids 

2 were going to school there in Switzerland, and I had my 

3 place of business in Geneva. And then also the time came 

4 after the Iranian revolution that I moved to -- from 

5 actually — from France for personal rea:.ons I moved to the 

6 U.S. , not because of the revolution — I had marital problems 

7 and I moved to the U.S. to be close to the rest of my 

8 family. 

9 Q Perhaps you could just give us a brief description 

10 of your education and after that I will ask you a little 

11 bit about your occupation. 

12 A I had most of my primary and high school 

13 education in Tehran, Iran. The last year of high school 

14 I attended the senior year of my high school in San Luis 

15 Obispo, and two or three years at the University of 

16 California State Polytechnic College in electronics. 

17 I returned to Iran during the time that the 

18 Prime Minister of Iran the. Or. Amini, was as he put it, 

19 tightening the belt of the country because of the financial 

20 problems, and I was the so-called government foreign exchange 

21 I was benefitting from a reduced rate of exchange because of 

22 the tests that I took and passed. So they stopped that, 

23 and as a result of that I returned to Tehran. 

24 Q In other words , you interrupted your education 

25 in the U.S. because of this financial situation that you 

' ■iftiAi iAAirirn 



37 



UNCUSSIFIED 



1 just described? 

2 A That is correct, sir. 

3 Q Did you continue your education in Tehran after 

4 that? 

5 A No. I started with my professional life. I 

6 worked with my father in general trading and insurance and 

7 real estate for a while, and the opportunity came about, I 

8 believe, around 1963 -- I may be off a year — that I 

9 started to work for an American individual who had an 

10 Iranian company in Tehran engaged in the business of 

11 electronics and I started to work in that organization. 

12 That organization's name was Telecom Limited. 

13 And there came a time that I grew in the company to become 

14 the general manager of the organization, and also owned 25 

15 percent of the company. 

16 During the time of negotiating the transfer of 

17 the stock for that percentage, we did not reach a final 

18 agreement with the owner then, and that is when I separated 

19 from Telecom Limited and started my own company, Multicorp 

20 International. 

21 Q Multicorp? 

22 A Yes, two words. 

23 Q Before you go on to that, who was the -- you men- 

24 tioned a U.S. citizen who was the principal of Telecom. 

25 A That is correct. 



\m rap?^n 



38 



miASsm 



Q Who was that? 

A Moshe Bassin, B-A-S-S-I-N. 

Q When did you cease to be associated with 
Telecom, approximately what year? 

A I believe in 1971-72, about then. 

Q Had you started in 1963? 

A Working with that company, that is correct. 

Q You said it was in the electronics business. 
Does that mean it was in the business of selling electronic 
equipment? 

A That also. In that company, basically, we were 
representative of a number of American companies in 
Iran for sales distribution and post sales maintenance of 
those equipments . 

Q So that you represented a nimiber of different 
electronic manufacturers in the U.S.? 

A That is correct. In Iran, but they were 
American firms. 

Q I understand. Did Telecom have any other 
business besides representing American manufacturers 
of electronic equipment? 

A As I mentioned, we did maintenance work. We had 
some engineering capability — limited, but we did have 
some engineering capability. 



2' Q Anything else? 



UNCLASSIFIED 



39 



UNCLASSIFIED 



1 A Not that I was aware of. It was wholly owned by 

2 Mr. Bassin. 

3 Q Were the companies — I take it you represented 

4 these American companies in connection with sales to 

5 purchasers in Iran? 

6 A That is correct. The way it worked out we had — 

7 we were commissioned agents. I really don't distinguish 

8 between agent and representative in this business. We 

9 were representatives for those companies, agents, if you 

10 will, and we had a commission coming to us. The companies 

11 collected what was coming to them and the balance was the 

12 income of our company. 

13 Q And were the sales to government agencies, private 

14 organizations or both? 

15 A I should explain to you that the concentration 

16 of my business throughout my professional career has been 

17 focused on governments being my main clients, for two 

18 reasons; one is because of the nature of the products that 

19 I dealt with, and the other reason was because of the 

20 structure of those e ount i ros , that I dealt with. 

21 At first in Iran, being a form of a monarchy 

22 then, almost everything belonged to the government, so in 

23 one form or another you dealt with the government. But I 

24 dealt also later (jr|j^j^,cqpggr^e^_J:_hat_be longed to the 
government. 



25 



iclissmd 



40 



UNCUSSIFIED 



10 



1 In other words, they were structured as a private 

2 organization, but stockholders were various government 

3 agencies. 

4 Q I don't think I asked you specifically during what 

5 years you were being educated in the U.S. 

g p^ 19 — I believe I ceune to the U.S. in 1955 or 

7 1956 — I believe it was 1956 — and I returned to Tehran, if 

8 I am not mistaken, towards the end of 1959, early 1960. 

9 Q Okay. So I take it it was approximately 1972 

10 that you formed Multicorp? 

11 A About that time. Again I may be off a year. 

12 Q What was the business of Multicorp? 

13 A The business of Multicorp was an expanded form 

14 of Telecom business. By expanded, I mean that the 

15 company was structured differently in the form that it was 

16 from conception meant for Multicorp to effectively act as 

17 a holding company, not in the legal sense, but from an 

18 operational sense. And that is why I chose the name Multicorp, 

19 because it was intended to have a multiple number of 

20 corporations with the intent of creating a group of companies, 

21 each company being active in a separate sector of our 

22 government business. 

23 We expanded — originally in Telecom the 

24 concentration was on communications. We represented, 

25 for instance. Motorola, among other companies, Hewlett-Packard 

I ....Ml lAAirirn 



41 



mms\R 






that manufactured the test equipment. -^f^ I started my 
own company, some of those companies that were with 
Telecom Limited recognized my value and my departure from 
Telecom, and they chose to terminate their relationship 
with Telecom and enter into an agreement with me. 

For instance, Hewlett-Packard did so. 
Q With you means with Multicorp? 
A With Multicorp, yes. And Hewlett-Packard, 
for instance, has a number of disciplines as far as 
products are concerned, and I tried to grow, if you will, 
horizontally and have different modules attending to 
different types of activities, and one of our activities 
concentrated on medical. 

Later on we formed various companies to deal with 
these various activities. We got involved in education, 
heavily involved in that area, vocational training, again 
dealing with the government. I formed a separate company, 
Multicorp International Services, and the idea was to provide 
technical services to our clients. It got to a point that 
Multicorp and the associated companies and affiliated 
companies — in total we had, « believe, a total of 150 
employees, mostly technical. 

We had quite a bit of test equipment. We had 
created in the private sector the only calibration in the 
country, as a matter of fact in the region in that part of 



a matter of fact in tije^r 

■mm AOOICltn 



42 



world. 



UNCLASSIFIED 



12 



Q What is a calibration center? 

A A calibration center is a facility where you 
calibrate the test equipment that are used to test various 
electronics equipment. They need to be calibrated so 
their work would be more precise. So we went through the 
expense of creating such a facility. By the way, 
I understand all those facilities are being used by the 
universities now in Iran. 

It was highly technical. I have for all ray 
professional life been working in the area of high technology, 

Q Just to review what you have just told us about 
Multicorp. I take it one of the things that Multicorp 
did was represent — continue to represent U.S. manufacturers 
of electronic equipment in sales to the government of Iran. 

A As well as Europeans. By this time we had 

grown and we had more than 50, 60 companies that we , 

I 
represented. There were also Europeans in there. 

Q Then you mentioned the medical area. Was that 
also a situation in which you represented manufacturers 
of medical equipment who sold to the government of Iran? 

A The concept that I pursued, Mr. Nields, was to 
create systems capability within Multicorp. I wanted my 
company to get to a point that it would not depend solely 
on earning commissions. I wanted to have substance, more 

iiMpi Accinrn 



43 



MLASSm 



13 



1 than sales in the company. So with regard to the medical 

2 area, we created a capability that we were able to bid and 

3 actually execute turnkey projects in equipping a 

4 complete hospital — not only supplying the equipment, but 

5 designing it ar^d packaging the whole thing from A to Z for 

6 a hospital. 

7 Q Did this involve any manufacturing? 

8 A That part of the systems work I did not concentrate 

9 on creating the manufacturing capability, but in the other 

10 area of mostly communications and what I call the 

11 intelligence collection area, we started to create 

12 manufacturing capability. But with the facilities that 

13 we had, I could not go far in Iran with having that 

14 capability, so that was when I chose to start to manufacture -- 

15 Q What precisely did you manufacture? 

16 A In Tehran? 

17 Q Yes. 

18 A It was -- in systems work you do not manufacture 

19 any one complete unit. You manufacture what we call the 

20 interface equipment that you do not normally find as a 

21 separate emd independent unit. So you try to interface 

22 two pieces of equipment — for instance , to give you an 

23 example, if you wanted to interface a reserve with a tape 

24 recorder, you needed some facilities to interface those. 

25 Those were the kind of things that you tried to manufacture. 



1 



13 
14 
15 
16 
17 



19 



21 
22 
23 
24 



44 



UNCLASSIFIED 



14 



unsuccessfully. 



2 Q Did you say unsuccessfully? 



A That is correct — in Tehran. By this time 
4 I was residing in Europe, and I formed — 

Q Before we get to that, I want to make sure we have 
g just understood the different things that Multicorp did. 

You have mentioned the acting as agent for U.S. manufacturers 



Q of electronic equipment. You have mentioned the similar 
9 capacity with respect to medical equipment, and you have 



I 



said that you also put systems together and packaged them 
and sold them, I take it, as a package to hospitals and 



12 other buyers of medical equipment; am I correct; 



A That is correct. Also in the area of vocational 
training, we did the same type of packaging. 

Q Okay. Vocational training. Who was the 
provider or supplier of the vocational training? 

A Mostly Europeans, French and Italian. They 



1g are quite good in that area. 



Q Was there anything else that Multicorp actually 



20 did while you ran it? 



A That is what I was trying to say about our 
manufacturing capability. Since we did not succeed in having 
the manufacturing capability in Iran, that was when I 
decided to create that capability in the U.S. At the time 



25 I was living in Europe. My business had expanded to cover 

•itiAi Aooiricn 



45 



ONCLASSIFIED 



15 



1 other areas than Iran-France. I had the responsibility 

2 for Hewlett Packard for the Kuwaiti market. So I formed 

3 Stanford Technology Corporation S.A., who purchased the 

4 facilities of a bankrupt company in the U.S. in the 

5 Silicon Valley -- the subsidiary was bankrupt, by the way -- 

6 it was called International Imaging Systems. 

7 It was referred to as I Squared S. I bought the 

8 facilities of that division or that subsidiary and 

9 formed Stanford Technology Corporation U.S. as a wholly 

10 owned subsidiary of Stanford Technology S.A. in Geneva, 

11 and we added manufacturing capability to Maco, but outside 

12 of the U.S. 

13 Q What period of time — let me withdraw that questioi 

14 When did you form Stanford Technology Corporation S.A.? 

15 A I believe either late 1973 or early 1974. 

16 1974 — I cannot be quite sure. 

17 Q I think you mentioned that you had moved from 

18 Iran to Geneva at that point in time? 

19 A I maintained residence in both places. I had my 

20 place of residence in Iran amd I had my place of residence in 

21 Europe and I owned homes in both places. 

22 Q Staying just with Multicorp for a moment, did 

23 Multicorp engage in any other business activities other than 

24 the ones you have already described? 
2^ A In addition tc^renrjaa^^ation of companies, we 



In addition ±o_renrftaftftt. 



46 



UNCLASSIFIED 



16 



1 continued to provide technical services, systems work. I can 

2 not remember any — I don't think it was within a group of 

3 companies of MCI that we got engaged in other activities. 
I personally got involved in the real estate and hotel 

5 business basically because my father was in that business. 

6 But Multicorp pretty much stayed in that business. 

7 Q When you say Multicorp stayed in that business, 

8 you mean the other businesses that you described? 

9 A The representation, prrnridng technical services, 

10 systems, and all in the area of electronics, although 

11 sometime later it changed. We were asked to add additional 

12 capability to our line of activities as far as representa- 

13 tion is concerned. 

14 Q What was the business of Stanford Technology 

15 Corp S.A.? 

16 A Stanford Technology Corp S.A. was the owner of 

17 Stanford Technology U.S.A., basically because I was there. 

18 I was rxinning my business from Switzerland, so the company was 

19 there. I did the banking side of the business through 

20 Stanford Technology S.A. for the contracts that they entered 

21 into. I had no involvement in the operation and management 

22 and running of Stanford Technology USA. SDCUSA had its 

23 own structure: President, Vice President, acceptable in 

24 the U.S., so we did the marketing, the international 



25 



marketing. Stanford Technploov ^-A. effectively -- 



47 



IINCUSSIflED 



17 



1 Q Stanford Technology S.A. was a holding company 

2 for Stanford Technology U.S.? 

3 A Yes, but at the same time it did marketing for 

4 Stanford Technology USA. 

5 Q What was the business of Stanford Technology 

6 U.S.? 

7 A Well, at the beginning it focused on systems — 

8 as a systems house trying to put various systems together — 

9 Q What kind of systems? 

10 A Communications, intelligence collections systems, 

11 again, part of communication. 

12 Q What type of intelligence collection systems? 

13 A Receiving stations, receivers covering a wide 

14 spectrum of frequencies, and using computers and tape 

15 recorders to several transmissions and record them and 

16 then give the capability to the client, to the customer, 

17 to the user. 

18 Q Who were the clients of Stanford Technology U.S.? 

19 A Again, the government, as I mentioned earlier. 

20 Q Which government? 

21 A The Iranian government at that time, although 

22 Stanford Technology S.A. within its own structure and 

23 within its own marketing effort tried to open up new 

24 markets, and they had the charter to do so. And they — 
for instance, they apcrMchfid _tl|a Egyptian ma;;ket. They 



25 



r,u«(f rsHWi'tt 



48 



yNcussra 



18 



1 approached the Lybian market. A number of other areas 

2 that they — 

3 Did it acquire any other customers besides 

4 the government of Iran? 

5 A I am coming to the next category of activities. 

6 I mentioned earlier that we purchased the facilities of 

7 I Squared S, and this bankrupt had dealt with a technology 

8 that is referred to as image processing, or we refer to 

9 it as image processing. 

10 The work of I Squared S was incomplete in 

11 finishing the research development and manufacture of 

12 the products that they were after. We started to also, 

13 at a lower pace, complete those products that remained 

14 incomplete. We continued with our research development, 

15 and when the business of systems in STC slowed down -- 

16 the systems business is a very risky business because you 

17 create — you mobilize and you get a lot of people, and if 

18 you don't get continuation — 

19 Q When you say systems business now are you still 

20 on the collection of communications, intelligence?, 

21 A Communications and intelligence, yes. It is a 

22 risky business because you mobilize today a very large 

23 project and if you don't get into contract to followup with 

24 your activities you have all these people who have no work. 
And that is a big burden 



I 



25 



ONCLASSIFP 



49 



UNCLASSIFIED 



19 



Q In other words, you have a particular governmental 
client that orders a substantial project from you and 
after it is completed there may or may not be another 
one to follow? 

A To give you an example — this is actually 
what happened -- we had a contract with then called 
Imperial Iranian Air Force, and they were the client 




It was the Air Force. It was forced to be handled 
in two or three phases. The first phase was taken care of 
and when we still maintained our staff the people — and 
we started to negotiate for the second pat)«e, and that 
second phase was aborted as a result of the American 
advisor group that advised the Air Force that it was 
redundant. 




So the second phase was 
cancelled. I made a lot of effort to save that, and I 
was not successful. This is the eurea that General Secord 
referred to. Th^t^ j.s ^qw Jia^^ti^ ^fopta^ was over this 



ihiirtritwitrrn 



50 



UNCUSSIFIED 



20 



1 project. He canceled the second phase, which the 

2 combination of the second and third phase totaled $23 million, 

3 and the project died -- I did not stop from trying to get 

4 that project, but the project died because the commander 

5 of the Air Force was killed in an accident, and the 

6 second conraiander of the Air Force was also killed in another 

7 helicopter accident. So that project, as a result of 

8 objection of the advisory group, was abandoned, and I was 

9 left with a high overhead an3 staff of Stanford Technology 

10 Corp USA, and that is when we put a lot of effort into 

11 developing the image processing end of our activity and 

12 completed design development and started to manufacture 

13 image processing equipment. 

14 Q What time period was this that you lost the 

15 second phase of the contract with the Iranian Air Force? 

16 A I cannot be certain. I believe it was in the time- 

17 frame of 1976. It could be 1977 — 1976. 

18 Q What is image processing? 

19 A What we referred to as ima^ processing is a 

20 computerized electronic facility that interprets aerial 

21 photography. They take them for agricultural purposes, 

22 for mining purposes, forestry. You take the aerial photos, 

23 feed it into this image processing system that through 

24 false coloring and enhancement ^^ijVe^YOU an interpretation 
of what those photos are. 



25 




51 



UNCLASSIFIED 



21 



1 Q And this was done by a company you have 

2 referred to as I Squared S? 

3 A Which was a subsidiary of Stanford Technology 

4 Corp USA, I believe. 

5 Q Who were the principals of Stanford Technology 

6 USA? 

7 A I have had -- still have — the policy is that 

8 the key employees of the company should have financial 

9 motiviation. As a result of that policy, in Iran I gifted 

10 or sometimes sold stock to the employees and collected the 

11 money through a prof it-sharing scheme that I had. I did the 

12 very same thing in Stanford Technology Corp. I had two 

13 basic partners there. On eJof them became the President, 

14 and the other one the vice president. 

15 George Holeburg was the President of the company 

16 and also a stockholder, and the other one, the vice president 

17 of marketing, Richard Ashcroft. They were the key officers 

18 of the company. We are still a start-up company, a small 

19 company. 

20 Q Were they recruited by you or were they part of 

21 the bankrupt organization that you acquired? 

22 A The relationship came about differently. George 

23 Holeburg and Richard Ashcroft, they were officers of one 

24 of the companies that I represented — Engineering Systems, 
2^ I believe is the nam^« aad»»Vi^ AJeyne|iraj#h»^communications 



"tiliMTlwinr*n 



52 



uNMSsro 



22 



1 business. They dealt with me and knew about ray capabilities 

2 during the time they were my principals -- by principals 

3 I mean being for the company that I represented. And 

4 they were aware of my total business plan, and they 

5 offered to join me in this Stanford Technology Corp ef^'ort. 

6 So it was not really quite recruitment — it was an 

7 agreement that they would cone in as partners, and we 

8 would start Stanford Technology Corp USA together. 

9 Q Were you equal partners in effect? 

10 A No, I maintained the majority of the stock. 

11 Q And I take it the profits were shared in pro- 

12 portion to stock ownership? 

13 A Unfortunately, the company was not profitable, 

14 the STC USA end of it was not profitable. It got — 

15 Q I guess what I am asking you here is what the 

16 arrangement was. 

17 A The arrangement — obviously there would be a profit 

18 and we would agree to share the profits. It would have been | 

19 based on the percentage of stock that we held. 

20 Q Was I Squared S profitable? 

21 A It started to become a substantial activity. 

22 I think it was 79-80 that the company started to show some sigr 

23 of improvement technically and financially, and by this 

24 time Mr. Ashcroft had become the President of the company 

25 and f4r. Holeburg had left the orQaniza^Mpn , and Mr. Ashcroft 



had left the organizatip: 



53 



UNCIASSIRED 



23 



1 did turn the company around and brought it to a point that 

2 a number of venture capitalists were interested in purchas- 

3 ing that image processing capability of the company, and 

4 indeed I did sell that portion of the company some time 

5 earlier in the 1980's. 

6 Q I take it there came a time when you left 

7 Iran, I think you said some time around 1979? 

8 A That was when I stopped going back to Iran. 

9 I had lived outside of Iran, as I mentioned, in Europe 

10 going back to 1975, 1976. I received a residence 

11 permit in France, and I started to live as a resident of 
1'2 France. I came to the U.S. prior to the revolution, 

13 just prior to the revolution as the result of personal 

14 family problems that I had. 

15 So then — by then the revolution came about 

16 and that is when I stopped traveling to Tehran. 

17 Q And I take it that you operated then Multicorp 

18 up until the time of the revolution? 

19 A That is correct. 

20 Q And what happened to Multicorp when the revolution 

21 occurred? 
A I don't have first-hand knowledge. Through 

various sources I learned that all assets of the company, 
also my personal assets, the monies, the fixed assets and 



all, were confiscated by the government, but technically, 

mini AOOirirn 



54 



UNCUS«D 



24 



1 legally the company still is not ^iso*v«d. They are still 

2 in existence. It was this facility that attracted General 

3 Secord's attention while I was still in the government and 

4 in the U.S. in the Pantagon, that prior to my becoming 

5 a U.S. citizen, he wanted to use my facilities in Iran 

6 for the rescue of the embassy hostages. 

7 That was when I was approached. I don't believe 

8 I was even a permanent resident in the U.S. at the time. 

9 Q Let's come back to that. I want to make 

10 sure we have covered the period up through the revolution 

11 in Iran. You have mentioned Multicorp and its various 

12 business activities. You have mentioned Stanford 

13 Technology Corp S.A. , and its American subsidiaries, and 

14 you have mentioned some real estate hotel activities that 

15 you carried on in a personal capacity. 

16 Did you engage in any other business activities 

17 other than those that I have just mentioned prior to the 

18 revolution? 

19 A No. Basically, these were the type of activities 

20 that — I ccin't recall any. 

21 Q And just to make sure we understand, some time 

22 around 1975 or 1976 you began to live principally in France; 

23 is that correct? 

24 A I was commuting prior to that. My children, as 
a result of the -fairly nrnhl^iu were staying in Switzerland, 



25 



tirfmriftffitiifft 



55 



14 



16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



UNCLASSIFIED 



25 



by the way, Hewlett Packard — the reason I chose Switzerland 

2 was because Hewlett Packard was there. 1 was dealing with 

3 Geneva even prior to my moving there, so I had a reason to 

4 go to Geneva. And then because of the family problems 

5 iny kids were sent to b ordrn g school in Switzerland, and that 

6 is how I started to focus on Geneva. 

1 I was commuting for a year or so before I 

8 established residenceship in France. 
g Q Commuting from where to where, Tehran to 
10 Switzerland? 

A Tehran to Switzerland. 

Q In other words, your wife and children moved 



13 to Switzerland? 



A My wife was in Iran and the children were in 



15 Switzerland and I was ccanmuting between Tehran and Geneva, 



and that was when I started to expand also my business 
to other parts of the world beyond Tehran, and I formed a 
company called Expand Trade S.A. that did general trading — 
this is prior to even forming Stanford Technology Corp S.A. 
So I effectively tried because of my family situation to 
have an echo of MCI in Geneva on an expanded basis to cover 
other areas than Iran and £xpand Trade S.A. was that 
organization that dealt with representation of other 
companies and sold in Iran, and we started to become 
active in selling in other parts of the world and until I face 

luioi Aooincn 



56 



UNCUSSIflED 

1 I a very unfortunate situation. That related to the famous 
case of Frank Terpil and Edwin Wilson when they penetrated 
into my STC and txpand Trade structure in Switzerland 
and as a result of that I closed down the companies -- I didn't 
dissolve them, I closed down the company for a certain 
period of time until I was satisfied that -- I fired the old 
people - until such time I was satisfied that Wilson and 
Terpil had no links in that structure of 

n>ine, and then I reopened it. So I faced the unfortunate _ 
situation that I had to really lose everything that you 
had started because of these two gentlemen penetrating 
into my organization. 

Q I want to come back to that in a minute, but again 
to make sure we understand, there was a time in the early 'TOs 
as I understand it, when your children were in Switzerland. 
YOU were primarily residing in Tehran, but you commuted 
to Switzerland, and then there came a time when you made 
your principal home in France right outside of Geneva. 
A That is correct. 

Q And that occurred in about 1975-76? 
A That is correct. 

Q And you remained there until some time in 1979, 
when you made your principal residence in the U.S.? 

A I believe it was 1978, if I am not mistaken. 

aall . ... not .ecoj^^J-^^ rft6<^Pfrrt° " "'""' " " 



57 



27 



UNCLASSIFIED 

precise on that. These are the dates that I remember at 

2 the time. I did not become a resident, a permanent resident 

3 of the U.S. until 1979, but I started to live in the 

4 U.S. prior to that, I believe it was 1978. 

5 Q And you have made a reference a number of times 

6 to the reason, but I am not quite sure I understand — why 

7 was it that you decided to move to the U.S. in 1978 or 1979? 

8 A I was going through a divorce process. My business 

9 has always been international, traveling, spending a lot of 

10 time away from home. 

11 My sisters lived in California, and my father was 

12 there. There is a large Hakim family in the U.S. I had 

13 the custody of my two young kids, my two daughters. I 

14 had the responsibility of being a father and a mother, and 

15 a businessman, so it was much easier to be around my sisters 

16 who could assist me when I was traveling. So that was the 

17 main reason that I sold my house in France and came to the 

U.S. 

I was well-established, well-structured in 
Switzerland. I did not come to the U.S. because of the 
revolution. It has always been my dream to — this was 
discussed many many times with people such as Mr. Ashcroft 
from the time that I was in Tehran, it was my dream to corae 
to the U.S. and reside in the U.S., become a citizen of the 

U.S., but what fSlPfJ^^'^a'^^^i'gfif^l^ ^^^ "•^* ^^^ "°^ ^^^ 



58 



mmM 



28 



1 revolution. It was the family situation. 

2 Q You mentioned Wilson and Terpil penetrating 

3 your organization and that that caused you a lot of 

4 difficulties. Could you just explain that set of 

5 events for us, please? 

6 A Mr. Ashcroft as the vice president of marketing 

7 of Stanford Technology Corp U.S.A., had the responsibility 

8 of expanding the marketing capability of the company to other 

9 areas. He came across Frank Terpil — I still don't know 

10 how to this date — and he decided that Mr. Terpil could be 

11 effective in helping him to expand the market. So on 

12 behalf of Stanford Technology U.S.A., not S.A. , he entered 

13 into agreements and arremgements with Frank Terpil. 

14 I believe — again one has to refer to the records 

15 to get the exact course of events — I believe until — for 

16 a very short period of time Mr. Terpil was engaged as aM 

17 employee of the company and then later on Mr. Ashcroft decided 

18 to have a base in Washington, and he entered into some sort 

19 of am arrangement, an agreement with Mr. Terpil, and they 

20 formed a company in Washington D.C. — I cannot recall at the 

21 -taMke time the name of the company — and the purpose was 

22 for Mr. Terpil to assist Mr. Ashcroft in the marketing 

I 

23 and expansion of our market. ■ 

24 Mr. Wilson joined this Washington D.C. company 

25 at a later date through introductiflfw^f Mr. Terpil, and they 

■ i&iAi lomrirn 



59 



UNCLASSIFIED 



29 



became acquainted with the total system that we had^ that is 
the American operation, the Swiss operation, the Iranian 

3 operation. I learned later that they found that very 

4 attractive for the plans that they had and which I was 

5 not aware of — 

6 Q This is Wilson and Terpil now? 

7 A Yes. And they trave^ to Tehran. They 

8 traveled to Geneva. Still I did not have any control 

9 over their activities. They decided that it would be 

10 best since we were in an international business for them 

11 to operate out of Europe, although Mr. Terpil continued to 

12 keep the Washington D.C. company. I believe by this 

13 time he had purchased this company from Ashcroft, 

14 Stanford Technology — 

15 Q What company did you say he purchased from 

16 Mr. Ashcroft? 

,7 A The Washington D.C. company that I mentioned 

18 earlier that was formed as a subsidiary of Stanford 

19 Technology U.S.A. I believe he purchased that or it was 

20 given to him. I'm not quite sure how it worked out. But 

21 what I could see with my own eyes was what was happening in 

22 Switzerland or in France, and that was the whispering and 

23 appearance of Mr. Wilson and Mr. Terpil at times that they 

24 were not supposed to be there, and I started to suspect that 

25 something was ^°^"9kf "k ^^^i^^V^*^ ^° notice how close 



60 



UNCLASSIFIED 



30 



1 they had become with my employees. 

2 By the way, by this time Mr. Wilson had managed to 

3 borrow some money from me. I don't remember if it was 

4 $20,000 or $30,000, for which he gave me a note, and at 

5 a later da;.e to collect this note I believe I went 

6 through the process of suing him, but I managed to get 

7 the money back. 

8 It was a matter of principal. He threatened 

9 to kill me, run me over and all that, but I managed to get 

10 the money. People told me I was crazy to deal with this 

11 man because he really meant what he said. It was nothing 

12 for him to kill me. And that was quite a shock for me because 

13 when these gentlemen were introduced to me they appeared 

14 to be highly respected, highly placed, and when I saw 

15 this change of face, I became disenchanted and I fired all the 

16 employees and said, "Let me start clean." 

17 Q Mr. Hakim, I don't quite understand. What is it 

18 exactly that they did that upset you? 

19 A They were using my facilities for their own 

20 purposes, for the deals that I was not involved with, and 

21 knew nothing about. 

22 Q Are you telling me that they had your employees 

23 performing tasks and business transactions that you were 

24 unaware of? 

25 A Exactly. 



UNCLASSIFIED 



61 



UNCLASSIFIED 



31 



1 Q Can you just give us an example or two? 

2 A The general manager of my European operation 

3 at that time was an American gentleman, Richard Wood. 

4 He and his wife, who acted as the secretary of the company, . 

5 ran the business for me. I have to point out that at 

e no time, including even the recent affairs, I have had the 

7 style of getting involved in details. 

8 I have always employed people and delegated work 

9 to them and let them — with a lot of trust, to run the busi- 

10 ness, and I would get involved in the overall supervision. 

11 So Mr. Wood had a lot of latitude, and I sensed at one 

12 point that things were not being done. We had a business plan 

13 for expanding trade, which Mr. Wood had prepared. 

14 I was promised by him that deals would be 

15 coming through any day, any minute, and none of those 

16 materialized, and then I still saw that Mr. Wood and the 

17 staff, they were all busy doing things and then some 

18 secretaries started to whisper into my ears that things 

19 were happening, and I started to pay more attention, and 

20 I saw that there were activities going on that I was not aware 

21 of. And I had the Iranian market, which has always been my 

22 main client. Iran has always been an attractive market for 

23 me, still is. It has a lot of potential. I didn't need this 

24 messy work that was going on. I decided to cancel all that 

25 out and restructure it and focus on srr uSA and the Iranian ■) 

^ imni RCOIClCn -^ ^^^ 



62 



UNCLASSIFIED 



32 



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 What time period was this that you kicked your 
employees out and Wilson and Terpil? 

A I would say again around 1976 — 1976-1977. 
1976, I would say. 

Q Focusing now on the time after you moved to 
this country -- by the way, when did you become an 
American citizen? 

A September of 1984. 

Q Focusing on the time after you moved to the 
United States, could you just briefly identify for us 

the business activities that you have been engaged in and 

c\eS0.r,pi-vOM 



then we can perhaps get into some further 
Just identify if you could for us the different business 
activities that you have been involved in since you moved 
to this country. 

A Since I moved to the United States, I had lost 
all my businesses. 

Iran, like I told you, was my prime marketplace. 
That was totally out of reach. When I came to the United 
States, I started to look into the Stanford Technology 
Corporation U.S.A. 's activities. It was facing a lot of 
financial difficulties. I had pumped hundreds of 
thousands of dollars into the company. And as a result 
of my negligence and — which was justified to me because 
I was focusing on the Iranian market, this business was 

iiMPi Aocinrn 



63 



UNCLASSIFIED 



33 



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 



going dovm the tube. 

I came back and started to concentrate on 
STC U.S.A. I fired Mr. Holberg and promoted Mr. Ashcroft, 
made some changes and started to apply the very same 
technique; i.e., I came up with a stock-sharing program 
for the other key employees of the company, and Mr. 
Ashcroft did a fine job in fulfilling the directions 
that I had established, and we turned the company around. 

By this time I really had no other business 
except that I was trying to turn the company around. 

Q When you say no other business, you mean no 
other business besides Stanford Technology U.S.A.? 



around? 
A 



That is correct. 

And you turned the company around. 

What business did it do after you turned it 



After we turned it around, I decided that I 
had no interest, personal interest in being involved 
in what I call a routine type of activity. International 
Imaging Systems to me is a conventional type of manu- 
facturing firm. Everything is predetermined. It is not 
creative. I don't like that life style. I like to 
be — to c.-^ntinue to be creative. 

I decided to sell that part of the business. 
International Imaging Systems, and restart the systems 

■•Ai#%i ■Anirirn 



64 



iinmim 



34 



'' business. 

2 Q This is intelligence collection? 

3 A Intelligence -- once you have systems 

4 capability, Mr. Nields, you can put almost any kind of 

5 system together, whether it is communicacions , whether 

6 it is security, whether it is intelligence collection. 

7 The main ingredients of those systems are the same. You 

8 have a computer, you have a receiver, a transmitter, 

9 antennas, sensors -- depending on how you put it together, 

10 you use it differently. 

11 So basically I was in the systems business. 

12 Intelligence collection is part of a systems business. 

13 Intelligence collection, when I refer to intelligence 

14 collection, I do not mean necessarily the spooky 

15 business. I mean collection of information: collection 

16 of information that is being transmitted through radio 

17 waves, collecting those and having the clients interpret 

18 it for their own benefit. 

19 Q Has Stanford Technology done that kind of 

20 business from the time you restructured it until today? 

21 A No. When I restructured it, we had lost the 

22 market for systems business. 

23 Q I understand. And then you went back into 

24 that b««itis»s, as I understand. 

25 1 start4ilft.«/v« beadi >v\jta: systems business 



■ ""'TIRIPI It^CTEfrif 



65 



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 



w/isjife 



again, but not focusing on information collection, not on 
receiving stations. This time I went into systems 
security. 



And had continued in that business to this 



day? 



A Security meaning the systems business? 

Q Yes. 

A That is a hard question to answer. I made all 
the investments. It takes a lot of investment to 
establish your credibility in a new market. I had lost 
the only market I had. 

I focused on the Far East. I pumped -- by 
this time I had sold the imaging systems part of the 
company and started the systems business. To this date 
I believe I pumped into the company most of the money that 
I had received as a result of the sales of the imaging 
part back into the systems company, now with a focus on 
security, because early in 1980, if you recall, security 
became a very important issue. By security, I have to 
give you some explanation of what I mean by security. 

This is physical security. This is, if you will, 
an anti-intrusion system. It is like an alarm system 
that homes use, but very sophisticated. You can use it 
for nuclear power plants; you can use it for radar sites; 



you can use it fo 



industrial parks. And I managed 



miPlffcicirn 



66 



UNcussife 



36 



1 to get a contract from the Korean government which, with 

2 a lot of difficulties, we successfully finished that. 

3 So I had reached to a point that I was ready to 
* go oui: now and start making money. All the money that 

5 hau gone into the company was to learn about the business, 

6 learn about the market, get one contract at a loss to 

7 establish our credentials so we could go into the market 

8 and get new projects. That was the main attraction that 

9 I had in wanting General Secord to join me, because I 

10 thought with his background he could assist me to 

11 capture new markets in the area of security. 

12 And by this time I had really increased my 

13 respect for General Secord. 

14 Q What time period are we talking about now, 

15 1984? 

16 A Well, it was -- I started the business of 

17 security, I believe, in 1980, 1981, I believe; it could 

18 be 1982. 

19 Q I mean when did you get General Secord to join 

20 you in your business? 

21 A 1983. 

22 Q Okay . 

23 Prior to the time that you had General Secord 

24 join you in your business, I take it the only business 
^^ activity thnf j-ji^ Jt'i^'^ '^1Wf#"tfi*itf'^^^ moving to the 



imr«mxfftrfnr 



67 



nfsussim 



37 



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 



United States was Stanford Technology U.S.A.? 

A After I moved to the United States, first it 
was Stanford Technology Corporation. Then I sold that 
part. I went into the security business. Then at the 
same time I created other activities which basically was 
meant to help the relatives and friends who were running 
from Iran, coming to the United States or other parts of 
the free world. 

I went -- for instance, I started to create a 
chain of delis, a business totally out of my expertise, 
and yet it was simple enough that I thought these people 
that I knew that I like to refer to them as refugees, 
could run and do business in. They were not successful. 
I incurred a business loss there. I — 

Q Any other business projects? 

A I got a little bit into real estate. 

Q Where? 

A In the United States. 

Q Where? 

A Mostly in California. 

Q What else? 

lINCUSSIflED 



68 



jir fls bp 
1 1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

16 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



Mmsm 



38 



A I was conned into — it appears I never learn. 
I was conned into an activity of manufacturing electronics 
gadgets. An ex-employee of Stanford Technology Company 
approached me to — fxrst Jj^ lend him money for a company 
that he and another gentleman had started and he gave me a 
rosy picture about their company. 

The company's naune was Textronics. To make a long 
story short, I caane in there as a p>erson to lend them money 
and I got sucked into this to the point that I had lent him, 
if I remember correctly, something like $8,000, and the company 
had not produced any income, and I had to take over that 
company, and that turned out to be a total loss as well. 

Q Anything else? 

A I got involved and formed a company that never got 
off the ground 

Q You don't need to mention companies that didn't 
get off the ground. 

Were there any other business activities of any 
substance that you engaged in? 

A No, not that I remember. 

Q As I gather it, at least between the time that you 
moved to the U.S. and the time when General Secord joined you, 
none of your businesses made profits? 

A I didn't expect them to make profit because 



UNCLASSIFIED 



69 



wuss/fe 



39 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

16 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



" Q I understand, but in any event, they didn't? 

A That is correct. 

Q I take it then that you had some monies available 
from the time when you had been conducting business in Iran 
and Switzerland and France? 

A And also largely from the sales of _£nternational 
Imaging Systems. That portion of the company I sold for 
$3 million. 

Q Was that a $3 million profit? 

A No, it was — it was, if you will capital 

Q Partly money that you had originally invested in 
the business and partly a gain? 

A Partly a gain. 

Q Where did you keep the monies that you had available 
to you, were they kept in banks in this country, or overseas? 

A The monies that I earned in the U.S. were all 
kept in the U.S. They were monies that were kept in my 
place of business in Switzerland — that is where I was. 
I don't remember when the last parts of that — the monies 
that I had in Switzerland I brought to the United States, 
I was basically living off of my savings and the money that 
I got as a result of sales of Hyde Park Square. I had money 
overseas, but eventually it all ended up in the United States. 

Q I take it Multicorp had been a profitable 
business venture? 



Multicoro had been a pro 

UNCLASSIFIED 



70 



2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



Very much so. 



*M%r 



U 



40 



Q And were you unable to take money out of Iran from 

Multicorp? 

A Yes. 

Q So you had that money available to you and originally 
you had that in banks in Switzerl::nd? 
A That is correct. 

Q But there came a time when you took all the money 
out of banks in Switzerland and put ifi only in banks in the 
United States? 

A Effectively your analysis is correct. I brought 
it to the United States and either put it into STC or spent 
it, but particularly you are right that it came through 
bank channels to the United States. 

Q In any event, you are saying that there came a 
time when you no longer had money on deposit in Swiss banks? 
A There came a time when no longer I had any money, 
substantial sums of money, that earned any profits or interest • 
your terminology is correct, I didn't have any deposits. I 
had some checking accounts. I was using them for household 
purposes, which I believe is still there. 

Q Checking accounts in Switzerland? 
A In Switzerland, yes. 

Q Just so we understand what your concept of 
substantial is, can you give us just an 



UNCLASSIFIED 



71 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

1' 

II 

1( 

i: 
ii 

19 
20 
21 
22 
23 
24 
25 




A I don't believe that bank ac^9Slft today has — I 
would be surprised if it is more than $5,000. It should 
be less. I don't know. 

Q And I take it — when was it that you had, in effect, 
moved your last monies out of Switzerland? 

A I can't remember that, Mr. Nields. 

Q Approximately? 

A The best way that I can help you with that is I 
would say some time between 1979 and 1982, in that time 
frame. 

Q And then I take it after that time frame you had 
small amounts in a checking account, but it would be something 
under $100,000 at all times? 

A Oh, definitely. 

Q Okay. 

You mentioned General Secord. We haven't talked 
about him yet, but you have mentioned him a couple of times. 
Could you just briefly tell us how you first came to know 
him and — well, tell us that first. 

MR. JANIS: He has already testified to that. 
Do you want him to go over it again? 
MR. NIELDS: Maybe not. 
BY MR. NIELDS: 

Q I take it you met him at the time when you lost 
the second phase of your contract in Iran? 



UNCLASSIFIED 



72 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

2B 



mmim 



42 



A That is correct 

Q After that event when was the next time that you 
came across General Secord? 

A That event, which started in a very negative way, 
when I started to analyze it, I accepted I was biased, I 
wanted the business. 




I 



1 1 started 

to develop a liking for the man who had just caused me to lose 
$23 million worth of business. 

Q Did you continue to see him — after you lost the 
business, did you continue to see him in Iran? 

A I don't think so. By then I don't think I was 
even in — I was not even living in Iran at the time. I was 
in France, I believe, at that time. 

Q Did you see him in France? 

A No. 

Q Okay. Did you see him in the United States? 

A Yes. 

Q When? 

A I think I started to go and see him in the Pentagon- 

Q When? 

A Around 1977, I started to go and pay my respects to 
him and see him. 

A What was t^9mW£SP^^ °^ your seeing him in the 




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A I have always thought that Secord had a lot of 
capability that I was hoping at one point I could benefit 
from. 

Q In what way? 

A He was in the different side of the fence. He 
was in the military business; I was in the military business. 
He was in security; I was in security. But you do recognize 
what I am trying to say — he could become a potential 

Q Customer? 

A Customer, and 

Q Did he ever become a customer? 

A No, he didn't. I sort of kept track of him. 

Q Did you ever do business with the Pentagon? 

A No, never. 

Q Did you ever attempt to do business with the 
Pentagon? 

A No, I never did. 

Q Did you ever attempt to do business through General 
Secord with the Pentagon? 

A I assume that you mean while he was still a^ 
government employee? 

Q Yes. 

A No. 

Q On how many occasions did you meet with Mr. Secord 



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1 "while he was still in the Pentagon? 

2 A I would be surprised if it were more than 10 times. 

3 Q what did you discuss? 

4 A Basically what I was doing, where he was heading, 

5 asking him what his plans were, sort of keeping track of him. 
g Q When you say asking him what his plans were, did 

7 you discuss the possibility that he might come into business 

8 with you when he left the Pentagon? 

g A I don't think I discussed it with him, but I 

10 believe that I told him that a man like him has a lot of 

11 potential to make a lot of money, ajid he was not making enough 

12 money by staying in the government. He always kept his icy- 

13 cold face. He didn't move anything that would lead me to belie 

14 that he was interested or not interested. He continued — 

15 he really continued to keep his cold face and icy face until 

16 he came out of the government. 

17 Q In what way did you tell him that he could be 

18 making a lot more money? 

19 A I knew through independent channels that he was 

20 enjoying a lot of respect and admiration in the Middle East, 

21 and basically Saudi Arabia. And I was very much interested 

22 to penetrate that market, Saudi Arabia. 

23 Q You thought if he left the Pentagon and joined 

24 you in business, perhaps you could do that together? 
28 A Exactly 



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Q And did he tell you before he left the Pentagon 
that he was — before he left government service, that he 
was going to leave government service? 

A No, he did not tell me that. As a matter of fact, 
I learned about him leaving the government when I found out 
that one of the companies that I represented in Iran had 
interests in the Arab world, and they aske^" me if I had 
any contacts with General Secord now that he was out of 
the government, and if he could be of assistance to them in 
capturing the aircraft shelters business in a number of 
countries in the Middle East. 

Q I take it there came a time when you and Mr. Secord 
developed a business relationship? 

A That is correct. 

Q How did that come about — who initiated it? 

A I would — I was trying now in the United States 
to get back on course and do what I intended to do in Expantrad^ 
when I started Ebcpantrade in Geneva, and I did not succeed 
and to complete what I wanted to do as a result of the Terpil- 
Wilson case. I decided to do the same thing here in the 
United States. I had that in the back of ray mind. I was 
advised that if I wanted to do that there would be complication? 
with banks, antitrust laws and such, and when I learned about 
the new facilities that were provided Uium^ this export 



trading company lawi 




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and I found out that 




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elieve this bill 

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now I could form my trading company 

became law in October of 1982, and early 1983 I formed S tandoE d 

Technology Trading Group International in California. 

The company was formed and I was the 100 percent 
stockholder of the company. And when I met with General 
Secord and explained to hi:;, the concept of this trading 
company, he like it very much. 

Q How did that conversation take place? 

A I told him that I had formed this company and 
the objective of this company was to go through the 
business of security into other areas of trading. 

Mr. Nields, once you establish a relationship with 
a foreign government by getting a security contract, that 
means that particular government has to trust you, to let 
you know what their fears are, and once you get into the 
business of security, you have a deep penetration in that 
government and therefore you can do a lot of business. 

So, when I explained to him — when I explained to 
him that the medium that I wanted to use to get into these 
countries is security, it will be(money(raakingl itself, but it 
will open also the door for us in other businesses with those 
countries. That was very attractive to him. He saw 
the potential, what could be done. 

Q When was that conversation? 

A I believe I had the earlier discussion of this 



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\ thing — I cannot be sure. I believe that the early 

2 discussions were held in Washington, then I invited him 

3 to come to California and see STC and meet my staff and 

4 Q Was the earlier conversation at your instigation? 

5 A Yes. 

8 Q And then you invited him to come to California? 

7 \ Yes. 

8 Q He was now outside of the government? 

9 A Yes, he was. Bu the way, there is one other 

10 thing I would like to add to here, that there was — I have . 

11 mentioned that earlier, but I would like to elaborate on 

12 that. General Secord was still in government. He called 

13 me and said he wanted — there was something very important 

14 that he wanted to discuss with me, and he asked me if I could 
16 stop by to see him when I was in Washington next. That was 

16 when he asked me if I would be willing to help with the 

17 rescue of the hostages in the American Embassy in Tehran. 

18 That was also another contact that was made by him while he 

19 was still in office. 

20 Q In any event, I take it that you and General 

21 Secord went into business together after these conversations 

22 that you had? 

23 A That is correct. 

24 Q And what was the form of jour business relationship? 
26 A He asked me how I wanted to go about this. 




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I said, Richard, I will make life easy for both of us, let's 
approach this thing the Iranian way. He said, what do you 
mean? I said, well, become 50/50 partners and we will 
go into this as if it is the beginning of my activities. 
I want you to know that I have a lot of investment in my 
other activities, Stanford Technology, and so forth, but in 
this new company we will go into it 50/50 and let's see if 
we can make use of your friends in Saudi and other countries 
and get a few large security contracts. 

And we indeed did go after thSae large contracts, . 
made a few attempts. We never succeeded to get those projects, 
basically because by this time Marwais International had 
become one of our clients for the sale of shelters, and it 
appeared to be a more attractive project. It developed into 
tens of millions of dollars -- I believe one project that we 
pursued, eind we spent quite a bit of time, and something like 
$200 million or more. 

So we decided to focus on these two projects. We 
did not succeed with those two projects and in the meantime 
the U.S. Government employed our services and we never managed 
to go after the security business the way we intended to. 

Q But you intended to do it, and I take it that was 
through STTGI? 

A That is correct. 



UNCLASSIFIED 



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Q And you were equal shareholders in STTGI? 

A That is correct. 

Q Did Mr. Secord have any interest in your 
California company, Standord Technology? 

A He did not. 

MR. JANIS: Can we go off the record for 
a mom^t ? 

(Discussion off the record.) 



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(Back on the record.) 
BY MR. NIELDS: 

Q You were about to tell us how you came to work for 
the U.S. Government? 

MR. JANIS: I don't think that is exactly what he 
said. 

He said their services wer'? employed 

BY MR. NIELDS: 

Q All right; how your services came to be employed 
by the U.S. Government? 

A General Secord talked to me, I believe, it was in 
1984 — I am not quite sure — late 1984 or early 1985, in 
that time span, that the U.S. Government -- and if I am not 
mistaken, he was more specific than that. He mentioned 
the name of the President — has asked me to help them with 
an effort to help the Freedom Fighters in Nicaragua. And he 
asked me if I would be willing to participate in that 
effort. And I asked him how long this is going to last. 
He said that I really don't know. I questioned him what impact 
and effect this was going to have on our business, are we 
going to be still able to — able to follow -up on our 
business? He said, what do you mean? I said, well, I am 
a business man, and I have no doubt in my mind that I am 
willing to help the government, but I would like to see what 
is going to happen t^oiir business. He said, well, we are 




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going to go into this as private businessmen. I said, well, 
then I have no problem. It is beautiful. I will help 
out and make money; why not? 

I asked him what was the nature of the business 

Q Where was that conversation, by the way? 

A I believe it was in Washington. 

Q Where? 

A In the office of STTGI, I believe. 

Q At that time, I take it, you lived in California? 

A I still do, yes. 

Q Did you have a home here as well? 

A There came a time that I rented for a few months, 
an apartment, a furnished apartment. I believe on two 
occasions I did that. But it never was meant to be a second 
home. It was more to serve like a hotel. So, I never 
purchased a house or anything as such. 

Q So in any event tyou asked him what this was -- 
exactly what this was to entail? 

A He said he could not go into details with me, but 
he could tell me this much, that we would be purchasing arms 
for the Freedom Fighters. I said, I know nothing about 
arms; how can I help you with this? He said, well, the 
financial end of it. I am not a businessman. The money 
matters and so forth, I need your help in that area. 

I said, fine, if this is what you need, I will be 



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more than happy to help out. 

Q In what way were you to help out with the financial 
end? 

A It was not clear. I don't think even he knew 
what he was getting into. Throughout the course of our 
working for the government in connection with Nicaragua, 
I had -- as a businessman, I had a very uncomfortable 
feeling because I was not used to running a business on a 
sort of day-to-day basis, not knowing what is going to 
happen tomorrow, whether we will be in business tomorrow, 
whether we are going to have money tomorrow. It was bother- 
some to me, but that was the nature of the mission. 

He could never be precise. He could never be 
definite. At no time he managed to answer my questions. 
And he even went to the degree of saying, when I pressed him, 
how are we going to stay in this business; he said, Albert, 
for all I know right now when I sun talking to you, we could 
be finished with the business; I don't know. We have to take 
it as it comes. 

So there was nothing definite as to what my role 
would be, how I would be doing things, and so on. We had 
to do things backwards. Normally when you start something 
you have a plan and you go in accordance with a plan. Here 
you start doing things and then you plan it. It was a weird 
situation. 



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\ Q Did Mr. Secord ever raerifTdTT the ultimate source 

2 of funds for these arms purchases? 

3 A Oh, yes, 

4 Q What did he tell you about that? 

5 A He told me that the money would be coming from 

6 donors. 

7 Q Did he tell you whc the donors were? 

8 A He never did. 

9 Q Did he mention any foreign countries to you? 

10 A He — at a much later date, he told me that he 

11 was asked to approach ^^^^^^^^| to see if they would be 

12 willing to help. That was the extent that he went — 

13 Richard always talks on a need-to-know basis. He doesn't 

14 talk much. And I respect that, and I have no interest 

16 to get into his business. So that was — I listened when 

16 he told me. I did't ask him. I didn't probe. It didn't 

17 matter to me. 

18 Q Did he tell you whether he was successful in gettinc 

19 money from fli^HHBBB? 

20 A I don't recall us discussing that any further, 

21 A Did you discuss the manner in which you would make 

22 money through his venture — before I ask you that question, 

23 let me ask you this -- had you ever been involved in any 

24 arras transactions before? 
26 A Yes, aid no. 



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I did represent a U.S. ajtununition manufacturer S 
in Iran. 

Q Who was that? 

A Winchester. However, it was not a company that I 
approached, it was not a company that I intended to represent. 
The Iranian Air Force 

Q '-'as that the only occasion in which you had been 
involved in an arras transaction? 

A Yes. 

Q That was representing Winchester selling to the 
Government of Iran? 

A Yes. 

Q Give us a very approximate quantity of sales? 

A You see from Winchester, the business developed 
ijiot other divisions of the company. It went to the mother 
company, Olin, and that had to deal with plants. We started 
to market manufacturing plants, I don't know whether you 
would classify that as arms or weapons. 

Q You meaa. plants to manufacture arms? 

A Plants to manufacture powder and the products that 
could be used for military purposes. 

Q Let's just talk about the actual sale of arms. 
What was the approximate quantity? 

A You are talking about both Winchester and Olin? 

Q Yes. 



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A In tens of millions of dollars. I can't remember 
the amounts at this time. But this representation actually 
did not, although I benefited from it, but all the papers 
indicate that my company was the agent for Olin, but there 
was one very key first letterthat I vividly remember, for valid 
reasons I remember, that was sent to Winchester by the -- 
this gentleman — I can mention his name now, he has passed 

away, Mr. Nasery 

Q Mr. Hakim, I don't want to cut you off, but I think 
you have given enough information on the Winchester thing. 

I wanted to get a general sense of prior arms 
transactions. 

A I thought your question was if I dealt with arms? 
I said, yes and no. I was finished with the "yes" part. 

Legally I did represent Olin, but I was a cover for 
the brother-in-law of the Commander of the Air Force. That 
is the "no" part of it. 

MR. JANIS: Was your question with respect to — 
if I understood your question correctly, it was whether Mr. 
Hakim had been involved in the sale of arms prior to his 
involvement in the affairs which you are investigating; 
is that correct? 

MR. NIELDS: That is correct. 

MR. JANIS: Thank you. 



UNCUSSIFIED 



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UNCLASSIFIED 



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BY MR. NIELDS: 
Q Had you ever sought to engage in either the purchase 
or sale of arms prior to the time you and Mr. Secord became 
involved in purchasing arms for the Freedom Fighters in 
Nicaragua, other than the Winchester-Olin episode? 

MR. JANIS: To the best ofiyour recollection. 
BY MR. NIELDS: 
Q To the best of your recollection? 
A As a matter of principle, I had no interest to 
go after such business, although I was approached repeatedly 
after the Iranian Revolution by Iranians to get engaged in 
that part of the business. 

I did not — I was approached, I did not. 







the answer is no. 
Q How were you and Mr, Secord going to~ 

MR. JANIS: Excuse me. 

Go ahead. 

THE WITNESS: Mr. Nields, I just want to make sure 
that I have given you a complete answer. When you talk about 
the arms, weapons, I don't know how that one extends that X 
terminology. I dealt and still am dealing with a laser site, 
which is an electronics piece of equipment that one can attach 
to a gun, use it i/»,iie^.°f.the^iron_ sights of a gun. 




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Would you consider that also a weapon? 
BY MR. NIELDS: 

Q I appreciate your completing the picture. Whether 
or not it is a weapon 

EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 
BY MR. VAN CLEVE: 

Q May I ask, prior to your involvement in the trans- 
actions that we are about to discuss in connection with the 
contras, did you ever engage in the purchase or sale of 
electronic guidance systems for any form of missile, or other 
weapon? 

A To the best of ray recollection, the areas that I 
dealt with didn't have any offensive function. It was 
defensive radars. I did deal with that. I do not know if 
the manufacturers — for instance, to be very precise, I 
represented Texas Instruments and there was a joint venture 
between three large Amerraian companies, Texas Instruments, 
ITT, and also another company called ITP, which is no 
longer in existence, and we sold a radar system, and at 
one point in time I had no longer any connection with the 
sales of this project. 

If that continued into selling the kind of product 
that you are referring to, I am not aware of it. 

Q What was the purpose of the radar system that 
you were selling? 



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A It has been such a long time and like I told you, 
I ^^s cut out of the deal at one point in time. I can't 
recall. 

Q Did it have any connection to the Hawk radar 
systems that we are going to be discussing later on? 

A I don't think so. If it did, I can't remember. 
No. 

MR. VAN CLEVE: Thank you. 

EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 
BY MR. NIELDS: 

Q How were you and Mr. Secord going to make money 
on the arms transactions? 

A Mr. Secord said that we are not going to get to 
have the normal mark up on commission that arms dealers 
apply to the sales of this product. We have to be competitive. 
This is an area that there is not much money, and I will 
determine on a case-by-case how much we can add, how much it 
can bear, what we can buy it for and the situation. I said, 
fine, so long as you remember that we have to make some 
money, I rely on you to decide how it will go. 

Q And how were you going to divide up the profits? 

A It did not get organized in a way that there would 
be a formula as to how we were going to divide the profits 
until we knew that we would continue to remain in the business 
for more than one day. We still didn't know how long we 



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1 were going to stay in the business. 

2 The first transaction, that was done through a 

3 Canadian arms dealer, to the best of my recollection. It 

4 was agreed that he and I jointly will split on a 50/50 basis, 

5 one third of the commission. That is to the best of my 

6 recollection. And that was for the first transaction, or I 

7 would rather categorize it as a transaction with a Canadian 

8 arms dealer. 

9 When we saw that there might be continuity, he 

10 tried to organize the system better. He did not think that " 

11 the Canadian arms dealer had the capability of doing what we 

12 wanted, so the Canadian arms dealer he dealt with — for a 

13 certain part of the shipment with a Portugese company, Defex, 

14 and later on General Secord decided to contact Defex directly 
16 and set up a better and more efficient system of getting the 

16 supplies so it would fulfill the operational requirement 

17 that he had. And to do so he engaged the services of Tom 

18 Clines. 

19 Q Did you personally have any dealings with 

20 either arms company, Transworld or Defex? 

21 A I had spoken with the Canadian gentleman while Mr. 

22 Secord went through gallbladder surgery — there was a period 

23 of time that he asked me to come to Washington and cover for 

24 him. I must point out that I did not operate out of 

25 Washington offices all that much. So I did speak with the 



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genteljiman in Canada, and I did take a trip with him to MA 
Lisbon to establish the credibility of Defex and reported 
that back to General Secord, and that was the extent of my 
involvement in — with either arms dealer. 

Q What do you mean by established the credibility 
of Defex? 

A If they had the capability -- we were not 
quite sure — Richard was quite annoyed by the fact that he 
could not get the kind of delivery that he was promised. 
He continuously noticed that people do not deliver what they ' 
say, and he wanted to check to see — he was either sick or 
busy with something, I can't recall. He asked me 

Q I may have misunderstood you, did you say you went 
with the Canadian arms dealer? 

A Yes. 

Q I thought you were replacing the Canadian arms 
dealer with Defex? 

A That was what we finally did, but my involvement 
was when the Canadian arms dealer was dealing with Defex. 

Q In other words, the Canadian arms dealer was 
acquiring weapons from Defex and you eventually cut out the 
Canadian arms dealer and purchased directly from Defex? 

A Yes. That is when Mr. Clines effectively replaced 
the Canadian. 

Q Who was the principal of Defex? 



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^ A I don't have first-hand information, but a Dr. 

2 Jose Garnel was introduced to me as the principal person. 

3 Q Any others? 

^ A There were a whole group of people who were 

5 introduced to me. I did't stay there all that long. 

g A I take it that you used a company called "Energy 

■J Resourced' to purchase and sell these arms? 

8 A Well, we used a company called Energy Resources 

9 to receive funds. As a businessman, when you tell me that 

10 you use a company. Energy Systems to purchase arms, it means - 

11 that we entered into an agreement, sia^fid and so forth — 

12 that we did not do. We had an Energy Resources Company and 

13 we received funds, and we, through this company, and we spent 

14 and paid out of this company. 

IB Q And I take it that there was a difference between 

16 the amount that you received and that you spent? 

17 A Yes. 

18 Q And that constituted your and Mr. Secord's 

19 A Income, yes. 

20 Q That was your and Mr. Secord's share of the profit? 

21 A The way it worked out — the way it worked out, 

22 Richard and I had an expense before getting to where we could 

23 consider what you are referring the balance to be our gross 

24 profit, and that expense was what we had to pay Mr. Clines. 

25 The way it worked out 



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^ ' Q That I take it is true in the case of the 

2 transactions involving Mr. Clines? But not true in the case 

3 of the transactions involving Transworld; is that correct? 

4 A In the case of Transworld Arms, I already testified 

5 that one third of the mark-up came to Richard and I. 

S Q But I take it that in the case of the arms that 

7 you acquired from Transworld and sent to the Freedom Fighters 

8 in Nicaragua, that you received a certain amount into the 

9 Energy Resources bank account, and then you paid a certain 

10 amount out to Transworld? Ara I correct so far; are you with 

11 me so far? 

12 A I am with you — if you see that I am hesitating, 

13 I am not quite sure that we used Energy Resources for that 

14 purpose. I have to refer to the files. That was the very 
16 beginning of our activity. That company was used. I can't 

16 recall that. 

17 Q Well, I will show you some reports in a moment 

18 that you have provided us, or rather, some accountants work 

19 papers derived from those records, but there were a number 

20 of disbursements out of the Energy Resources account to 

21 Transworld. 

22 A Then that is the account we used. 

23 Q And then there are some payments into that account 

24 from a bank in Miami, which we have identified as a bank 

28 account set up by Mr. Calero — are you familiar with Mr. 6a±ei 



I 



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UNCUSSiriED 

Familiar — I know of him, yes. 



63 



2 Q You know who he is? 

3 A I know who he is, yes. 

4 Q There is a difference between the amount that 

5 comes in from Calero and the amount that goes out to Transworld. 
g And my question to you is does that difference represent 

7 your and Mr. Secord's share of the commission? 

8 MR. JANIS: I have to object to that, Mr. Nields. 

9 Since he doesn't know — I don't think he knows 

10 how much came from Mr. Calero, so I don't think he is in a 

11 position to say what the difference is between what Calero — 

12 he doesn't even know, I don't think, whr^rTBr it came from 

13 Calero. You are referring to amounts that he might not be 

14 privy to. So for him to say the difference 

16 MR. NIELDS: I am not asking him to tell us what 

16 the difference is. We will get to the records for that. I 

17 am asking him whether the Transworld received — whether the 

18 difference between the amount into the Energy Resources 

19 account ard the amount out represents your and Mr. Secord's 

20 share of the commission, or whether it represents the whole 

21 commission? 

22 MR. JANIS: I still don't think — the problem 

23 with that question is that if the only deposits that came 

24 in from Energy Resources were from Mr. Calero and if Mr. 

25 Hakim knew they were from Mr. Calero, and the amounts, and 



ICLASSIFIEO 



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UNCLASSIFIED 



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he knew what was paid out to Transworld Arms, then your 
question would make sense; but I am not sure we have established 
any of those things. 

MR. NIELDS: That is what I am asking him. 
THE WITNESS: Mr. Nields, I did not get to know 
about Mr. Calero until some time later. Now you are talking 
in the time frame of the first transaction, the very early 
part of our activity in connection with tUs project. 
Things were not quite clear for me; not that they got any 
better as time went on. But all I knew about the direction 
of the profits was what Richard Secord ;:i5B®*d me was our share, 
and the formula that he used, he said the profit, we will 
get one third of the profit, two thirds will go to this 
gentleman. This is the best of my recollection. 
BY MR. NIELDS: 
Q Let me get at it another way. Were you involved 
in the setting up of Energy Resources? 
A Yes. 

Q As a company? 
A Yes. 

Q Were you involved in the setting up of a bank 
account for Energy Resources in Switzerland? 

fold 

A To the extent that I =603" CSF that we needed 
a bank account for the company, they set it up. 

Q Was it you who dealt with CSF, or Mr. Secord? 



UNcussra 



95 



jm 27 



uNMsro 



65 



f ' A CSF had been a company that throughout my activities 

2 in Switzerland I used, and worked with me. Our relationship 

3 goes back t) the time of Expantrade, I believe 1972. CSF 

4 started to deal with us at the credibility that I had with 
6 them, and they had really no personal knowledge of who 

6 Mr. Secord was, or what we were dealing with. So at the 

7 beginning, especially at this very first time, I was mostly 

8 dealing with CSF. 

9 Q You, rather than Mr. Secord? 

10 A Mr. Sc o f d, that is correct. 

11 Q Why was CSF used rather than an American bank? 

12 A Two reasons. The main and primary reason was that 

13 I was told by Mr. Secord that this is going to be a covert 

14 activity; and the second reason was that he wanted me to help 
16 himwiththis project, and I could not give him more than what 

16 I had, and what I had was my previous structure in Switzerland, 

17 and it happened that it served both purposes best. It 

18 could maintain the objectives of the mission, keep it covert, 

19 and also I could work with a financial structure that I had 

20 dealt with. They trusted me and I trusted them; no questions 

21 asked. 

22 If you go through — no matter how much money you 

23 have, if you go through Switzerland and say that here, I want 

24 to form a company to deal with arms, they throw you out. 
26 Those people don't Ii)s^ ^:h bfi JiiMtV^i^A that kind of 




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product. So 



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Q Did he tell you why it had to be a covert 
operation? 

A He told rae the government wanted it like this. 

Q The government, meaning our government? 

A The U.S. Government, yes. 

Q When you refer to your structure in Switzerland, 
what are you referring to? 



The background that I gave you about Expantrade, 



STC 



o Your relationship with CSF? 

A My relationship with CSF, yes. 

Q What is CSF? 

A CSF is a very conventional, normal money management 
institution in Geneva, Switzerland. The gentleman that I 
know, and in the course of time we have become friends, Mr. 
Zucker, he is an Araerican citizen, he is a lawyer. His 
expertise is in financial areas, money mangement, tax, and 
he has been doing business in Switzerland for many, many 
years, and I happen to be one of his clients. And he 
handled — before I became a U.S. citizen — all my financial 
and legal affairs. And when I became a U.S. resident, he 
also handled my teix activities. And so basically, he is 
a - f idi e iary company that deals with — that provides the total 
package to its cli^ts, legal, tax, money management, and so 



L^ts, legal, tax, money 

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Q And who is Mr. Mossads, Jack Mossads? 

A He is one of the employees of CSF. 

Q How about Roland Farina? 

A He also was an employee of CSF. 

Q How about Suzanne Hefti? 

A Suzanne Hefti, when I first met her she was an 
employee of CSF. I learned later that she went to Fribourg, 
and was no longer with CSF in Geneva, but they had some sort 
of relationship with each other, which I am not quite sure 
how. 

How about Mr. 
Jacques Bassan? 



issati 



Yes. 



.iS 



He fes also an employee of CSF. 
How about Jean de Serarclens? 

A Under Swiss laws you have to have Swiss direclives 
for a foreigner to have a Swiss company. I won't go into 
the legalities of this. So Jean de Serarclens was, or is, 
I don't know what the relationship is now, an employee, and 
the director of CSF, 

Q I take it from time to time you would make — 
well, let me step back a minute. You had them, I take it, 
you had CSF set up Energy Resources as a company and obtain 
a Swiss bank account for Energy Resources? 

A Those were my instructions. 



IINHI A!;<slFIFn 



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Q Who gave instructions as to what monies should 
be disbursed out of those bank accounts? 

A To CSF? 

Q No; to anyone? 

A But basically General Secord told us what was 
expected to come in and what we should transfer out, and to 
whom, and I passed on those instructions to CSF for execution. 

Q So you were the one who actually told CSF what 
monies to pay out of the account? 

A To the best of my recollection, most of the time 
that was the way it worked out. 



"fmim 



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UNCUISSIFIEO 



69 



1 Q And you asked me a minute ago whether I meant 

2 paying money out of the accounts to CSF. Who instructed CSF 

3 to take money out of the accounts to CSF? 

4 A In the manner that I just described. General 

5 Secord would tell me and I would tell them. 

6 MR. VAN CLEVE: May I ask a question? Would 

7 General Secord have had the power to instruct CSF to 

8 make a disbursement from the ERI account, from the 

9 Energy Resources account? 

10 THE WITNESS: The way it operated — it is very 

11 important that you recognize the fact that Mr. Secord 

12 was accepted with all due respect to him and there is a lot 

13 of respect for him. He would not be accepted in a Swiss 

14 community without having gone through years of 

15 working with them, being accepted by the Swiss. 

16 He may have the impression at the beginning that ■ 

17 you are talking about energy regourses — that he had the 

18 power to instruct CSF what to do witlithe money, but I doubt 

19 very much that if CSF, until they got to know him, would 

20 have done so without checking with me first, because I 

21 brought him into that organization. 

22 MR. VAN CLEVE: I am not sure I got an answer to 

23 my question. My question was would General Secord have had 

24 the power to instruct CSF to make a payment from the Energy 

25 Resources account? 



UNCI mm 



100 



25 



UNCLASSIFIED 



70 



1 MR. JANIS: Do you mean the legal power or as a 

2 practical matter could it have happened? 

3 MR. VAN CLEVE: The legal power. 

4 THE WITNESS: It was never clear. 

5 MR. VAN CLEVE: uidn ' t you previously testify that 

6 you instructed that these accounts be set up? 

7 THE WITNESS: Yes. 

B MR. VAN CLEVE: My question to you is would General 

9 Secord have had the power to instruct that payments be made 

10 from these accounts? 

11 THE WITNESS: I tried to explain to you how it wor]c< 

12 General Secord picked up the phone and told one of the 

13 staff of CSF please transfer — I am trying to communicate 

14 to you the mentality of the Swiss, the mentality of CSF, and 

15 the circumstances that we operated under. 

16 The Swiss would have received the instructions 

17 if he would have done it — they would have received the 

18 instructions from him and they would have called me and 

19 asked me what do we do. And I would say, "Fine, it is okay." 

20 They at the beginning. General Secord had to establish his 

21 own personal credibility for the Swiss to deal with him. 

22 So it was not a question of the fact that there was a contract 

23 signed or instructions were given to CSF thaf'CSF these are 

24 the people that are authorized to instruct you to disburse 



money. That was never done throughout the total operation. 

mini Aooirirn 



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The Swiss 



what I am trying to establish here. 



Mr. Van Cleve, is to conununicate with you a little bit 
of the way that the Swiss operate so in the days to come 
we can comnunicate better. If we use our style of doing 
business in the U.S. as a point of reference for the Swiss, 
we are going to have a lot of difficulties in communicating. 

We have to really try to understand how the Swiss 
do business and how business is done in Switzerland in order 
to be able to communicate. They do not necessarily adopt 
the same method and manner that we do business. 

MR. VAN CLEVE: I don't want to extend this at this 
point because I think it will interrupt the flow, but 
this may be a matter I will want to return to. 

MR. JANIS: Perhaps this will be a good time 
for a break. 



UNUSIFIED 



102 



UNCLASSIHED 



1 BY MR. NIELDS: 

2 Q Mr. Hakim, maybe I can make more clear the 

3 question that I am trying to get at. As I understand 

4 it from what you have said, you were the principal person 

5 who dealt directly with CSF? 

6 A That is a fair assumption. 

7 Q Because of your prior relationship — 

8 A That is a fair assumption. 

9 Q Their trust in you and your trust in them? 

10 A That is correct, sir. 

11 Q It is also my understanding that whether there 

12 were bills of sale or there weren't bills of sale in 

13 connection with these arms transactions, it is true that 

14 you and Mr. Secord in effect were paid by deposits into 

15 the Energy Resources account and then you paid some moneys 

16 out of the Energy Resources account for the arms, in 

17 effect? 

18 A Yes. 

19 Q Correct? 

20 A That is correct. 

21 Q What I am trying to find out is whether — let 

22 me say one more thing — there is a difference between 

23 the amount of money that comes in from the Miami bank, 

24 which we have identified as Calero's, and the money that 

25 goes out of the Energy Resources account to Transworld 

liMi^l Aooicirn 



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and Defex, which makes what appears to be a profit or 
commission or whatever you want to call it. And since 
you were in charge of instructing CSF about the moneys 
that were going out and so on, what I am trying to get 
at is, whose money that was, the difference, the profit 
or the commission? -tih** that originally to be shared 
just by you and Mr. Secord? 

A Not having the records in front of me, I -- 

Q Let's stop. Let me put something in front of 
you, which is a printout from the records that you gave 
us of the receipts and disbursements into the Energy 
Resources account. 

A And we are still focusing on the transaction 
with the Canadian. 

Q I eim focusing on both the transaction with the 
Canadians and Defex, and if there is a difference, I 
want you to tell me. 

A That is probably where our lack of communication 
is. The questions that I am answering, I am still at 
the time of the early stages of our dealings with this 
project and with the Canadians. 

Q Let's focus on the Canadians right now. You 
will see on this list some disbursements to Transworld 
Arms . 

I take 14:- these. a«e»^i«b»BBea«*ts in connection 



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UNCUSSIFIED 



74 



with the Canadians? 
A Okay. 



Transworld Arms is the Canadian company, I take 



it? 



A That is correct. 

Q And then you will also notice some receipts, 
and we have denominated them on this list Calero; your 
records show that they come from a bank in Miami, and 
this is -- I think it is fair to simply tell you that we 
have determined that those are receipts from a bank 
controlled by Mr. Calero. 

A Okay. 

Q Now what I aim saying is that -- my question to 
you is, does the Canadian arms dealer receive his share 
of the commission or profits out of the money that is 
disbursed to Transworld? 

A That is exactly what I said I cannot tell you. 
The problem that I have is disbursement to Transworld. 
I don't know whether it was just to cover the cost of 
the hardware or included his profit, the two-thirds. 
That I don't know. 

Q Well, did you ever pay him his two-thirds 
separately? 

A If the records show that there has been a 
separate payment, then we have. I really don't know. 



IIMPI A<I51ElEn 



105 



75 



UNCLASSIFIED 



1 Q You can look down here. We have not found any 

2 that appear to be payments to the Canadian separate from 

3 the disbursements to Transworld Arms. 

4 A I don't know. 

5 Mr. Nields, if there is no auch transfer, 

6 separate transfer for the two-thirds, then it is only 

7 reasonable to assume that this two-thirds was included 

8 as part of the cost of the hardware. 

9 Q I just want to make sure now. These are your 

10 records, Mr. Hakim, and the disbursements were handled 

11 under your instructions and specifications, and therefore, 

12 although we can read the records, we can't interpret them 

13 as well as you can. And if you need more time, I will 

14 be happy to give you more time. If you want to consult 

15 the original records, I would be happy to do that. There 

16 are disbursements out of this account to Transworld 

17 Arms. There are disbursements also to CSF; some of them 

18 are marked on your records as Hakim, Korel , STTGI , and 

19 there are others that appeeur to be for transportation. 

20 Only you can tell us whether some of those disbursements 

21 included -- whether the Canadian arms dealer was paid out 

22 of disbursements that are marked as yours or Korel or 

23 any one of the other payees. 

24 MR. JANIS: May I interpose something here? 

25 As I understood the purpose of this deposition 

mm Aocincn 



106 



UNCLASSIFIED 



76 



1 was in essence to *some sort of cooperative effort to try 

2 to prepare both the committee and Mr. Hakim for the 

3 testimony that will be coming up next Wednesday, and in 

4 that spirit, I would like to suggest a way that we can do 

5 this in a more cooperative manner. 

6 I think part of the problem here is -- 

7 MR. NIELDS: Let's go off the record. 

8 (Discussion off the record.) 

9 MR. NIELDS: Back on the record. 

10 BY MR. NIELDS: 

11 Q Mr. Hakim, we have just had a discussion off 

12 the record and I think that it has helped clarify things 

13 and I will ask you just a few questions now on the record. 

14 A Okay. 

15 Q The disbursements out of the Energy Resources 

16 account seem to fall into three categories. One is 

17 disbursements to what appear to be arms sellers. Second 

18 is expenses, mostly transportation, and the third is 

19 disbursements that go to various capital accounts. 

20 I take it that the Transworld — neither 

21 Transworld nor its principals were paid a commission out 

22 of the capital accounts? 

23 A To the best of my recollection, you are right. 

24 Q Therefore, I take it you would agree that from 
26 a review of ■W^gga^iecyni^fc d^i'W^ be a fair inference 



mmnti*iprtirtf 



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UNCUSSIFIED 



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at the very least that Transworld received its share of 
its commission out of disbursements directly to Transworld? 

A I agree with that. 

Q How about let's move now to the Defex purchases. 

A You mean now we are putting the Canadian arms 
dealer aside? 

Q That is correct. 

Can you tell us how those transactions were 
structured? 

A Basically the way I understood it, General 
Secord replaced the Canadian arms dealer with Tom Clines, 
who understands this business, who Mr. Secord has always 
had a lot of trust in, and he could also maintain 
secrecy. So effectively there was no change except the 
arms dealer, the man in between who was dealing with 
Defex from the Canadian changed to Tom Clines. 

Q My first question is, did the division of the 
commission change? 

A Very much so . 

Q Can you describe how the commission or the 
profit was divided after Mr. Clines became involved? 

A It was agreed that he would get paid for his 
expenses plus 20 percent of the commission. 

Q Did that mean that you and Mr. Secord then 
would receive b&Ob aef canW q£ m^^i ^QH^ission? 



iiKipm^itindT"' 



108 



UNCUSSIFIED 



78 



1 A On a 50/50 basis. 

2 Q Now, did Mr. Clines get his 20 percent commission 

3 out of the capital accounts? 

4 A It is possible. 

5 MR. NIELDS: Let's go off the record for a 

6 minute here. 

7 (Discussion off the record.) 

8 MR. NIELDS: Back on the record. 

9 BY MR. NIELDS: 

10 Q Do you want to clarify — I will ask my two 

11 or three questions, then you can clarify. Is that all 

12 right? 

13 Mr. Hakim, we have gone off the record again. 

14 We are back on now. 

15 I take it that we have established to the best 

16 of our ability and your recollection that the Canadian 

17 arms dealer was not paid his share of the commission out 

18 of the capital account. 

19 A That is correct. 

20 Q And you said there was a change in modus 

21 operandi when Mr. Clines took the place of the Canadian 

22 arms dealer? 

23 A That is also correct. 

24 Q One way that changed is the division of the 

25 commissions chapoeci aj\^ Mr^ QJ-iueS-aot a smaller share 



iififfT n'c^icfifn 



109 



UNCUSSIFIED 



79 



1 of the commission than the Canadian arms dealer did. 

2 A That is correct. 

3 Q Did the method by which Mr. Clines was paid 

4 his commission also differ from the method by which the 

5 Canadian arms dealer — 

6 A No, sir. 

7 Q Are you saying that Mr. Clines did not get 

8 paid his commission out of the capital accounts? 

9 A Regularly he should not have, but I would 

10 like to point out to you at this time that out of all 

11 fairness to CSF, CSF did not know what we were doing. 

12 MR. JANIS: I am not sure you understand his 

13 question. 

14 Could we go off the record and take a recess? 

15 I don't think he understands the question. 

16 MR. NIELDS: I think that is a very good idea. 

17 (Recess.) 

18 MR. NIELDS: Back on the record. 

19 BY MR. NIELDS: 

20 Q Mr. Hakim, we have gone off the record again. 

21 We are back on. We will take one more run at this 

22 problem. 

23 Again I think we established that the Canadian 

24 arms dealer received his share of the commission out of 
25 



the moneys that were paid to Transwprld, 



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A Yes. 

Q How did Mr. Clines get his share of the commission? 

A Separately it went into a capital account that 
was established for his purposes. 

Q Was that a capital account established by 
CSF or at CSF? 

A At CSF is more correct to say. 

Q And the money -- then his commissions came out 
of Energy Resources and went into his capital account? 

A Right . 

Q Now, just to close the loop on this, you will 
notice on the printout of the disbursements from the 
Energy Resources account some moneys paid to Portugal 
arms, SBSGBA, various Portugal arms, which these are not 
the Transworld; these are the Defex, I take it? 

A In Portugal the only arms dealer that I know 
that dealt with us out of Portugal was Defex. 

Q Did Mr. Clines have any interest in Defex, to 
your knowledge? 

A I have no knowledge about that. 

Q Do you have any interest in Defex? 

A No, I don't. 

Q I mean the arms selling of Defex? 



No , I don ' t . 



Did 



■I mmti 



the accounts, 



Ill 



10 



uNtussro 



81 



1 the bank accounts into which these moneys went, and I am 

2 referring now to the moneys that are on the ledger as 

3 Portugal arms. 

4 A If those accounts belong to Defex, I had no 

5 interest in it. 

6 Q Okay. 

7 What is the name of the capital account into 

8 which Mr. Clines' share of the commissions was paid? 
g A Finally when we came about to get things a 

10 little bit organized, we gave that account C. Tea, 

11 C point T-e-e. 

12 Q T-e-a? 

13 A T-e-a, that is right. 

14 Q And what was the reason for the use of 

15 c. Tea for Tom Clines? 

16 A Again, maintain — it was C. Tea. When you 

17 said it over the phone — it is for confusion, keeping 

18 the covert activity idea. So C. Tea on record could 

19 create that confusion. 

20 Q Okay. I understand. And you are telling us 

21 why it was that you used something different than 

22 Tom Clines or something that would clearly denote Tom 

23 Clines. And I guess my question is, C. Tea, I take it, 

24 was a way of reversing his initials? 

25 A Yes. 




112 



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261 



AFTERNOON SESSION 
1 : 30 p.m. 
Whereupon, 

ALBERT HAKIM 
was called fuc as a witness and, having been previously duly 
sworn, was examined and testified further as follows: 

EXAMINATION ON BERALF OF THE HOUSE SELECT COMMITTEE 

?■" ■ "BY "HR:"NIELDS: 

Q Mr. Hakim, we have taken a break for lunch now, and 
I am going to return to a topic that we were asking you about 
just before we broke for lunch. 

A Yes, sir. 

Q It has to do with payments out of the Energy 
Resources Account, which on our work papers are denoted Portug; 
Arms, SBS, GVA, and Portugal Arms DEFEX. There are a number oi 
such entries showing disbursements. We have done an analysis, 
and our chart reflects that eventually, all such disbursements 
end up in an account at SBS with a number of 

On your ledger that you provided to us, it also — that 
same account number appears, SBS ^^^^|^B with an amount of 
$11 million opposite it. $11,234,598.37. 

It is our understanding that this is a DEFEX account. Bui 
my question to you is the following: Do you, or to your 



II 



I 



knowledge, any of your business associates, Mr. Secord or 
Mr. Clines or any other business associates, have an interest 



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DNCIASSIFIED 



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k/that account? 

A To the best of my knowledge, the answer is no. 
MR. JANIS: Off the record. 
(Discussion off the record.) 
BY MR. NIELDS: 
Q Mr. Hakim, can you give us any further information 
about that account? 

MR. JANIS: To the best of you knowledge. 
THE WITNESS: To the best of my knowledge, that 
account started to be used when we faced difficulties with banks 
in transferring money to DEFEX in Portugal, and that the 
principal person in Portugal, to the best of my recollection, 
decided to use his own cersonal account that he already 
had in Switzerland, and I believe that that account is 
his, and we chose that, or they suggested that they use that in 
order to cut down on the transfer time that normally banks take 
BY MR. NIELDS: 
Q When you said you experienced some difficulty with 
the Portuguese bank, was the difficulty transfer time? 

A Transfer time. It was not limited to Portuguese 
banks, but all banks. When I transfer, it takes a — they try 
to take as much time as they can. 

We tried to shorten the time, thus increasing the 
efficiency of the shipment of the arms, because it was comings 



upon payment, 



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Q And I take it once again, just so the record is 
absolutely clear, to the best of your knowledge, neither you 
nor Mr. Secord nor Mr. Clines ever received any of the money 
that went into that account? 

A The DEFEX account — 

(Witness conferring with counsel.) 

THE WITNESS: Could you read the question back for 
me, please? 

(The reporter read the record.) 

THE WITNESS: To the best of my recollection, the 
answer is correct that money CBS account -- you are referring 
to the CBS — SBS account. That is correct. Yes. 
BY MR. NIELDS: 
Q Okay. 

Mr. Hakim, you provided us in Paris, pursuant to 
subDoena at your deposition therewith a number of -- with 
records from a number of bank accounts, and I am going to 
list them for you, and then I am going to ask you the reason 
why each one was set up. 

Albon Values: DEFEX; Dolmy; Energy Resources; 
Gulf Marketing; Hyde Park Square; Lake Resources; ToyCo; and 
Udall. 

A Yes. 

Q The records that you provided us reflected that the i 
Energy Resources account was set up sometime in December of 198^1 



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and I believe the records reflect the first deposit was also 
in December of 1984. 

MR. JANIS: Excuse me, are you talking about the 
Energy Resources account at Credit Suisse? 

MR. NIELDS: Yes. Are there others? 
MR. JANIS: As I recall, he identified another 
Energy Resources account. Let me make sure I am right about th 
He identified another account in his deposition that was also 
subpoenaed, and he provided it to you. Energy Resources account 
at SBS. 

MR. SABA: SBS? 

MR. JAMIS: M|^HH ^^ ^^^ account number. 
MR. SABA: Okay. 

MR. JANIS: Do you want to go off the record here? 
MR. NIELDS: Yes, sure. 
(Discussion off the record.) 

MR. NIELDS: In any event, let's go back on the 
record. 

BY MR. NIELDS: 
Q Relating to the Credit Suisse account, what was the 
purpose for the setting up of the Energy Resources account? 
I think you may have already testified about it, but let's go 
through it one at a time. 

A To receive the Payji^V^J^^at ^J'^P^^^'^^° "deceive 
to pay for the arms. 



/ments that we expected t 

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Q These are the arms which were being sold to the contr 
I take it? 

A Sold for the contras -- sold for the purpose of the 
contras, yes. 

Q Our records reflect a Lake Reson'-ces account at 
Credit Suisse which was opened in July o£ 1985, first 
disbursements out of the account appear to be August 1985, and 
the last ones appear to be in September of 1986. What was the 
purpose of the opening of Lake Resources account? 

A The Energy account was used, too much was given to 
too many donors, and we felt, or I felt that it was not proper 
to continue using that account if he wanted to continue with 
the covert activity, so we abandoned that company and started 
a new one. 

Q Was the purpose — excuse me. 

(Witness conferring with counsel.) 
BY MR. NIELDS: 

Q Whose decision was it to open a new account? 

A I think Mr. Secord and I jointly reached that 
conclusion, that it was time to start a new bank account. 

Q Was there — did it have a difficult — a purpose 
that differed from the Energy Resources account? 

A Not really. Not really. 

Q Is there a reason — did there come a time when you 



deliberately stopped using that a 



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A Lake Resources? 

Q Yes. 

A There came a time that I tried to put a better order 
as much as possible in a covert activity in these transactions, 
and I came up with a chr.rt that, if we would have continued 
and the accountants would have done what I wanted them to do, 
proper allocation would have been made and maybe we would have 
been able to keep a better record of the accounting. 

So there was a time that I tried to introduce a 



structure that could ba i ng in efficiency into the system. 

Q Let's return to that. I would like to touch on 
all the accounts and then return to what you have just testified 
There is an account that you gave us records for with the 
name DEFEX at United Bank of Switzerland, Fribourg,vWhith 
appears to have been opened in September of 1985, first 
disbursement that we have seen is in December of 1985, and it 
appears that the last one is in March of 1986. 

What was the purpose for opening this DEFEX account? 

A This — the purpose for this one was different. 
It was to create confusion. 

Q Who were you trying to confuse? 

A Anyone that could have put their nose into DEFEX 
Portugal's activity. We were not quite sure what would have 
happened at the other end, and we thought it would be good if 
we had a fallback position having a company under the same name. 

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Q Why? What was it that you were concerned about 
people finding out? 

A They were dealing with too many different arms 
dealers from the Eastern Bloc. We were not quite sure what was 
going on, and as we got more into this, and I learned more 
about arms business, I found it to be adequate to have a lot 
of fallback positions. 

It was a dangerous business, and I didn't want to 
get trapped with transfers — let me give you an example. 
Many times we had to make a transfer prior to receiving shipment 
and I didn't ever feel comfortable in doing that, and the 
Eastern Bloc suppliers didn't feel comfortable supplying those 
hardware. 

So, I preferred, if we could, the money to go to a 
DEFEX that was under our control and be able to tell the people 
that Llitty. money is there, and see what happens. It was — it 
was a confusion process that I was hoping to use. 

I don't know whether we got a chance to use that or 
not, but I wanted to make sure that we had maximum security alsc 
for protection of our monies . 

Q All right, let me see if I understand. DEFEX is 
buying arms from Eastern European suppliers. 

A Yes, sir. 

Q The Eastern European suppliers don't want to ship the 
arms until DEFEX tells them that they have the purchase price 



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1 paid into a DEFEX bank account. 

2 A Yes. 

3 Q You set up your own bank account in the ncime of 

4 DEFEX so that DEFEX, the real DEFEX, could tell, or you could 

5 tell the Eastern European suppliers that the money had been put 

6 into a DEFEX account. 

7 A I could tell real DEFEX that DEFEX was put into the 

8 DEFEX account. 

9 Q Would that feel real'DEFEX? 
to A I was hoping that it would. 

11 Q Wouldn't they knew whether it was their account or 

t2 somebody else's? 

13 A No, because the way the banks play around with the 

t* money, I didn't see anything wrong in us t*e play /i one of their 

^^ tricks, the bank's tricks, and see if we could get the 

^' shipment moving and feel more comfortable that the goods were 
on its way before we actually made the transfer to DEFEX. 



'• I I don't think it — I don't think we quite fully used 

I that tactic. We found other methods. I believe in one 
20 

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particular case, we used ''British bank to achieve that. 



Q But — 

** (Witness conferring with counsel.) 

" THE WITNESS: Mr. Nields, I want to make sure the 

** explanation I gave you was just as an example of why 
confusion, how we could use thatj^do that. 



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BY MR. NIELDS: 

Q What would be another example? 

A To use trace -- to lose trace of money so it could nolJ 
be identified. 

Q Can you explain that? Give us an example. 

A Let's see if I can come up with a good example. 
One of the techniques, one other technique that we used to 
lose trace of money was to cash the money and break continuity. 

That was costly. So this was another technique to 
say that the money was sent to Defex and anyone who might 
have been interested to know where the money went think that 
money went to Defex Portugal, where actually still it was 
within our system. 

Q So, this would permit you to make somebody else 
believe that you did not have control of the money when in fact, 
you did. 

A That is the best way to put it, yes. 

Q But what I am asking you to explain is who — give 
us another example of a person you would want to fool in that 
manner? 

A I cannot think of another person to give as an 
example, but when you have accounts under the same name but 
owned by two different beneficiaries, that creates a great deal 
of confusion, and that was really the basic objective, to eraat 
as much confusion in the accounting as possible. 

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Q All right, I understand that, but what I don't 
understand is who you were trying to confuse. 

A Anyone who came -- there were arms dealers, banks, 
bid quoters. My understanding has always been that if you 
trace the money, you can get to the source, and I tr^ed to 
create as much confusion element in this routing as possible. 

Just as a matter of principle, I thought the more 
confusion, the more difficult to trace the money. 

Q And in May — excuse me, April — scratch that. 

In May of 1986, you apparently put a first deposit 
in a bank account in the name of Dolmy and the last disbursement 
appears to have occurred in November 1986. 

What was the reason for setting up the Dolmy account? 

A That was again part of the reorganization, but if 
I remember correctly, we happened to use that company at the 
later date, when a requirement came about to purchase a ship. 
We had that company, so we used that company for that purpose. 

But basically, my experience was that CSF is not a 
company established for the purpose of handling covert activity. 
They were not. 

They did not have the facilities or the desire of 
getting involved in a covert activity. It was trying to slowly 
create my own, if you will, CSF, using their expertise and 
their computers, their accounting procedures, but effectively 
get to a point that I could have our own organization without 

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getting them further involved more than what they were, and 
therefore, I created a chart, and I intended to slowly 
organize our -- as time permitted — our activity, and if I 
remember correctly, I divided the world in three regions, 
Latin America, Middle East and Afr-'ca, and for each region, I 
I created companies to be used to receive money, and a receiving 
entity to act like a treasury, if you will, and then start — 
I would start giving alphabetical annotation to these 
companies, so we could, when we wanted to spend money, and 
be able to use a letter so the bookkeeper would know where 
to allocate it. 

Q You had receiving companies. What other kinds of 
companies did you have? 

A I believe that chart was printed in the Tower report. 

Q Yes, it was. 

A If I had a copy, it would refresh ray mind. I could 
explain it better. 

Q Someone else may have one. I do not. 
MR. WISE: I have the report. 
MR. JANIS: We have it. 
MR. WECHSLER: I have it. 

MR. JANIS: Mr. Nields, for the record, I have made 
available to Mr. Hakim the Tower report, and the chart to 
which he is referring is on page C-16 of the Tower report. 

THE WITNESS: Thio was my approach, trying to slowly 



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set CSF aside and start our own organization, get our own 
bookkeepers, continue to use their accountants and then be 
able to efficiently do the bookkeeping and allocation of the 
expenses and the incomes and so on, because the inefficiency 
of the system wa= so much that not only it was difficult to 
continue to keep track of what was going on, it created a lot 
of hard feelings between myself and the bookkeepers of CSF, 
especially Mr. Farina, continued to have fights, actually 
fights, and to a point that he refused to work with me because 
of the continuous mistakes. 

I talked to CSF about the possibility of subleasing 
a room in their organization having access to their computers 
and start keeping the books the way I wanted it. We reached 
that agreement. 

I asked also,CSF_,if they would be kind enough to 
interview accountants , and for us to hire our own accountant 
that we could keep the books the way we wanted it, to finish 
with the mess and the sloppiness that we had in the system, the 
degree of sloppiness was beyond anyone's acceptance. 

This system was intended — I will explain it to you 
— to expose these three companies. Lake Resources, Gulf 
Marketing Consultants, Dolmy Business, Inc., as you can see, 
as collecting companies. 

The intention was that once we used Lake Resources — 
as a matter of f ac^^.i A4iVe. ^di^te_to_the people that you use 



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' Lake Resources until such and such time, after that time, no 

2 longer use this account for transfers of any funds, abandon 

3 that. Use Gulf then. 

4 Once you have used this for so many more 

5 months, abandon that and go to Dolmy. I didn't want to come 
back, and each time out of pressure form a company, so I went 

^ ahead and formed these. 

^ So, we had these companies on the shelf. I want to 

' stick to answering the question that you asked, and if you would| 
like me to go further to explain what the rest means, Dolmy, 
although it was intended to be used as a collecting company 
because a new requirement came about for which we were not 
prepared, we were always — or at least I was always hit 
with surprises. 

These surprises created a lot of headache and 
difficulty in the total system, gave a lot of difficulty to 
CSF and its staff. The requirement was to purchase a ship. 
They wanted things done always yesterday. There waanot 
enough time. 

BY MR. NIELDS: 
Q Who wanted things done yesterday? 

A Basically, I think the agent behind this speedy style 
of activity was Oliver North, but I was getting my input from 
General Secord. Overnight, you know, get a -- go ahead, you 
are going to go buy this ship, the ship we have been leasing 



buy tnis snip, tne snip 

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until then. 

There is a new assignment. Okay, so there is no l 
time to go ahead and form a new company. The best thing I could' 
do, I used the last company in the row, the last collecting 
company in the row for that purpose, so Dolmy ended up being 
a company owning our shipping activity. 

Q I still want to come back to this chart, but before 
I do, I want to run through the other accounts. 

Dolmy, you say, was originally set up as a receiving 
company, but ended up being used for the ship? 

A That is correct. 

Q And that was something that had to be done yesterday, 
which Oliver North wanted done yesterday. What was the purpose 
for acquiring the ship? 

A At the beginning, they didn't tell me. They told 
me it was a classified operation, and I don't think I learned 
about this until after the project was — this classified projec 
was abandoned, but in the meantime, we had gone ahead and 
purchased the boat. 

As a matter of fact, I had to get corporate documents 
to go to where the boat, ship was, and actually my signature 
appears on the documents, the purchasing documents. 

Q When were you first told what the purpose of buying H 
ship was? 

A When we started to use the boat for other purposes, 

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they told me that — I think it was General Secord, said, well, 
they decided not to use our boat. 

By the way, I should come back to this. Before we 
decided to buy the boat, the boat was examined by Tom Clines 
and Mr. — a person that I knew as Olmsted. We actually 
went to where the boat was. 

I did not go there, I was there to conclude the 
procurement. I had no operational assignment. Those two 
gentlemen went and looked at the boat, came back eind reported 
back that it would suit the purpose, whatever the purpose was. 

Q When did you first find out eUaout the — 

A I believe when we started to use that boat for the 
so-called, I like to classify it as the Iranian operation, 
they told me that project was abandoned. 

Q Which project? 

A The classified project was abandoned, and that — and 
I asked what that project 




Q Did they ask you to produce some of the information 
collection equipment out of Stanford Technology? 

A No, not at all. 

Q Then, the next — we have discussed Energy, you 
started making disbursements out of the Gulf Marketing account 

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in March 1986, and continued until June 1986. What was the 
purpose for setting up Gulf Marketing? 

A I already testified, Gulf was the next collecting 
company in the row, and Lake was to be abandoned after a certai 
period of time, after it serves its purpose t'- be abandoned and 
go to the next company. 

Q Hyde Park Square. You began disbursing money out of 
Hyde Park Square in April 1986. 

A If the record so indicates, that is correct. 
Q And continued through November of 1986. 
A Yes. 

Q What was the purpose for — by the way, was that a 
pre-existing company and account? 

A Everything that you see on this chart was created 
when I created the chart. In other words, all these companies 
were formed or were there when I put this chart together. And 
this is to the best of my recollection. 

Q Our records reflect that Hyde Park Square was 
incorporated in 1983. 

A Probably it was an off-the-shelf company that we 
picked up and used. I am talking about the time that we — it 
is very customary, Mr. Nields, that you find a Panamanian 
company on the shelf ready to be taken and used right away. 

Q were these companies that had been set up for you or 



just set up by 



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y CO use? 



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A I cannot be quite sure. One company here that I am 
sure they formed as my — at my request, was ToyCo. 

Q ToyCo was formed in April 1986, the bank account was 
set up in May 1986, and it began to be used in May 1986. What 
was the reason for setting up ToyCo? 

A To answer your Tirst question, I can't recall at this 
time that these other companies were in existence, and we 
picked them off the shelf and used them. ToyCo, I remember it. 
I requested it to be formed for the purpose of what in a joking 
manner was referred to arms and weapons as toys. 

So, I came up with a name, ToyCo, and I said I "like 
to have a company to deal only with weapons, and my whole 
intention was to have a proper accounting allocation. So, if 
anyone would — if anyone put letter H on any docximent 
automatically the bookkeeper would automatically know without 
us having to explain it to them, the purpose of this activity, 
I came up with this design for the accountants not to know what 
we are doing, at the same time to be able to make proper 
allocation. 

So, if we spent money that went to weapons, for 
weapons , we were supposed to annotate that with H . 

Q Was there a particular purpose for setting up ToyCo? 

A I did not want anything that had to deal with 
weapons, arms, to be intermingled like it was with all of our 
other activities.. .Weacons in Switzerland is something that yoi.' 



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really don't want to deal with. I was trying to get organized, 
if we had to cut this company out and dispose of it without 
endangering all th e other activities to be able to perform that 
surgery. 

So, I wanted to bring in all weapon activity into 
ToyCo and concentrate on that. We had other activities, Udall, 
we started to use that to the best of my recollection for other 
activities in South America, specifically contras , I believe 
this is the company, I am not sure, to buy that piece of 
property and have other assets. 

I didn't want that to be part of a corporation that 
dealt with weapons. If I had to -- let me give you an example. 
If we had one company that owned property, and through that 
company we also transacted arms, if I wanted to dissolve that 
company, I would have been in a bad position. What do I do witt 
the assets or the property, land and so forth, that we have in 
the company; what are we going to do with that? 

So, I was trying to get to a point that weapons could 
be purchased, and dealing with weapons could go in one 
company and if we needed to cut that out of our system to be 
able to do that without endangering the rest of the activity. 

If you go back to the date that ToyCo was 
incorporated, please. 

Q That is — incorporated or when the bank account 



was opened? 



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A Well — 

Q It was incorporated April 17, 1986. 

A It was in 1986. What I am trying to say is that 
early, or during the first half of 1986, we started -- or I 
started with an effort to try to put the activity in an orderly 
fashion. 

It was a big mess, and the projects were aborted, 
if I am not mistaken, in November, our total activity was 
aborted in November. That was when Mr. Meese -- 

Q Mr. Meese made his announcement in late November. 

A Okay. So between May and November, we did not have 
sufficient time to implement this. I went ahead, structured 
it, I was hoping that I would get the accountant, the people, 
but we did bMy the waj^ quite a bit. It is very important for 
you to know, you complimented my attorney, Mr. Janis, for 
the wonderful job he did in putting the accounts together. 

Believe you me, a hell of a lot of effort went 
into preparing some of the work, even before the revelation of 
our project, that if we had not done that, in no way he or 
any other accountant could have reached to where he got in less 
than one year. That is how messy it was. 

We made an effort. We started to have computer 
read-outs. We started to find ways of going around the 
company that is not set up to do covert activities, CSF, not 
telling the employees what we were up to, not telling them that 

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we were dealing with weapons. It was a big task. Yet, 
at the same time, come up with a system that we could 
introduce order. So we did take care of a lot of preliminary 
work, but we never got to a point that I could exploit -- 
employ this total network. 

I managed to partially get there. I tried to get 
Hyde Park free and clear of any other activity, allocate that 
only to Middle East. To my surprise -- well, I should say to 
my surprise, CSF was not meant to be a company to deal with 
covert activities. 

The people did us a favor and they were handling 
at my request our accounting, but still, I noticed at the 
intervals that we looked at the accounting situation that 
monies were intermingled again. 

I could not implement the discipline that I wanted. 
I could not get the accountants to say, when I say G, allocate 
it to G, or I say H, allocate it to H, or F and so on. 
It never got off the ground to that point. 

So, Hyde Park was meant to deal with the Iranian 
affair. 

Q Now, you — 

MR. JANIS: There was a question probably about 
15 minutes ago — 

MR. NIELDS: That is all right. He has been giving 
us information. 



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BY MR. NIELDS: 
Q Mr. Hakim, on -- first of all, I want to ask you, 
we have now at least mentioned the questions and answers, 
Udall, ToyCo, Lake Resources, Hyde Park, Gulf, Energy, Dolmy, 
Defex and Albon, Albon Values. 

Were ther*" any other bank accounts or companies that 
were in any way at all related to the arms sales to Iran or 
the support of the contras? 
A Yes. 
Q What? 

A I believe I have given you the list of those companies 
in Paris. You have a listing of that, those companies. 

MR. JANIS: For the record, I think he identified I 
a number of companies. | 

MR. NIELDS: He did, he identified additional companie 

MR. JANIS: And the bank accounts. 

MR. NIELDS: I better get the bank accounts, because 
I an not certain of that. ! 

MR. JANIS: Do you want me to give them to you? 

MR. NIELDS: Yes. 

MR. JANIS: The additional bank accounts he identified] 
were in Energy Resources bank account at Societe Bank Suisse, 
SBS, and a — we have talked about Defex SAUBS and he also 

identified an account, Stanford Technology Corporation Services, 

» 
SA, Frfbourg, at the Trade Deyelojinftn^ £cink in Geneva. 



the Trade Deyelqpm^p^ ^i 

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MR. NIELDS: Do we have those records? 
MR. JANIS: You have those records. 
Let's go off the record. 
(Discussion off the record.) 

MR. NIELDS: On most of the accounts, the signatories 
are people you have identified earlier in this deposition as 
being employees or associates of CSF, but there are some 
signatories on the Gulf Marking account that I want to ask 
you about. 

MR. JANIS: Do you have the documents? 
MR. NIELDS: Yes. 
BY MR. NIELDS: 
Q There are signatories named Sebastian Criscione and 
Marie-Noelle Eggertswyler . Who are they? 
MR. JANIS: If you know. 

THE WITNESS: I don't know who these people are, but 
if you have the corporate records, probably they are shown as 
the directors of the company. 

That is the only logical way that they would appear 
on the bank accounts. 

BY MR. NIELDS: 
Q Are these people who live in Liberia? 
A Probably. I don't know. 

MR. JANIS: Do you know. Off the record. 



(Discussion off t^l^ fif i'iB||*ffV 



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1 BY MR. NIELDS: 

2 Q Are you aware of any arrangement on any Gulf Marketing 

3 account pursuant to which there was a joint Tii n^nnj-nry 

4 arrangement with principals of Defex? 

5 A Well — 

6 MR. JANIS: You are talking of principals of Defex 

7 Portugal? 

8 MR. NIELDS: Defex Portugal. 

9 THE WITNESS: It rings a bell. 
MR. NIELDS: What was the purpose of that? 
MR. JANIS; Could you repeat that question again? 

I want to be sure I understand it. 

(Record read by the reporter.) 

^* MR. JANIS: If you know. 

^^ THE WITNESS: The lead that I am going to take from 

the question that you have asked is a joint account with Defex. 
I cannot remember whether it had to do with Gulf or any other 
banking arrangement, but I recall a transaction that 
again, because of my concern in connection with the payment 
in advance for the arms that we had not received, I accepted 
or I came up with a suggestion which I don't know if it ever 
got off the ground, that gave signatory power to an account 
that both Dr. Garnel and Tom Clines had signatory power that 
once Tom Clines was satisfied, that the goods -- it was some 
sort of an arrannMa*n<^[Iii|n<ym f MriWMiccount in our terminolog 



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UNCUSSIFIED 



1 But it was done with Gulf Marketing or else I cannot 

2 answer, but that portion that I told you, I remember something, 

3 but I believe that never also never got off the ground. I 

4 believe it ended up with a different arrangement in London. 

5 There should be a transaction in connection with 

6 Portugal or Defex happening in London. 

7 BY MR. NIELDS: 

8 Q But you think this joint signatory arrangement 

9 may have been worked out with respect to an account that no 
money was ever put in, is that what you are saying? 

1' A That -- 

'* (Witness conferring with counsel.) 

BY MR. NIELDS: 

Q You provided us with a signature card for a Gulf 
Marketing account, and the signatories on the signature card 
are Sebastian Criscione, Marie-Noelle Eggertswyler, Jose 
Garnel and Marcelina Leal. Maybe that is Marcelina Greta Leal. 
I think it probably is. 

A That is a Defex employee, Marcelina Leal. 

Q Yes. 

A I think my earlier testimony is reasonably accurate. 
Those people signed the signature card, and Tom Clines was 
given — was empowered to call and have one of the CSF people 
to sign when the even^^t^o^l^ P^^tf rftl*iiF*f%^ ^^^ money, but 
he never used it. 



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Q L|(j>^Say one of the CSF people, presumably you are 
referring to Criscione and Eggerstwyler? 

A I think so. 

MR. JANIS: May we go off the record again? 
(Discussion off the record.) 
MR. NIELDS: Let's go back on the record. 
BY MR. NIELDS: 

Q Returning to the chart which is page C-16 of the 
Tower Board report, it depicts various bank accounts. It onuts 
the Energy Resources account, which I take it was no longer 
being used in 1986. 

A It was not supposed to be used, but -- 

Q It also omits the Defex UBS account, which I take it 
had served its purpose by some time in 1986? 

A Yes, correct. 

Q And it omits the Stanford Technology account . Did 
that continue to serve any purpose in 1986? 

A Stanford Technology Service — is that what it is? 

Q Yes, Fribourg. 

A No, that continued to remain — that was — if I am 
not mistaken, that is a Swiss company, and'used that to establi 
an American Express account, so we could use the American 
Express again in line with my effort to try to bring discipline 
into all this bookkeeping. 

We wanted to start using credit cards. We could not 



inted to start using cred 

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do that with a Panamanian company, so we, I believe, used that 
MR. JANIS: Do you have a question? 

MR. NIELDS: Yes, I think he wants to ask a question 
of Mr. Hakim. Are you testifying just now about Stantech 
Services, SA, or are you testifying about Stanford 
Technology Corporation, SA? 

THE WITNESS: I am talking about the company, 
Stanford Technology Services, SA — 

MR. JANIS: No, no. Just read this. 
THE WITNESS: In connection with the American Expres 
credit card I am talking about, account number ^^^^^H of 
Stanford Technology Corporation Services, SA, Fribourg, at 
Trade Development Bank, Geneva. The reason we used 
Trade Development Bank, Geneva, is because one of them bought 
the other one. Either — 
BY MR. NIELDS: 
Q All right. My question is, why is Stanford 
Technology Corporation, SA, not on the chart of accounts which 
is page C-16 of the Tower report? 

A That didn't come as part of the structure that 
company — I don't have the date that this company was 
incorporated. If you can give me that date, I may be able to 
help you. 

Q January 30, 1976. 

A Okay, so it was ^ ^xij^'^ing^jcompany that I had for 



so It was an exist ing C( 



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my previous activities, so it was there, and we used it. 

As I testified just a minute ago, we needed to have 
a Swiss company. It was a dormant company that we had. It was 
Swiss. 

So, we used it for that purpose. 
Q And so, Stanford Technology Corporation was set up foi 
a limited purpose -- excuse me, not set up, but -- 

MR. JANIS: No, no, you got to be careful with these 
names, because they are confusing, Stanford Technology 
Corporation and Stanford Technology Corporation Services, SA,a.« 
two completely different entities. 

MR. NIELDS: Well, I think there are three. 

MR. JANIS: There are probably more than that. But 
Stanford Technology Corporation Services is what we are talking 
about. 

THE WITNESS: What I am testifying, now that you have 
given me the date of the incorporation, during the time that I 
was living in Switzerland and I was dealing with Stanford 
Technology SA, the earlier part of my testimony, I had this 
company as well, because we had some difficulty with someone, 
a gentleman called Mr. Stanford, and he didn't like to see that 
ncune — I won't go into that. 

So, I formed a company, Stanford Technology 

Services, and it was there, dormant, we didn't use it. When it 

^^Q. c.ewcy 
came time that we needed to use credit cards to create e f fici ef 

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I used that company. It was not part of the chart. It had 

to be a Swiss company to get credibility with the banks. 

We could not use a Panamanian company and get a credit card. 

MR. NIELDS: Let's go off the record. 

(Discussion off the record.) 

MR. NIELDS: Back on the record. 

I want to ask you, there are signature cards on the 
Hyde Square account for someone named Jones and someone named 

Barnett. 

MR. JANIS: Can we see them? 

MR. NIELDS: Yes, you may. Daniel Jones, and Burt 

Bartlett. 

MR. JANIS: Is this the whole thing? I don't want 

to look in your private papers here. 

MR. NIELDS: You can look at anything you want. It 

all came from you. 

MR. JANIS: Are these -- let's go off the record 

for a second. 

(Discussion off the record.) 

MR. JANIS: Before you answer that, having looked at 
those records, I am not sure that the records you showed Mr. 
Hakim are actually bank signature cards. They appear as if the 
might be corporate papers and not bank signature cards. 

DO you know who those people are? In any event, you 
want to know if he knows who they are? 

iiftiAi innirirn 



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MR. NIELDS: Yes, regardless, do you know who those 
people are, Mr. Hakim? 

THE WITNESS: No, I don't. No. 
BY MR. NIELDS: 
Q I want to stay with this chart C-16, there is a 
column for Africa. What is the reason for that? 

A Jokingly, one day I believe General Secord said that, 
who knows, if we do a good job, the President may send us to 
Angola. 

I said, at the rate these people have been going in 
coming up with so many surprises, I would not be surprised 
if they indeed did that. And I didn't want to have the burden 
of running around doing too many things at the same time, like 
I was, so I said, let me go ahead and form another — not form 
the company, but have it ready, discipline the people; if indeec 
it would happen, I would just plug in a company in there and go 
ahead with it. 

Just further foresight on my part. 
Q When was the conversation? 

A I am sure prior to ray creation of this organization 
chart. I really don't remember when they were joking about it. 
I think it was in the context that something had gone wrong and 
we read something in the newspaper. I 

There must have been an ARCO report on Angola and 
Richard joked about it. In my mind, I said, you know, the way 



I 



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this crazy thing is going, they might do that. 

Q A minute ago, you referred to, you said you didn't 
remember when they joked about it. Who else was joking about it 
About Angola? 

A I don't know. I believe when it happened, we were m 
STTGI offices in Vienna. It is possible that — I think Mr. 
Dutton was there, too. It is such a long time now, when we read 
the newspaper, there was something wrong and he said, well, who 
knows, they may ask us to do Angola, and it stayed in my mind. 

Q Was there anything more said about Angola than that? 

A No. 

Q To the best of your recollection, when did you 
create this chart? 

A To the best of my recollection, I think it occurred 
when I felt that we have an enterprise that is going to stay 
alive for more than one day, and that occurred when the Iranian 
initiative was getting organized, so if we started with the 
Iranian initiative sometime in February 1986, I would say 
mid-1986. That is a guess on my part. 

Q That means summer of 1986? 
Could be. 
Is that — 
That is reasonable. 
Is that your best recollection? 



That is my best recollection. I did not feel 



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comfortable, Mr. Nields, that we had a company that could 
sustain itself and stay on its own feet and go on until the 
Iranian initiative started to move along. 

And then I saw the need to put some order in 
our activities and start with a better accounting, better 
bookkeeping, better allocation, so I thought it was about 
time for us to get professional. 

Q Do you associate it at all with the time when you 
began on what is referred to as the second channel? 

A Could be. Could be. We started with the second 
channel — I started with my search, we met the so-called 
relative and I wished to God that they would stop using 
the word relative on TV, in August, so I — I must have 
started with my efforts to contact my Iranian contacts in 
June- July to be successful in August, so that could be. 
That could be the right time. 

Q The money that was paid for the arms sold to Iran 
went into Lake Resources with the exception of the last 
shipment. That money went into Hyde Park Square. 

A Yes. 

Q Now, I guess I have two questions. That means the 
last money that was taken into Lake Resources which related to 
the Iranian arms transactions was in May of 1986, and the — 
MR. JANIS: Is that it? 
MR. NIELDS: I haven't finished the question. 



143 



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BY MR. NIELDS: 

Q the money that went into Hyde Park Square, which 

was the next transaction, was in October. Looking at your 
chart -- my first question is, looking at your chart, does that 
put a frame on when you made the chart, or not? 

A No, it doesn't, because Lake Resources existed for 
a long time before then, so the fact that money went to Lake 
Resources would not give me one end of the time spectrum. 

Q What I am suggesting -- let me sharpen my question 
and I am not trying to put words in your mouth — but you have 
placed Hyde Park Square on this chart as a Middle East company. 
A Yes. 

Q And I guess what I am asking is, is that tied in any 
way to the fact that it was used as the intake company for 
the last Iranian transaction? 

A It wasn't at all meant to be used for the intake 

company . 

Q That was my next question. 

A No, it wasn't. 

Q Well, does that ~ why not, if this chart was done 
prior to that time, why was Hyde Park Square used as the intake 

company? 

A Things changed in the second channel. During the 
course of our relationship with the people as you refer to the 
second channel crD«B%.wQ»a<i^«f#^rf:^*ie<-'0™e more professional 



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in our dealings, our financial dealings. We — I was sitting 
down talking to the people who had signatory power to sign 
checks . 

They actually handed out the check to me personally. 
Their English was not good enough, they gave me a bla</k check, 
I wrote in the figure in the check. It was a totally different 
relationship. It was no longer this Ghorbanifar, Khashoggi, 
Israelis -- all these had disappeared. It was a clean, 
straightforward relationship. We were talking with the 
real McCoys. They were sitting across the table from me. 

We were talking and so they handed out the check to 
me without a receipt. I didn't have to take it to the collectir 
company. It was a straight -- straight into where it had 
to go, into Hyde Park. The reason, as I mentioned, we used 
the collecting companies was to confuse the flow of the money. 

When you transact, they gave you a check, you are 
starting to deal — it was covert, but it was, you know, a 
professional covert activity. I didn't need to go through the 
zigrag. I deposited personally the check. 

Q Where did you — where was the chart prepared? 

A The chart was prepared in CSF. In the offices. 

Q By you? 

A Well, I drew up the structure, and then they used 
the printer and their computer to come up with the final form. 

Q Was there a secretary that typed it? 



i 



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Mtmim 



lis 



MR. JANIS: Let's go off the record for a second. 
MR. NIELDS: You want to go off the record and out 
of the room? 

MR. JANIS: Yes. 

MR. NIELDS: That is really off the record. 
(Discussion off the record.) 
THE WITNESS: Yes, sir. 

MR. NIELDS: Do we have a question pending? 
THE WITNESS: I understand you asked me if there 
was a secretary who did this? 
BY MR. NIELDS: 
Q Yes. 

A I tried to work with the tools that I had. I -- the 
person that I trusted to discuss these with was the sonf of 
Mrs. Zucker — 

Q I take it that is Eric Zucker? 

A That is Eric. He had time off, and I used his 
services and paid him separately to bring in order in this and 
he printed that with their printer using their computer. 
Q How did that chart get into Mr. North's files? 
MR. JANIS: If you know. 

THE WITNESS: I don't know. I did supply a copy of 
this to Mr. Secord. I don't know how it got to Mr. North's 
file. I have no idea. 



UNCLASSIRED 



146 



ilNCLASSIHED 



116 



BY MR. NIELDS: 
Q Were there other additions or versions of that chart? 
A Not within my system as far as I remember. 
Q Now, my — is this a complete chart? 
A Yes. 

Q What is the significance of the letter "R"? 
A Reserve. 

MR. JANIS: For the record, Mr. Nields, you are 
pointing to the block that says CSF Investments, Limited, R. 
MR. NIELDS: Correct. 

THE WI'^NESS: That is where I put the — what I 
refer to as reserved money. Upon my return to the United 
States I watched the video tapes of General Secord ' s testimony. 
He refers to them as CDs. There was no such thing as CDs, 
cash certificates of deposit. It was an investment in CFS 
Investment. I referred to it as reserve. The reserve to me 
meant monies that technically should have been set aside 
and not to be used for operational purposes. 

That was used for insurance. It was used for — 
BY MR. NIELDS: 
Q I want to be absolutely sure I understand what you 
are saying about CSF. Are you saying that that "R" stands 



for reserve on that chart? 



Are you certain of that 



inmim 



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117 



A That is why I put it there. I put that "R" in 
there. 

Q I just note that there is an "A", a "B", a "C" , 
all in the upper right-hand corner of each box, a "D", "E" 
and "F" and a "G" and "H" and "I", and then -- 

A Then we go to "R". 

Q Those letters don't stand for words that begin with 
"A" or begin with "B" or "C", I take it.? 

A No. 

Q That is just an alphabetical listing. Are you 
saying "R" is not an alphabetical listing? 

A Youf are right. That is correct. 

Q I am going to put in front of you, Mr. Hakim, 
what we have been referring to as the ledger. Do you also 
refer to it as the ledger? 

A These are the documents that I supplied or this is 
your worksheets? 

Q Yes, you supplied us with these documents. As you 
can see, they bear your consecutive numbering system from 
page 957 through page 1146. You may peruse them if you 
wish before answering my question. 

MR. JANIS: When you say "your consecutive numbering 
system", those are numbers that were put on by the committee? 
MR. NIELDS: No. They 
MR. JANI S: H-957? 



ICUSSIFIED 



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MR. NIELDS: Maybe they were put on by us. I am 
sorry. They were put on by us. I beg your pardon. 

THE WITNESS: I have looked at the documents, 
Mr. Nields, can you please repeat your question. 
BY MR. NIELDS: 
Q Well, I had asked just a very tiny question to 
begin with, which is whether you also called that the ledger. 
A I didn't call it any names. 

Q Let's call it -- it is not a bad name — let's call 
it ledger from now on, okay? 
A I have no problem. 

Q What does the ledger, and by that I mean all of the 
documents that I put in front of you — 
A In this binding. 

Q In that binder, yes, extending from H-957 to H-1146. 
What does that represent? 

A These documents, to the best of my knowledge, 
have been produced as the result of the work of my attorneys 
and the accountants that they employed. 

MR. JANIS: No, let's go off the record. 
(Discussion off the record.) 

THE WITNESS: I want to clarify one point that — 
when I defer to my lawyers, I continue to include Mr/. Zucker 
still as my lawyer. 

I believe these are the documents that were prepared 

iium looiricn 



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I had not seen these before. I believe these are the 
computer printouts that his organization produced for the 
purpose of giving it to you. 

BY MR. NIELDS: i 

Q Well, I want to get to that in a minute, but my 
first question is simply what do they represent? What do 
they purport to -- see if I can ask the question in a way 
that is easier to understand. 

There are a number of financial transactions 
reflected in the ledger. 

A Correct. 

Q What is this — what category of financial 
transactions is this ledger supposed to cover? 

A It shows debits, credit, and balances. 

Q Yes, but with respect to what kind of transactions? 

A This first page refers to — 

Q Let me withdraw it and ask you another way. Is 
this ledger designed to cover all of the Iranian arms 
transactions and all the tremsactions relating to the support 
of the contras that you and Mr. Secord engaged in? 

MR. JANIS: Do you want to take a minute to look at 
them? 

THE WITNESS: May I take a moment and look at these, 



please? 



MR. NIELDS: Yes. 



UNCUSSIFIED 



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(Discussion off the record.) 

MR. NIELDS: Shall we go back on the record? 
Is there a question pending? 

(Whereupon, the reporter read the pending question.) 
MR. JANIS: If you know. 

MR. HAKIM: Mr. Nields, I have not seen these records 
before. I have not examined them, but if the result of 
all these transactions shown in this so-called ledger would be 
the same as what I testified to during my Paris testimony 
when I gave you the inputs and ouputs in all the accounts 
and then the answer to your question is yes. 
BY MR. NIELDS: 
Q Well, that document that you are holding in your 
hand and testifying about was produced by you to these two 
committees in Paris. You are aware of that? 
A Yes, sir, I am. 

Q And that was produced, I take it, at your direction? 
A Correct. 

Q And it was produced because it relates to the receipt 
of contributions for the Nicaragusm resistance and the 
proceeds of sales of U.S. arms to Iran? 
A Yes. 

Q And it is a document, I take it, which purports to 
account for how those monies were spent? 
A Yes. 



I 



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121 



Q And it was, I take it, prepared by your agents? 

A Yes. 

Q And those are people at CSF? 

A That is also correct. 

e 

Q And I will state that we have reviwed this ledger. 
It appears to account in one way or another for all of the 
monies received into the bank accounts that you have testified 
about and that you have produced the records of to these 
committees? 

A Yes, sir. 

Q And I take it you have no knowledge inconsistent 
with that and you believe indeed that that ledger does 
account for all those monies in one way or another? 

A In that context, yes. 

Q And you are not aware of any bank accounts which 
you have not produced to these committees which relate in 
any way to the receipt or disbursement of monies contributed 
for the Nicaraguan resistance or monies received from the 
sale of arms to Iran? 

A Not that I am aware of. 

Q Now, what I would like to do is — this time I am 
going to mark this as Exhibit 1 to this deposition. 

(Whereupon, the document referred to 
was marked for identification as 
Hakim Exhibit 1.) 



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BY MR. NIELDS: 

Q Mr. Hakim, I am pu-tting in front of you a document 
which has been marked Deposition Exhibit number one, and it 
consists of some pages out of the ledger which you have 
just finished testifying about. 

A Yes, sir. 

Q I would like you to address yourself first to the 
first page and it is a page that is numbered H-957 and it says 
up at the top left, "capital invested". Below that it says 
"capital invested, total group". What does "capital 
invested" refer to? 

A I don't know what the accountant/bookkeeper had in 
mind by that terminology. 

Q Well, there is a — down below there are a list of 
five names, Albert Hakim, Korel Assets, C. Tea, Scitech 
and Button. 

Now, you have told us what C. Tea denotes? 

A Yes, sir. 

Q That is Tom Clines; is that correct? 

A Yes. 

Q And did he receive some — I think you have 
already testfied that he did — receive some profits in 
effect, commissions out of the transactions? 

A That is correct. 

Q And they were put in a capital account under the 



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name C. Tea? 

A Yes. 

Q And this document on its face relates to capital 
and then underneath it has C. Tea and an amount of money. 
Is that an amount of money put into C. Tea, that is, 
Tom Clines, capital account? 
A It should. 

Q Okay. Now, then there is at the top, it says 
"Albert Hakim" ~ that is you, I take it? 
A That is right. 

Q Now, is this, the numbers opposite that 
represent your capital account? 

A After they put everything together and show that under 
my name — in other words the original arrangement had the 
box that we referred to earlier as reserve — that has been 
combined with everything else in here and has been shown under 
my name. 
Q 

What "is^Korel Assets refer to? 
A Korel Assets was again a situation that I had 
an existing company for a different purpose and I used it to 
collect or keep the portion of the commission that was 
supposed to go to General Secord. That was the intent of it. 
Q How about Button? 
A That was set aside some time back from the monies 



Okay. Let's see if we can come back to that. 



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that we could afford to set aside for death benefits. 

Q Why was the word Button used? 

A Most of these things came about as a joke or 
something like that. I believe something button-up or 
something, I don't recall now. 

Q Well, bellybutton is the word that appears in 
handwritten ink on one of the documents that you turned over 
to us. 

A That could be bellybutton, yes. 

Q What does that have to do with death benefits? 

A No, you know, probably wiggle and touch somebody '5 
bellybutton. I don't remember now. It has been such a long 
time. 

Q All right. What kind of death benefits was this 
set aside for? 

A If I had the dates, I probably could help you better. 

Q May 20, 1986. 

A May 20, that was when this thing started? 

Q That was when the $200,000 was put into the 
capital account in the name of Button. 

A It should — that is probably one we got organized. ■ 
This money should have been set aside earlier having to do with 
the contras. So I don't know why the — May 1976 — 

Q 1986. 

A 1986. It was one of the reserve accounts for death 



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benefits. How we got to that at that date, I don't recall. 

Q Why is there a reserve account for death benefits 
listed as one of the five capital accounts? 

A It was bearing interest for the benefit of the 
pilots and so on that — we set that sum of money aside and 
left it, bear its own interest and benefit for that purpose, 
for the account of those people. We didn't want -- 

Q Why was it put in a capital account? 

A Like I said, we did not want to benefit from the 
income and interest of the money that we had set aside for 
that. It should be allocation of interest to this, I am 
surprised that it is not. Maybe we started out with less 
money and that was the total then, I don't know. But the 
intention was it should be an interest bearing account. 

Q Why wouldn't it be a reserve for expenses rather than 
a capital account? 

A For expenses you didn't need reserves. The monies 
we should not have spent we always set aside in a capital 
account. 

MR. JANIS: Mr. Nields, I have a question. Maybe I 
misunderstood you. 

Did you indicate that Button was deposited on May 12, 



1986? 



UNCLASSflED 



MR. NIELDS: May 20. 

MR. JANIS: The first page of the Exhibit 1 says 



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trial balance from January 1, 1984 to April 12, 1986. That woul 
purport to enclose a month before you said that the Button 
deposit was made. 

THE WITNESS: My testimony was that I was surprised. 
It should have been earlier. 

BY MR. NIELDS: 
Q Turn to the second to the last page of the exhibit. 

MR. JANIS: The second to the last page of the 
exhibit, H-970? 

MR. NIELDS: H-97 0, upper left corner, the numbers 
"20" and "5". 

MR. JANIS: At the very top it says again from 
January 1, 1984 to April 12, 1986. 

MR. NIELDS: Do you see the "20" and the "5"? 

MR. JANIS: I see that now. 

MR. NIELDS: Okay. Would that denote the 20th day of 
May? 

MR. WECHSLER: It doesn't have a year, though, 
does it? 

MR. NIELDS: We will get to that. 

MR. JANIS: The document is labeled to April 12th, 
1986. 

MR. NIELDS: Wait a minute. You are using American 
dating. This is European dating and it_ is the fourth day of 
December 1986. Isn't that right? 



t IS the tourtn day or 

UNCLASSIFIED 



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BHWSSm 



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MR. JANIS: I don't know if that is how they did it. 
You write normally on a Swiss document, it is run this way, 
but this is -- 

MR. NIELDS: All of this, look at the left-hand 
columns of it. They are all done with the day first and 
month second. 

MR. JANIS: So you mean this is from January 1, 
1984 to December 4, 1986. 

MR. NIELDS: Precisely, and you will notice there are 
numerous entries long past April 1986 on the capital 
accounts. I have just put in front of Mr. Hakim a wire 
transfer of $200,000 on May 20, 1986, and you will find another 
reference unambiguously 1986 on page 962 of Exhibit 1, 
H-962 of Exhibit 1. 

MR. JANIS: I think you are right. 
MR. NIELDS: 25 CSF investment rate. Button, 
$200,000. If you look at the entries before you will see that 
it is 1986, the year is written up above it. 
MR. JANIS: Yes. 

MR. HAKIM: The instructions that I had given, 
Mr. Nields, to CSF to set that money aside was not in 1986. 
It was a long time before that. 
_- BY MR. NIELDS: 
11 Q That is why I want to ask you about this transaction. 

I take it what you are saying is that much earlier than that 



158 



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you suggested that they set some money aside for 
death benefits? 

A And it should bear interest and have its own 
income . 

Q Fine. But what I am asking you now is about a 
different transaction which is the one in May, May 1984. 

A Yes, sir. 

Q Now, I want to know what that transaction related 
to. 

A I don't believe this is any different than that. 
However, my assumption is that CSF until 1986 when I started 
to really get into trying to organize things, did not carry out 
my instructions and kept everything intermingled and when I 
started to look at the accounts and ask them where is what and 
I noticed that they did not do it, and that is when they 
effected my instructions. 

Q Let's take this in pieces now. Are you saying that 
you of your own memory know that Button refers to insurance? 
(Witness conferring with lawyer.) 

THE WITNESS: What I remember, Mr. Nields, is that 
at a time much earlier I told CSF to set aside monies for 
death benefit. When we gave the name Button to this, I don't 
remember that date. 

BY MR. NIELDS: 

Do you remember — you are saying, Mr. Hakim, that 



m 



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you remembered that the word "Button" was applied to death 
benefits? 

A That was my instructions. 

Q You instructed them to apply tha word "Button" to 
death benefits? 

A Yes. 

Q And you are saying that you remember that? 

A I — that is correct. 

Q So you are not — this isn't just guesswork. You are 
testifying that Button refers to death benefits? 

A That was my — I am saying that 1 told them, where 
is the $200,000? And they asked me under what account do you 
want it, to keep it, and I said "Button". 

Q Okay. Now, what was your reasoning for using the 
word "Button"? 

A If I am not mistaken, it came about as the result of 
the terminology that Mr. Zucker used saying in the meeting that 
I had with him, he talked about a wiggling, touching, 
bellybutton, that is how it came about. He came up with 
the verbiage and I said why don't we use "Button" for that 
purpose. 

Q What does wiggling and touching bellybuttons have to 
do with death benefits? 

A I think it had to do with the family of the possible 

-^ 
victims that somebody had to wiggle their bellybuttons. I t-trm- 



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that is how it came about. It does not — unlike, for instance, 
C. Tea doesn't represent a name. Is that what you are trying 
to discover? 

It is not referring to anyone's name. 

Q You are saying that now? 

A Yes. I am saying that this does not refer to anyone's 
name. For instance, C. Tea, it was a reversed arrangement of 
Tom Clines. This came about as a result of the discussion 
that I had with Mr. Zucker and had to do with the family of 
the possible victims that we needed to touch — I don't 
remember the verbiage that we used, I said somebody needs to 
go and wiggle the bellybutton of the fcimilies, the wife, the 
kids, and I said, "Button". 

Q Can you think of a person whose name this could be 
in the same way that C. Tea is Tom Clines? 

A No, I don't. 

Q You ccui't think of anybody? 

A No. 

MR. JANIS: Do you want to suggest somebody? 
MR. JANIS: Yes. I think it is fairly obvious. 
I suspect Mr. Hakim has already thought of it. It is 
Mr. Dutton's name with his first initial on the beginning of 
it, "Button". 

THE WITNESS: Absolutely not. No. 



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BY MR. NIELDS: 
Q And put in the capital account twenty days after he 

started working. 

A Absolutely not. I testified that this does not 

represent — 

Q I understand that. You have already testified to 

that. 

A No, no, definitely not. 

Q What does SciTech refer to? 

A SciTech refers to an image echo of Stanford 
Technology Trading Group. If you look at the complete 

name — 

Q Whose capital account is this? 

A This would be — this is what I am testifying. It is 
a reflection of Stanford Technology Trading Group outside 
of the United States. 

Q I see. 

A If you look at — 

Q Are you saying that this capital — this means 
that Stanford Technology is credited with this amount of 

money? 

A What I am — I am explaining to you what the name of 

the capital account means. 
Q Okay, 
A As far as the bookkeeping and the accounting is 



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concerned, we have to deal with that separately. 

Q All right. 

A I am first explaining SciTech, I believe it has -- 
that is not the complete name. It is trading group or 
something after that. If you take the initials of this 
company's name , it will be identical to STTGI in the United 
States, SciTech Trading Group International. 

And the reason for choosing that name was that as we 
get into this further I expected at one point to spin my 
activities off and get out of the politico-military 
intelligence part of the Iranian initiative and start with 
what I referred to as the joint venture with Iranians and I 
wanted to use SciTech for that purpose. 

Q Okay. 

A As far as the allocation of money to this account 
is concerned, that requires examination. 

Q Pardon? 

A That requires further exeimination. 

Q Do you know what the — in other words, we have to 
look at the records to find out for whose benefit transfers 
into that account were made? 

A No, no, it was for the benefit of SciTech. 

Q Who were the beneficial owners of SciTech? 

A Well, the beneficial owners of SciTech, it was in 
my mind at all times myself and Mr. Secord. That is the way 

iiMcuMicicn 



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I looked at it. When I entered into these initiatives I was 
hoping that soon I would be able to achieve what I was 
employed to do and be able to spin off and get on with my 
business activities with the Iranians and I came up with 

e. 

the name SciTech to achive that. I expected for a long time to 
come we could not have an overt relationship with Iran and we 
had to continue with a covert relationship and I certainly 
did not want to continue to be part of the politico or 
military or intelligence part of that, so I established 
SciTech to do that. That was the entity that I intended to 
use for this spinoff. 

Q This, I take it, am I understanding you correctly, 
this is the entity that you planned to use to engage in non- 
military transactions with Iran once commerce with Iran 
was opened up? 

A Not quite so. The way I saw things going was that 
once the two governments could communicate with each other on 
the basis that both of them were satisfied they would not 
need my services of going between them, then I could start 
my relationship with the Iranicins to do business with Iran. 

It was — it did not have to necessarily to wait until 
the relationship was formalized. I didn't expect that to 
happen that quickly. But I did intend to benefit from the — 

Q — from your involvement in the covert relationship? 

A Right. 



UNCUSSIFIED 



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NniiiisiFiD 



Q Who is Keith Phillips? 

A Keith Phillips was a gentleman that Mr. Secord 
employed as a consultant. I believe he was living in Saudi 
at that time and he was used to pursue the shelter project 
that I earlier mentioned as one of our early projects 
that we accepted to do on behalf of Marais International. 
He was there and following that and he was following that up 
on our behalf. 

Q Did or does Keith Phillips have anything to do with 
SciTech? 

A You mean owning stock or anything as such? 

Q Does he have a beneficial interest in it or did 
he work for it and get compensated for his work? 

A The idea was for him to get paid out of SciTech 
because we — it was a very strange situation. It was a 
situation that total resources of STTGI was effectively used 
for this covert activity and then at the same time 
Mr. Secord and I did everything possible not to get STTGI 
involved with this covert activity. We were not quite success- 
ful to achieve that. Things got sloppy and messy. Like I 
mentioned earlier, we created a shadow of STTIGI outside of the 
United States to do what STTGI should be doing without putting 
any taint of the covert activity on STTGI in the United States 
and that is why the creation of this SciTech. 

Q 



I don't understand your answer. You 



the question 



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was -- you said that Keith Phillips was to be paid out of 
SciTech. 

A And was. 

Q And was paid out of SciTech. 

A To the best of my kno--ledge, instructions were given 

uias 

that Keith Phillips weire to be paid out of SciTech. 

Q Was Keith Phillips being paid for work that he was 
doing for STTGI? 

A Correct. 

Q Are you saying that that was done as a way of 
compensating STTGI for the fact that its resources had been 
used in furtherance of the covert operation? 

A That is right. 

Q Is that what you are saying? 

A That is what I am saying. We had no other source 
of income for STTGI except the covert activity. Our total 
system was consumed by the covert activity. 

Q Okay. 

A We needed to keep it alive. 

Q I want to get back to that, but let me switch back 
to the Albert Hakim part of this ledger. 

Q What does the $6,800,000 represent in your 
capital account? Is that your money? 

A There are two questions in there. 

Q Let me withdraw the first one and ask you the second 

ijiim Aooinrn 



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one first. Is that your money? 

A That is a very, very difficult question to answer, 
Mr. Nields. Very difficult. 

Q Let me withdraw the question and ask it a slightly 
different way. 

Was it put into your account on the belief and 
intention that it was your money? 

A Part of this, as I testified earlier, was put in 
the account called the reserve with CSF Investment. When 
the covert activity was terminated and it no longer existed, 
the best place that I could park this money was under my name 
and so the remainder of all the capital accounts outside 
of those that were already allocated went under my name to 
be held on my behalf. 

(Witness conferring with counsel.) 
THE WITNESS: If you refer to some of the other 
documents you should see different categories of A.H, there 
is A.H., A.H.-l, A.H. -2, A.H. -3. When I said a combination of 
different accounts put under one umbrella, under my name, 
that is what I am referring to. There should be a document 
someplace amongst the documents that I gave you thatihas 
annotation H-1, 2, 3, and so on. 
BY MR. NIELDS: 

Q I don't know what you mean for sure, Mr. Hakim. 



IINCIASSIHED 

25 II we will go through those document 



^ and find them. 



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There are references in your individual capital account 
ledger to "I's" and "2's" and "3's", some of them are just 
"1", "2", "3", some have phase "1", "2", "3", and I will 
get back to that, but I want to understand your answer first. 

MR. JANIS: Just so -- I don't mean to interrupt 
your examination, but by way of example, you see on page 
H-965, May 21, there is a notation that says "CSF Investment, 
A.H. sub-account 1." 

MR. NIELDS: I see that. I was looking atithat 
a moment ago. 

THE WITNESS: That is different. 

MR. NIELDS: We will search for those in a minute, 
but I would like to understand Mr. Hakim's answer first. 
What is the answer to the question whether the $6,883,000 
was transferred to your capital account on the belief 
and intention that it was yours? 

MR. JANIS: Do you understand the question? 

MR. NIELDS: I think he does. 

(Witness conferring with his lawyer.) 

THE WITNESS: Mr. Nields, do I understand that the 

asK'^') 

question that you are a«Eflg in simple English means that if 
this was meant to be my profit? Is that what you are asking? 
BY MR. NIELDS: 
Q That is a good question and now that you have 
expressed that question I would like to hear the answer to it. 



t question I would likg. t 



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No. 



Was any part of it your profit? 

Yes. 

And what part of it was your profit? 

But that needs a lot of work. 

I don't mean the number. I mean the concept. 

But this -- First of all, they added these number 
of accounts, A.H.-l, 2, 3, 4, that they should not have. 
These were not my instructions. I don't know why they 
mixed apples and oranges together. Notwithstanding that, 
it is very difficult to answer that question. You are 
asking for a formula of how this thing should have been 
divided to show what my profit would have been, is that what 
you are asking? 

Q Well, I take it there was some money that should 
have been transferred to your account because it was your 
share of the profits? 

Would you answer that? 
A The only certain thing that was defined had to do 
with the commission on the sales of arms for the benefit of 
the contras. If the accounting would show that there are 
monies from those commissions that I did not draw and they are 
part of this 6.883 million dollars that definitely should 
be classified as my profit or part of the profit left that 
I did not draw Swvw y^e IT nc ^ %i^a ^ W" h ° sales of the contras. 



iTHi*i mmtti 



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139 



MR. JANIS: It is unclear to us, I believe, whether 
the 6.883 million includes the amount that he drew as his 
profit. Just looking at the document I can't tell that. At 
least not sitting here. But there was -- I can't tell whether 
some portion of this 6.883 million is supposed to be his 
portion of the profits included in this 6.883 million. Maybe 
you could help us by phrasing your question so that we 
understand if that is what your understanding is. I am not 
explaining it very articulately, but — 

MR. NIELDS: No. But I understand what you are saying 
It is, I think, fair to say from our review of the records 
that this number, 6.883 million, reflects all of the money 
that is not given to Mr. Hakim as an expense of the 
enterprise and therefore it is logical to believe that it 
includes whatever profits he was entitled to. 

THE WITNESS: Includes a mixture. It is a fruit 
salad. 

BY MR. NIELDS: 
Q Tell us, besides the profits that you say you 
are entitled to for the sales of arms •i«*^-4iO contras, what 
other monies are included in your capital account and why? 
A There are expenses that are unpaid to this date. 
I can give you by way of example. We have not paid — 

MR. JANIS: I don't think you understood his question. 

THE WITNESS: Expenses, any expenses you have to 

im ni jinniririL 



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UNCLASSIHED 



140 



pay out of this. 

MR. JANIS: He is not asking what liabilities there 
are. He is asking you to the extent that monies are 
attributed in this capital account, you indicated and he 
agreed some portion of this was your profit, putting aside 
what has to be paid in debts, what other elements make 
up this figure. Is that correct, Mr. Nields? 

MR. NIELDS: Yes. 

THE WITNESS: Additional profits for me. 

MR. JANIS: No, no. 

THE WITNESS: I don't understand the question. 

MR. NIELDS: Well, let's go to — 

MR. JANIS: Give me a second, John. 

(Witness conferring with his lawyer.) 

THE WITNESS: Mr. Nields, I have been under the 
impression that I have answered your question when I raised 
the point about A.H. and A.H. subtitle 1, 2, 3, 4. They all 
are indicating a purpose. 

BY MR. NIELDS: 
Q What were the purposes? 

A One of the A.H.'s represented the two million 
dollars reserve for self-insurance. Another A.H. represented 
another $2 million for reserve for another insurance. These 
are the monies that'^supposed to be used for these purposes, 
of self-insurance. 



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Then you have the ingredient of adding -- I don't 
know what else, my profit -- then you have taken care of the 
majority of the classification of the 6.8 million. The 
rest I have to look at the records to know what they are. 
I have been able to give you the explanation about most of it. 
I need to look at the reco^'ds to do that. 

Q We will do that together in a minute. But I think 
you mentioned four different categories. 

A To the best of my recollection, there should have 
been a A.H. account, and A.H.-l, A.H.-2, and if I am not 
mistaken, also a fl.H.-3. 

Q Now, is' the A.H. account your profit? 

A The A.H. account to the best of my recollection 
represented the account that I used to cover my expenses. 
It is sort of a current checking account, if you will. It 
was not a checking account, a regular expenditure account for 
personal use. 

Do I make myself clear? 

Q All right. That is a A.H. Then you have given a 
A.H.-l, which is two million, a A.H. -2 that is two million. 

A I am not sure those subtitles exactly correspond 
to that. 

Q I understand, but you have come up with four to the 
best of your recollection, four categories, A.H., A.H.-l, 
A.H. -2 and A.H. -3, 



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A Then there is possibly einother A.H. representing 
my savings from the profits. I don't recall. I simply 
have to refer to the files. 

Q Let's go back before we go to the details which 
we will do in a minute. Let's go back to the first page 
of Exhibit 1, again, and ask you what it represents. What do 
these capital accounts represent? 

A We talked about Albert Hakim. 

Q We have talked about it a little, but you have 
indicated that it does not represent profit. It may have 
included profit, but it doesn't represent profit. And you 
have said that it doesn't mean that — 

A You are looking for one terminology that can package 
this. 

Q Yes, and it says capital invested. What does that 
mean? 

A I would say that the best way to reflect that today 
is to call it the enterprise's money. That is the best way 
until we get a chance to all sit down and thoroughly examine 
it and look at it. That is the best way to classify it. 

Q I understand what you are saying, that perhaps 
legally it is the enterprise's money but I am asking on these 
records what is it about the monies here that add up to 
$9,785,000, what is it that they represented w^en th^y^ej 
put on this ledger as capital invested? 




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A I don't know what the intention of the bookkeeper 
was in preparing that. Why he put all these categories, 
added these things together^- he should not have added 
these together. He is just adding apples and oranges 
together. 

I have no idea why he summed these things up. 
You know, he says total group. Why he chose to come up with 
"group", I have no idea what he had in mind, what waahis 
preconceived notion that there was a group, so he is adding up. 
In my mind, he is just adding apples and oranges. They 
don't account for anything. 

I don't agree with this representation. 

Q Okay. I would like to turn to the sub-ledger 
on these capital accounts that is headed "Albert Hakim" . 

Before I do that — and I will do that in a minute — 
but I want to turn to the composite ledger which occurs 
between pages 959 and 962. 

A What were the pages? 

Q It goes from 959 to 962. I can tell you from 
studying it that this accounts for all the transactions 
that appear on all the individual ledgers under Albert Hakim, 
Korel Assets, C. Tea, SciTech, and Button. 

A Okay. 

Q Now, what I would like you to do is turn to page 961, 
and I am going to put something in front of you that may make 



174 



UNCLASSIFIED 



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CAS- 30 



this easier to follow. 

You can use the original ledger as you wish, but 
I think it is easier to see on this chart. 

MR. JANIS: John, can we go off the record a second? 

MR. NIELDS: Sure. 

(Discussion off the record.) 



WUSSIflEfl 



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1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

IB 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



MR. NIELDS: Back on the record. 
BY MR. NIELDS: 

Q There is a transaction that occurs on pages 961 and 
962 of the ledger and that you can see on a printout that I 
have put in front of you, that shows $26,490 credited to the 
Hakim capital account, $26,490 credited to the Korel capital 
account, $26,490 to the C. Tea capital account and 8833 
to the Scitech capital account. 

Now, that is a split of 30-30-30-10 percent of a 
total number. 

A Yes, sir. 

Q What does that represent? 

A I cannot be certain, but I believe it has to do with 
the sale or resale of weapons in connection with the contras, 
that our original arrangement with Mr. Clines changed. 

Q It changed to what? 

A One-third, one- third, one-third, after allocating 
some expenses to Scitech. 

Q When you say allocating some expenses to Scitech, 
I take it Scitech ends up getting a plus in its capital 
account? 

A Well, yes, you are correct, but when you reflect it 
back to STTGI in the States, then — that is what I meant. 
I am going back to the total picture. 

Q All right. Now, who were the three 30s? 



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2 

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5 

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A It is myself, set aside for General Secord, and Tom 
Clines. 

Q Now, below it, I believe this is the 2nd of June, 
there is a similar 30-30-30-10 split, $11,183, $11,183, 
$11,183 and $3,728. 

Wliat does that represent? 
A My answer would be the same. 

Q And then you will see above it on — I can't read 
upside down — it is around — 
A 79,167. 

Q Yes. What is the date there, June 3? $79,167, 
$79,167, $79,167 and $26,390. I take it your answer is the 
Seone on that? 
A Yes. 

MR. VAN CLEVE: The year on this is what? 
MR. NIELDS: '86. 
MR. JANIS: Just a moment. 
Okay. 

BY MR. NIELDS: 
Q At the bottom of the page, there is a figure of 
258,398, 258,398, 258,398 and 86,133. That is another 
30-30-30-10 split. 

Is your answer the same on that? 
A I would be very surprised if — I cannot recall a 
sale of, or a purchase -- depending how you look at it -- of 



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weapons for the contras , that the total commission is here 
what, about — 

Q 800-some thousand dollars. 

A $800,000. It is possible. It means that the total 
transaction had to be something around 2.5 million or a little 
bit more, to come up with a 30 percent commission. It could 
be. I don't know. 

If there is a transaction that 30 percent 
commission on that would total up to this 800-plus thousand 
dollars, then I am surprised why Mr. Clines is getting one- . 
third, because, to the best of my recollection, Mr. Clines -- 
it was either the last or the last two transactions that got 
one-third and he always received 20 percent, not 33 and a 
third. 

Until the last two or three transactions? 

Until the last one or two transactions. 

Okay. 

That needed extra effort. 

That is a late transaction. I think it is August 



Q 
A 
Q 
A 
Q 
of 1986. 



MR. WECHSLER: August 22, '86. 

MR. HAKIM: I don't know how you came to this 
one-third, one-third, one-third splice because — 

MR. JANIS: It really isn't a — it is not a 
one-third, one-third, one-third sclit. 



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MR. NIELDS: It is 30-30-30-10. 

MR. JANIS: But if the 10 is expenses — 

MR. NIELDS: If it is expenses, then it is one-third, 
one- third, one- third. 

MR. JANIS: Depending on how you assess it, if the 
IC is to Scitech, which is Hakim and Secord, then it is a 
70-30 split. 

MR. NIELDS: Unless it is to compensate Stanford 
Technology for expenses. 

MR. HAKIM: The part that I have a problem with is 
Tom Clines at that time having equal share as Richard and I. 
That is where my hesitation starts, that there is something 
off. 

BY MR. NIELDS: 
Q Did you think he had an equal share earlier? 
A No, no. Earlier, like I testified earlier, he had 
20 percent of the total commission or profit, whichever way you 
want to apply to it. 

Q What is your difficulty with the fact that he had 
30 percent later? 

A To the best of my recollection, it was only one, 
maximum two, transactions that he had equal share as Richard 
and I, unless there was a different agreement that I don't 
remember. 

I don't know whether I am helping you or not. What 



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I am saying is we have to go back and look at the transactions 
with Defex and the dates and see what we paid them, what was 
remained and how - we have to reconcile all this. We have 
to go back to the source and restructure all this. 

Q DO you recall a sale of arms that didn't eventually 
go to the contras but was purchased by the CIA? 

A I really don't know what happened to that. There 
was a time that we had paid and purchased, and we were even 
taking -- or we were threatened to pay for storage, that this 
was after it was decided that we no longer would continue with 
supply of weapons to the contras. 

I recall not quite clearly that we had been left with 
this shipment and, if we did not do something about it, we 
would lose it or we would -- I think what had happened, that 
we had a substantial down payment and all these things have to 
be really clearly identified by referring to the records. I 
am just talking from my memory, to the best of my 

recollection. 

I believe the last shipment we had made a 
substantial deposit and, if we had - if we would not take 
over the shipment and pay the balance of it by a certain time, 
we would lose our deposit. 

There was a discussion whether we should go ahead 
and pay the balance of this and give the shipment to the 
contras or the CIA. I was not involved with what was going on 



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1 between General Secord and CIA in transferring the assets, or 

2 buy it and resell it to another arms dealer. 

3 I know we had a problem with a shipment that 

4 occurred when we did not know where we stood with the 

5 Government as far as the contras were concerned, whether the 

6 CIA was going to take over, they were not going to take over. 

7 We were left with that problem to resolve and finally General 

8 Secord resolved it. 

9 A number of possibilities were discussed. I cannot 

10 recall which one of them was finally put into effect. 

11 Q Did you make money or lose money on the transaction? 

12 A That last transaction? One of the possibilities 

13 that we discussed was to resell it and make money. 

14 Q Did you? 

IB A If we did that, then we did. I don't remember. 

16 Like I testified, at this time I don't recall how General 

17 Secord handled that problem. 

18 One of the options was to pay and resell it. If we 
^9 did that — and if you recall, I earlier said — 

20 Q The records reflect that you sold these arms to the 

21 CIA for $1,200,000 in August or September — September. 

22 Did you contribute your commissions or profits on 

23 arms transactions before or after you received payment? 

24 A Without referring to the records I cannot tell you, 
2B Mr. Nields, because that period of time I was up to my 



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eyebrows with the second channel, very busy, and that is why 
I don't remember how it was finally settled. 

Q How about at an earlier point of time? We have now 
looked at four different transactions in which there were 
30-30-30-10 splits. What is the best of your recollection as 
to whether those splits occurred before or after you received 
payment? 

A To the best of my recollection, the pattern was when 
we satisfied a shipment and when we had the money in our 
accounts. We didn't — there were a nximber of times that we- 
put ourselves at risk and, counting on receiving money at a 
later date, we committed ourselves. 

But generally we bought when we had the money and 
vhen we paid the supplier and the goods were shipped and then 
General Secord and I happened to be in Geneva we sat down and 
looked at it and we decided if it was not an automatic 
situation, we — things had to be right for us to do it. We 
had to be there to look at the bottom line and see what 
happened and maJce the allocations. 

Q Now, there are two different phases, are there not, 
in connection with these sales of arms to the contras , or for 
the contras? 

A In which way, two phases? You mean one with the 
Canadians and one — 

Q No. I mean at an earlier point in time, the monies 



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for the arms came from the contras, or someone acting on the 

contras' behalf, who would physically wire a purchase price 

into the Energy Resources account. -/,>-. 

CALt/2.0 

A Are you referring to Mr. BHBIB? 

Q Yes. At a later point in time, you received 
directly into your Swiss accounts contributions which you used 
in a variety of ways, one of which was to buy arms. Am I 
correct? 

A Well, now that I have been listening to various 
testimonies, I understand that. But when monies were coming, 
into the enterprise accounts, I had no way of knowing whether 
it was coming from Mr. Calero or -- I didn't distinguish or 
differentiate between who was sending nor was I interested to 
know. 

I was told so much money would come in. 

Q But you are a businessman. I think that is one 
thing that — 

A I should hope so, yes. 

Q And as a businessman, you generally like to have • — 
you would prefer to have the money in your account before you 
buy the arms; isn't that correct? 

A Or the promise that the money would be there from 
someone that we trusted. 

Q Right. And that was a matter that you cared about 
keeping track of, whether you either had the money or you had 



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a promise from somebody that you trusted. 

A Yes. 

Q Now, at the earlier point in time the money that 
you needed to buy the arms with was coming from Calero. 
A I did not know that. 
Q It was coming from somebody who was giving you the 

money to buy arms. 

A Okay, now I understand. 

Q Later on you just had a pool of money sitting in 
your bank accounts and you would decide when to use it to buy 
arms; isn't that correct? 

A I don't think that is the way it worked ott. I had 
no part in making decisions when to buy arms. I had no feel 
or understanding or involvement in the operation of the 
so-called war, you know. There was a war to be fought and 
General Secord knew what was going on and his agents there, 
and he decided when to buy, what to buy and how much to buy 
and how to manage the total system, and he would also look at 

what he had. 

Q I Will just state for the record that it is very 
Obvious from just looking at the bank records that you provided 
to us that in the middle of 1986 the money for purchasing of 
arms from Defex was just sitting in the accounts; it was 
either there because of arms sales to Iran or it was there 
because someone contributed ij 



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A There was a time that we were not worryinq about 
w tere is the next penny going to come from. 

Q In that situation, if you then used that money to 
buy arms for the contras, would you — money that was already 
sitting in the account and had been there for some time — 
would you distribute profits at the time you purchased the arms, 
at the time you delivered the arms, or don't you know? 

A Until the transaction was completed and the goods 
were shipped, I do not recall' the time that we distributed 
profits, and there was a delayed situation because we were not 
there to distribute the monies. 

Q Well, then, how do you account for the 30-30-30-10 
distribution of over $800,000 in August of 1986? Is it 
possible that that was a distribution of profit from 
something other than arms sales to the contras? 

A This I really don't know. That late in the game, 
I don't know what that money was. If we sold — you told me 
that the money was from resale of arms to the CIA, if that was 
in September? That was one-point-something million? 

Q 1.2 million, September 24. 

A Then we have to see if we charged the enterprise 
for $2 million. If we did that, then it is very possible that 
we distributed the money prior to making the shipment to the 
CIA. I don't know. 

We really have to look at the records. I totally 



iiKioi Acoincn 



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-relied on General Secord to tell us when, how much to divide. 

MR. HOLMES: I wonder if I could ask a couple 
questions on this point? 

MR. NIELDS: Let me just say first that I have to 
leave. If the witness is willing, you can continue without 
me, or we can use the time to sort of go off the record and 
talk with them for a couple minutes and talk amongst ourselves. 
Why don't you ask your questions first and then tell 
me whether you wamt to proceed in ray absence or whatever. 

MR. HOLMES: I want to pick up the baton. I just 
wanted to finish this line of questioning. 

EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 
BY MR. HOLMES: 
Q Mr. Hakim, you knew an individual named | 

I did you not? 
A Yes. 
Q He was the individual who operated] 



A I don't have first-hand information on that because 
that is how it was told to me by General Secord. 

Q He is the individual that you went to Lisbon, 
Portugal, with to look at Defex? 

A Yes, 

Q And later on he was also an individual that you 
contacted about this shipment of arms in approximately July 



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of 1986, the shipment of arms that was at that point being 
loaded in the Mediterranean? 

A Does this have anything to do with 



Q Yes, it does. 

A It has absolutely 'nothing to do with the contras or 
the Iranian initiative. 

Q No, no. I am not talking about those arms of| 
I thought the question was ifl 
had something to do with it. I am talking about a shipment - 
of arms being loaded on the Mediterranean aboard the Erria in 
July '86. 

A ^^^^^H had something — 

Q It was eventually sold to the CIA through] 



A It is very possible that General Secord used^^^^H 
to be the agent to sell to the CIA. 1 don't know. I recall 
vaguely some discussions about CIA not wanting to deal with s 
directly because of the taint, so it is very possible that 
General Secord put him in touch with^^^^^V 

Q Do you recall any discussions with Secord about 
that? 

A About? 

Q About putting ^^^^^^^^^^^^^^H onto problem 
of the arms that were stranded in the Mediterranean. 



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A No. 

Q Do you recall any conversation with Secord about a 
man nanied^^^^^^H 
A Who? 

A No, 1 don't. I don't believe I have ever heard the 
name before. 

Q 

A I don't remember. This is the first time I hear 
the name. To the best of my recollection, this is the first -ti 
I hear the name. 

Q Now, there was a time when you were involved in the 
direction of the Erria as it moved through the Mediterranean; 
isn't that right? 

A For what mission are you — 

Q In particular in this mission, the movement of the 
arms to^^ 

A This is in connection with the sales to the CIA? 

Q Yes. 

What eventually became the sale to the CIA. 

A I was not directing that movement. 

Q Tom Clines was doing that then? 

A I don't know. Most probably. I don't know. 

Q Didn't you give directions to the captain of the 



ship from time to time? 



UNCUSSIFIED 



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A Not in connection with that shipment. I was — 
there were two occasions that I recall that I gave directions 
through the officers of the shipping agency to the captain. 
One had to do with the T-72 tank from Iran 



Q All right. And on this occasion you didn't have 
anything to do with th3 direction of the ship as it moved from 
the Mediterranean tc 

A If this is the shipment, the last shipment, the 
stranded shipment, I had nothing to do with it. 

Q Okay. You were aware that the ship was boardedJ 




w tile it was in the Mediterranean and the goods were examined 
there? 

A I an not aware of that. 

Q And it was after that that the arms were trans- 
shipped 

A This is the first time I hear this also 

Q You didn't know anything about 

A No. 

Q Okay • 

Now, do you recall any conversations with General 
Secord about how the eventual sale was made to the CIA? 

A No. 

Q I guess you talked to him a little bit about it. 



1 

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\ because he said the CIA wouldn't buy it from you directly, 

2 you needed a cutout? 

3 A I remember that when we were deciding what to do 

4 with the shipment that was sitting there. That was prior to 

5 him making the decision. I testified that I don't recall what 

6 was his final decision. 

7 Q This conversation would have been approximately in 

8 July of '86 while the shipment was still in the Mediterranean? 

9 A No. My discussion took place before anything was 

10 shipped or completely purchased. I said I recall that we had 

11 an outstanding down payment or deposit with the supplier and 

12 we had to make a decision either to forgo the deposit or pay 

13 the rest and resell it. 

14 That was one I lost track of. 

15 Q So this would have been June perhaps of '86, maybe 

16 early July? 

17 A I don't know, 

1« MR. JANIS: If you know. 

1> MR. HAKIM: I really don't know. The best way I 

20 ceui answer that question, to the best of my recollection, all 

21 this was occurring at a time that General Secord and his 

22 agents were talking to the agency about the total contra 

23 situation, and I was totally out of that. 

24 BY MR. HOLMES: 

2' Q I didn't mean to get into this, and 1 will show you 



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dociiments at another time. My point is simply that the sale 
to the CIA^^^^^^^Iactually eventuated in the amount of about 
two and a half million dollars, and I suggest the possibility 
that you took the coiranission that would have been due to 
^^^^^H since you had brought^^^^^^^Hthroughi 
on the sale. 

Does that make sense to you? 

A When you say "you," you mean who? 

Q You. 

A Albert Hakim. 

Q The group there that was eventually sharing these 
commissions. 

A I am suggesting that — I am suggesting that you 
don't group us, because I testified I was not aware of what 
was General Secord's decision at the time and how he handled 
it. 

Q All right. I don't neam that you personally did 
it; I an saying the money, comes in on your books in August, 
that is about when this sale took place. Do you recall any 
discussions that this $800,000 amount could have been the 
commission not on the sale by Y^^^^^^^^IH ^^^ '^^ ^^^ 
commission ^^^^^^^|to the CIA? 

A I have no idea, sir. I really am — the part that 
you are questioning me on today is 'the first time that I am 
hearing. I didn't hear from Mr. Secord or Mr. Tom C lines. 



HMP! mM\[ 



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\ This is the first time I am hearing it now. 

2 This project was finally resolved. 

3 Q Do you have any other explanation for why a 

4 commission would have come on your books in August of '86? 

5 A Without examining the total activity on the records, 

6 I cannot offer any other explanation at this time. 

7 Q It would have had to have been you who directed this 

8 money out of the account, wouldn't it? 

9 A Pardon? 

10 Q It would have been you who ultimately directed the. 

11 money, the various amounts that we haiVe discussed — 

12 A You mean the distribution of the 250s? 

13 Q Yes, the $258,398 figures. You would have had to 

14 direct those to be allocated at that time, wouldn't you? 
18 A We jointly had to do that. General Secord and I. 

16 I have testified that at no time did I, independent of General 

17 Secord, make any allocation. 

18 Q All right. So if I understand your earlier 

19 testimony correctly, Secord didn't have the authority to 

20 simply notify CSF to make this allocation by himself without 

21 you doing so, as well? 

22 A I believe you are referring, when you say Secord 

23 didn't have the authority, you are referring to the part of my 

24 testimony w lere I was explaining to Mr. Nields that at the 

25 beginning of our relationship, or rather. General Secord 's 



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relationship with CSF, he did not have the same relationship 
that I had, but later on, as time went on, General Secord was 
known to CSF and had a different relationship. 

Q So you are saying by August of '86 he may well have 
simply directed that allocation without your knowing about it? 

A It is very possible, yes. 

Q And do you recall yourself allocating or directing 
that allocation? 

A I may have. I don't remember. It was a very, very 
tense period at that time. We had so many issues that were on 
hand to deal with. 

Q I understand. 

Aside from yourself and Secord, there was nobody 
else in the world who could have directed those allocations; 
am I correct on that? Clines couldn't have done so, for 
example? 

A Clines did not have the authority, definitely. 

Q Was there anybody else in the world who had that 
authority except yourself and Secord? 

A Not to the best of my knowledge. The world is a 
big place. No one that I knew in our structure had that 
authority. 

MR. HOLMES: Thank you. 

I just wanted to — I thought perhaps that 
transaction would ring a bell. 



t 



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MR. NIELDS: Unless these other gentlemen feel 
strongly the other way, I think we will adjourn until 10:00. 

Is that okay? 

MR. VAN CLEVE: Fine. 

MR. HOLMES: Fine. I don't feel strongly about 
anything at this point. 

MR. NIFLDS: Okay. 

(Whereupon, at 5:10 p.m. the deposition was 
adjourned, to be reconvened at 10:00 a.m. on May 23, 1987.) 



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DEPOSITION OF ALBERT HAKIM 

Saturday, May 23, 1987 

U.S. House of Representatives, 

Select Committee to Investigate Covert 

Arms Transactions with Iran, 
Washington, D.C. 

The Committee met, pursuant to call, at 10:00 a.m., in 
Room H-128, The Capitol, with John Nields presiding. 

On behalf of the House Select Committee: John Nields, 
George Van Cleve, John Fletcher, Joseph Saba, Robert Brink, 
Ronald Points. 

On behalf of the Senate Select Committee: Arthur Liman, 
Cameron H. Holmes, Timothy Woodcock, Louis Zanardi, David 
Faulkner, Nicholas Wise, Paul Barbadoro, John Monsky. 

On behalf of the Witness: N. Richard Janis, Lawrence H. 
Wechsler, and Clement R. Gagne, III; Janis, Schuelke & 
Wechsler, 1728 Massachusetts Avenue, N.W., Washington, D.C. 
20036. 



wiissiniB 



Partially Declassified/Released on i^Lii^ 

under provisions ol E 12356 

by K Johnson, National Secufily Council 



196 



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.A1 
1 

2 

3 

4 DEPOSITION OF ALBERT HAKIM 

5 

6 Saturday, May 23, 1987 

7 

8 U.S. House of Representatives, 

9 Select Committee to Investigate Covert 

10 Arms Transactions with Iran, 

11 Washington, D.C. 
12 

13 The Committee met, pursuant to call, at 10:00 a.m., in 

14 Room H-128, The Capitol, with John Nields presiding. 
IB On behalf of the House Select Committee: John Nields, 

16 George Van Cleve, John Fletcher, Joseph Saba, Robert Brink, 

17 Ronald Points^ M>C^6 Uo-a LaJ'.Sj2_, 

18 On behalf of the Senate Select Committee: Arthur Liman, 

19 Cameron H. Holmes, Timothy Woodcock, Louis Zanardi, David 

20 Faulkner, tM^tadSan^^PiaB^ Paul Barbadoro, John Monsky. 

21 On behalf of the Witness: N. Richard Janis , Lawrence H. 

22 Wechsler, and Clement R. Gagne, lil; Janis, Schuelke & 

23 Wechsler, 1728 Massachusetts Avenue, N.W. , Washington, D.C. 
2* 20036, 



UNCLASSIFIED 



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m-jmrn 



1 Whereupon, 

2 ALBERT HAKIM 

3 having been previously duly sworn, was examined and testified 

4 further as follows; 

5 MR. JANIS: Before we begin today, there are a 

6 couple of things I want to state for the record, some of which 

7 may have been stated yesterday on the record, some of which 

8 may have been discussed off the record; but I just wanted to 

9 make a couple of things clear. 

10 I think it is fair to say — ernd I think, Mr. Nields, 

11 you would agree with me — that although we determined that 

12 the proceeding yesterday and today and however long this takes 

13 is going to be in the format of a deposition, the idea from 
both our points of view was to prepare the witness for his 

18 public testimony, both by refreshing his recollection and 
^^ confronting him with documents in order to do that and — 
'^ as well as to prepare the staffs of the committees for what 

he was going to testify to, the idea being that it was an 

effort at a — although in a deposition format, an effort to 
**» cooperatively prepare for the forthcoming hearings. 

I think you would agree with that, Mr. Nields? 

MR. NIELDS: Yes. We want Mr. Hakim's help. It is 

not in our interests to try to ask him difficult questions. 

We simply want to get as much benefit from what he knows as 

we possibly can. 



uNCUssra 



198 



UNCUSSIHED 



1 We are doing this in deposition format because Mr. 

2 Hakim's counsel has, for obvious reasons, insisted on that in 

3 order to have immunity attached to what Mr. Hakim says, 

4 MR. JANIS: Thank you. 

5 In addition to that, I think we pointed out yesterday 

6 there are certain — it is our goal, consistent with that 

7 spirit, to try to cooperate with the committee and, in that 

8 spirit, after the proceedings last night, we went back to my 

9 offices and spent a considerable eunount of time trying to 

10 review the records that you provided to us at the deposition 

11 yesterday, as well as our own records and analyses, in order 

12 to refresh Mr. Hakim's recollection about certain matters that 

13 were inquired into, and in particular a matter inquired into 
^* near the end of the proceedings yesterday, and I think to some 
15 extent we have been successful in that endeavor, and I would 
^6 invite you, when we commence the proceedings here today, to go 
'^ back to that area and maybe inquire further. 

I also invite you throughout these proceedings to 
give us that opportunity to work in a cooperative manner, 
because I think it is in our interests, frankly, but I also 

2' I think it is in the interests of both of the committees in 

*^ I trying to ascertain the facts. 

23 In addition, I'm not sure to what extent this was 

placed on the record or off the record. There are a couple of 
other things that I think are important to emphasize. One, 



IINP.1 mm 



i 



199 



UNCUSSIHED 



t as I think we said on the record, Mr. Hakim, although he does 

2 speedc English well, English is not his native tongue. It is 

3 a second language. 

4 My own experience with Mr. Hakim has confirmed — 

5 and I think maybe to some extent you got a taste of this 

8 yesterday — there are times when it isn't even apparent but 

7 there are language problems, interpretation problems. 

8 Mr. Hakim sometimes uses words either more precisely 

9 or less precisely than we would in a colloquial English sense. 

10 I ask you to be patient about that and take that into account. 

11 Secondly, in part because of the proceedings 

12 yesterday and in part because of our efforts last night, it 

13 became more and more apparent to me, as I have indicated, I 

14 think, to you, Mr. Nields, off the record, that Mr. Hakim, as 

15 you know, was not the custodian of these financial records. 

16 He did not conduct the financial transactions. He did not 

17 prepare the ledgers that we have provided to you. 

18 Indeed, I believe he testified yesterday that he 

19 hadn't even seen the ledger that you showed him. And while he 

20 wants to be as cooperative and helpful as he can, and intends 

21 to do that and answer any questions he is capable of 

22 answering, to the extent you are looking to Mr. Hakim to 

23 provide expert testimony or auditing or accounting analyses, 

24 I think frankly he is — it is really unfair to ask him to do 
28 that. 



uNCUSsra 



200 



15 



19 
20 
21 
22 
23 
24 
25 



UNCUSSlFltO 



1 He is less able to do that than professional 

2 accountants and auditors that you have at your disposal. 

3 At the same. time, to the extent there are specific 

4 transactions and so forth you want to talk about, he wants to 

5 cooperate fully. 

6 But I think in terms of giving him a bunch of 

7 accounting papers and asking him to do either 'an accounting 

8 or auditing analysis, he is really not equipped. He has never 

9 had that capability. He didn't perform that function with 
'0 respect to the operations into which you are inquiring. 

I just wanted to alert you to that limitation. 
MR. NIELDS: Okay. What I would propose to do is 
when what was yesterday marked as Exhibit 1, when that comes 



^* back in copy form I would suggest that we turn to that at that 



time and that you ask him the questions which you believe 



'* would be useful in bringing out the information that you and 

^^ he developed last night, and I will state right now that I 
18 



adopt each one of your questions and that he is compelled to 
answer them. 

MR. JANIS: Let me think about that. 

MR. LIMAN: I think — 

MR. JANIS: May we go off the record for a second? 

(Discussion off the record.) 

MR. LIMAN: I adopt Mr. Nields * suggestion. It is 
in the interests of the committees to have testimony that is 



\m\ mm 



201 



HNSUSSffl 



as accurate as possible, and if, as a result of the witness's 
conference with you last night, he found that some of his 
answered needed to be augmented, then he should augment them, 
and that testimony would be as compelled as if it had been 

e given yesterday in answer to Mr. Nields' questions. 

Just so that there is no doubt about it, on behalf 

7 of the Senate Committee I adopt such questions as you will 

3 now propose in order to clarify or augment the testimony that 

g he gave yesterday. 



MR. JANIS: Thank you, Mr. Liman. 

I think we can go ahead and proceed with that. I 

12 don't know if we need the records. We have our copy. 
.g MR. NIELDS: Why don't you go ahead with your copy 

t4 right now. 
^g MR. JANIS: I am not sure he needs to look at this 

t6 anyhow. 

f7 EXAMINATION ON BEHALF OF THE WITNESS 

18 BY MR. JANIS: 

19 Q Mr. Hakim, yesterday near the end of the session Mr, 

20 Holmes, I believe it was, was asking questions with respect 

21 to a distribution of approximately $816,000 that took flace 

22 in August of 1986. 

23 Do you recall those questions? 

24 A Yes, I remember that. 

25 Q Do you recall being shown documents by Mr. Nields 



\iMr'. m\B 



202 



HHCUSSIFIED 



1 w tich highlighted the dates of distributions? 

2 A I recall that also, and — but I believe I had a 

3 problem with the dates that they showed me, as we discussed it 

4 last night. I would like to look at those again. 

5 Q As a result of — and we will show you that in a 

6 second; I am sure they will -- as a result of the discussion 

7 you had with counsel, without discussing specifically what was 

8 said, but as a result of discussions you had with counsel last 

9 night, your review of the records provided you by the committee 
10 and your review of records provided to you by your own counsel 
H which have not been shown to you by the committee, and as a 

12 result of discussions you had with counsel, do you have any 

13 current recollection with respect to the disposition — the 
1* distribution of approximately $861,000 on August 27, 1986? 
15 A Yes. 

18 Q Would you please amplify upon your answer 
^^ yesterday? 

A Yesterday I did not recall any one particular 
normal transaction. By the normal transaction, I meant that 
goods were purchased; SAT, Southern Air Transport, was 
commissioned to come and pick up the goods and take them to 
contras. 

That did not occur in one — the doc\iments were 
shown to me. I was puzzled. 

As the result of the questions that Mr. Hoffman 



UNCIiSSiriED 



203 



12 
13 
14 
15 
16 
17 
18 
19 
20 
21 



25 



asked and that 



; «/^ ■■ 



ttU 



Q Mr. Holmes? 

A Mr. Holmes. I am sorry. Mr. Holmes. 

Then I directed my thoughts to a transaction that 
they referred to yesterday as the stranded weapons. Last 

6 night when you showed me additional records and X started to 

7 reconstruct the events in my mind and I first remembered the 

8 position that Mr. Tom Clines had taken in connection with the 

9 so-called stranded weapons, and the position that he took — 

10 and I will explain that shortly — I concurred with his 

11 position and I do not recall whether we did that over the 
phone. It was — we were together. I just can't remember 
that, but definitely I learned about his position and his 
position was that this is going to be our last transaction in 
connection with the contras and we should maximize our profit. 

I did not disagree with his position. However, not 
having had the total picture, the set of cards at any time, 
amd General Secord has always been in that position, I 
expressed my acceptance of Mr. Clines' position that we 
should indeed try to maximize our profit. 

I do not recall that I participated in any further 

22 

meeting in deciding whether that decision was adopted or was 

23 

not adopted, but Mr. Clines' and my position of mautimizing 

24 

our profit was clear to General Secord. 

MR. NIELDS: I don't want to interrupt, but you 



UNCUSSIFIED 



204 



16 



25 



UNOSSin'ED 



1 said "clear to General Secord"? 

2 THE WITNESS: That we wanted to maximize our profit. 

3 MR. NIELDS: Does that mean Mr. Secord agreed to 

4 that? 

5 THE WITNESS: He knew what we wanted? 

6 MR. NIELDS: He saic" okay? 

7 THE WITNESS: This is what I don't recall. I will 

8 go further and try to explain this. 

9 MR. NIELDS: Okay. 

10 THE WITNESS: The records that you showed me yesterda 

11 Mr. Nields, led me to believe that the distribution of profits 

12 were made in July, and that, if you recall, puzzled me, because 

13 in July — and I would like to refer, go back and look at those 

14 documents that you showed me yesterday — in July I happened 
18 to be extremely busy trying to set up the August meeting in 

Brussels, and I was under a lot of pressure by Mr. North, who 

17 had a deadline to meet, the elections were coming up. He 

18 wanted to take a vacation. 
I remember the crazy days I had to be present in 

Korea for a meeting. So when yesterday you mentioned July, 

I was thrown off. 

Our records last night indicated that the 
^^ distribution was made in August. That also helped me to 
2* recall things a bit better and further investigated about the 

date, and it started to make more sense because our records 



IINCUSSiFlEfl 



205 



BNuUSS'ffl 



10 



1 show that the purchase -- we completed the procurement of the 

2 so-called stranded weapons in July and — but we actually did 

3 not get around to distribute the profits on that procurement 

4 because of the fact that we were all busy with establishing 

5 the second channel and, as I mentioned, my travel plans. 

6 And it wasn't until August when we finally managed 

7 to coordinate a date when we could meet with the gentlemen in 

8 Brussels, and those dates fall within the same time period 
that the distribution of the profit was made. 

10 So all these put together reminded me that the 800 - 

11 was it 61,000? 

12 MR. LIMAN: $861,000 is the rough figure. 

13 MR. NIELDS: $861,327. 

1* THE WITNESS: — was distributed at that time. 

18 MR. JANIS: Maybe I can help. 

1* BY MR. JANIS: 

17 Q Mr. Hakim, to the best of your recollection, having 

^' reviewed records, the purchase of the weapons that you 

^' referred to as the stranded shipment, from whom were those 

**' weapons purchased? 

A To the best of my knowledge, to the best of my 
recollection, we did not change pattern. I believe they were 
purchased — we continued to purchase those from Defex. 

Q Approximately when were they purchased? 

A I believe the records that we looked at indicates 



1 1SSM^ 



206 



UNCuSS'ffl 



11 



July of '86. 

2 Q Approximately how much was paid for those weapons? 

3 A If we have all the figures in the documents that you 

4 provided me with, it should be around $1.7 million. 

5 Q Now, to the best of your knowledge, was the source 

6 of those funds donations on behalf of the contras or money 

7 received from Mr. Calero, or was it money that was simply in 

8 the enterprise? 

9 A To the best of my recollection, by this time we -- 

10 or sometimes before that, we had stopped receiving money from 

11 what I know to have been Mr. Calero. 

12 I did not learn about this until looking at the 

13 tapes, and by this time we were dealing purely with the income 

14 from the sales to the Iranians, the enterprise money. 
IB Q To the best of your knowledge? 

18 A That is what I testified I said. That is what I 

17 recall. 

Q Now, the weapons, who determined what the commission 
wcHild be on the sale of those weapons? 

A The pattern never changed. To the best of my 
recollection, I am reasonably sure that I remember this thing 
correctly — I continued to be a good soldier throughout this 
whole mission, and General Secord was the person who had the 
total picture, and he determined, like always, as he has 
testified from my interpretation of watching his tape, that 



iiNp! h^mm 



207 



21 



23 



25 



ttUSUSSftiti) 



12 



1 he set the prices and the commissions. 

2 Q Did you have any discussion with Mr. Clines that 

3 you can recall about the commission on this — what you termed 

4 the stranded shipment? 

5 This was apparently going to be the last contra 

6 shipment? Was that your understanding? 

7 A This was my understanding. 

8 Q Did you have discussions with Mr. Clines whether a 

9 normal commission would be charged on this shipment? 

10 A I recall Mr. Clines and I had a — he proposed, and 
^^ I agreed, that we should maximize our profit for this last 

'2 shipment. 

13 Q Did you discuss with Mr. Clines specifically what 

^* your commission would be, what percentage it would be? 

16 A I cannot recall that, Mr. Janis, what that would be. 

^* I recommended to him that, I agree with you, however, there 

^^ is a bigger picture. The bigger picture should not get 

damaged and we should leave the decision to General Secord. 
Q Is it your understanding that the commission of 

^^ $861,000, that the $861,000 represents the commission with 



respect to those arms purchased from Defex for $1.7 million? 
22 A Based on what I have seen so far and based on vtet 



I can recall, the answer is yes, 



2* Q I realize that this, in light of your other answers, 



may be speculative. But is $861,000 approximately 50 percent 



UHCUSSitiW 



208 



mmmm 



13 



1 of the purchase price of the weapons from Defex? 

2 A I would say that is 50 percent of the figures that 

3 have been shown to me. I do not have additional information 

4 if there were other goods included in that shipment. 

5 I could see only the payments made to Defex, and if 

6 that is the only thing, then those two payments were the only 

7 two payments to Defex, the answer is correct. If it 

8 constitutes 50 percent. 

9 Q And when we say 50 percent — 

10 A 50 percent from what we call from the bottom, not 

11 from the top. 

12 Q And the 50 percent figure again, to some extent it 

13 is hard to be precise, given the fluctuation in currency values 

14 and bank commissions and that sort of thing; isn't that 
IB correct? 

16 A I agree with that. 

17 Q Now, did there come a time when these weapons were, 

18 in fact, sold to another purchaser? 
^9 A I leaurned that yesterday. 

20 Q Do you know approximately how much was paid for the 

21 weapons? 

22 A I was told that $1.2 million was paid for those. 

23 MR. LIMAN: That is what you learned yesterday? 

24 THE WITNESS: Yes, sir. 



UNCLASSIFIED 



209 



'mriifito 



14 



BY MR. JANIS; 

2 Q That SI. 2 million was deposited in the funds of the 

3 enterprise; is that correct? 

4 A It was reimbursement, yes. 

5 Q And at the time were you involved in those 

6 transactions with the purchaser? 

7 A No, I was not. 

8 MR. JANIS: Do you want to pick up now? 

9 MR. NIELDS: Yes, sure. 

10 EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 

11 BY MR. NIELDS: 

12 Q First of all, did you have a chance yesterday, in 

13 addition to consulting your records and your memory and your 
1* lawyer, to consult with either Mr. Secord or Mr. Clines about 
1' their recollection on this transaction? 

A I did not speak with Mr. Clines, Secord or his 
lawyers. 

Q Was your recollection influenced in any way by what 
you were told about their recollections of this transaction? 

A Yes. 

Q You referred to some additional — and that is 
yesterday, I take it? 

A Last night. 

Q You indicated that you consulted some additional 
records that we have not seen. Could you describe those 



llMCUSSlfP 



210 



11 



UNClASSinED 



15 



records for us? 

2 A These are the worksheets that my attorney has 

3 generated and created from the review of the accounts and the 

4 records. 

5 Q To your knowledge, are these records that your 

6 attorney created based exclusively on the same documents that 

7 you made available to the committee? 

8 MR. JANIS: If you know. 

9 THE WITNESS: I have no knowledge of that. I really 
^0 did not participate in the effort that Mr. Janis went through 

in trying to provide you with, or cause me to provide you with, 
^2 the documents that I have had to go through, a lot of work to 
^3 do that. I don't know what else. 

^* MR. NIELDS: Just off the record for a second. 

(Discussion off the record. ) 
MR. NIELDS: Let's go back on the record. 
BY MR. NIELDS: 
Q I am going to show you a document — 

MR. NIELDS: Let's mark this as — I am going to use 
it to refresh his memory. Let's mark it as Exhibit 2. 
(The following document was marked as 
AH Exhibit 2 for Identification.) 
COMMITTEE INSERT 



UNCLASSIFIED 



211 



12 



25 



ONCLhSSIFIED 



16 



1 MR. NIELDS: This is everything, all ins and all 

2 outs. 

3 I will state for the record that this is a document 

4 prepared by accountants working for the committees, who have 

5 gone over the documents and records that you supplied to the 

6 comr.lttees in Paris. It is a record of all money going into 

7 the bank accounts that you gave to us and all money going out 

8 of the bank accounts that you gave to us. It excludes transfers 

9 from one account to another. 

10 Follow me? 

11 THE WITNESS: Yes. I understand. 
When you say one account to another, could you 

13 qualify that? 

14 BY MR. NIELDS: 

'^ Q In other words, if money moved from Albon Values to 
18 Hyde Park Square, you will not see it on here. 

'' MR. LIMAN: Inter-company transfers were eliminated. 

^® THE WITNESS: From what I can remember and what I 

have been told, in addition to the so-called inter-company 
transactions, there were also, from our so-called enterprise, 
there were monies transferred to CSF accounts back and forth. 



" That has created further confusion 

So do you include that, as well? 
24 



MR. NIELDS: Those are — 

MR. ZANARDI: Those transactions have been 

IINCUSSIFIEil 



212 



16 



19 
20 
21 
22 
23 
24 
25 



UNCUSSIFIED 



17 



1 eliminated. The only thing -- what we have is the $47 million 

2 vrtiich you testified to in Paris as the income, and only 

3 expenditures that left the operating accounts and either went 

4 to pay normal expenditures or went into the- capital accounts. 
6 That is what is left. 

6 MR. FLETCHER: Let me clarify that. There are 

7 several CSF accounts floating out there. There is a CSF 

8 account that is in the legend, transfers back and forth. 

9 Is that correct, Lou? Those would not be reflected 
10 there. But a transfer to the CSF account, for example, in New 
^^ York, that would be reflected there. 

^2 MR. ZANARDI: What would happen, it goes one step 

'3 further. What it takes is the -- the transfer to New York and 

^* expenditures that went from New York CSF or Brussels CSF to, 
say. Southern Air or one of the vendors. That is what we end 



'" up with. 

•' MR. LIMAN: What we are showing him — that is the 

18 



question he has. Maybe go off the record on this one. 
(Discussion off the record.) 
BY MB. NIELOS: 
Q This document shows all money that goes into the 
system? 

A Okay . 

Q All money that goes out, or comes back again, and 
obviously washes are not reflected here and inter-system 



UNCLASSiHED 



213 



UNCUSSIHED 



18 



1 transfers are not reflected here. Money coming into the 

2 system is reflected. Money going out of the system is 

3 reflected and money going into capital accounts is reflected. 

4 A Let's go at it and see what we find. 

5 MR. NIELDS: Am I summarizing correctly? 

6 MR. ZANARDI: That's right. 

7 BY MR. NIELDS: 

8 Q I am putting now in front of you a document marked 

9 Deposition AH-2. You just testified, based on summaries of 

10 these same rfecords that you were shown by your lawyers — 

11 discussed with your lawyers yesterday, purchase payments 

12 totalling about $1.7 million for arms. 

13 A You are referring to the so-called stranded purchase; 

14 Q Yes. 

18 I have on AH-2 circled two numbers. One is 

18 $845,000 on July 10, 1986, and the other is $881,987 on July 

17 16, '86. 

18 My question is: Are those the two numbers that 
18 represent the purchase price of approximately $1.7 million? 

20 A To the best of my knowledge, and like I said 

21 earlier, unless there were other factors involved, to the 

22 best of ray knowledge, these two form the total procurement for 
the so-called stranded weapons. 1.7. 

Q I should let the record reflect they add up to 
almost exactly 1.727. 



BNCUSSlFe 



214 



25 



UNCUSSlFiEO 



19 



1 A Yes. Okay. 

2 Q And half of that is just under $863,000? 

3 I think your lawyer indicated maybe there are bank 

4 charges and exchange — 

5 A Currency — 

6 Q — currency exchange factors that might ha^e 

7 affected it. But the amounts that were — 

8 MR. LIMAN: They add up to $863,000, a little more 

9 than $863,000. 

10 MR. NIELDS: You are right. It is a tiny bit over 

H 863. Just over. 

12 MR. LIMAN: Bank charges, which they must have taken 

^3 out. 

14 MR. WECHSLER: Also exchange rates. 

IB BY MR. NIELDS: 

18 Q I just want to make the record clear on this. 

17 On -the next page of the same exhibit, on August 27, 

^* 1986, there are four numbers that go to Korel, SciTech, Hakim 

^' and C. Tea in the amount of $258,000 and some, $86,000 and 

20 same, $258,000 and some, and $258,000 and some. 

21 I take it those are the profit distributions that 

^^ you just testified relating to the so-called stranded 

23 

* shipment? 

2* A That is the commission distribution, yes. 

Q Which adds up to just over $861,000, which we have 



\m A.OTFD 



215 



OriClASSIHED 



20 



1 computed to be almost exactly 50 percent of the purchase 

2 price. 

3 A It appears to be that, yes. 

4 Q My question -- I think you answered this, but I just 

5 w^lit it to be clear. 

6 My question is: Was this commission distribution 

7 done at a time when it was still contemplated that the arms 

8 would be shipped to the contras? 

9 A The reason I chose the terminology "stranded" was 

10 basically because there were so many options that was 

11 discussed. 

12 It may not — in this context of the question that 

13 you are asking, it may not relate to what I'm about to tell 

14 you, but as a matter of principle, this was the other part of 

15 the total picture of the Udall assets that was referred to in 
18 the testimony of General Secord. 

17 This whole thing had to be dealt with together, and 

^8 I had no participation when — in the dealing — when the 

^' dealing with the CIA came about. I don't know. 

20 What I know, it had to do with the process that had 

2' to complete and finish our activity with contras. That is the 

*^ way I understood it. 

23 EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 

24 BY KR. LIMAN: 

28 Q I take it you bought the arms for the purpose of 



iSlaCSlFlEO 



216 



ONdUSSIflED 



21-35 



1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
18 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



the contras; that is what you testified to? 

A That was ray understanding. 

Q And there came a certain point when they were 
stranded? 

A That is correct. 

Q And you learned yesterday that they were ultimately 
sold to the CIA? 

A That is correct also. 

Q I' think that the question is: At the time that the 
profit distribution was made in August, on August 27, was it 
your understanding that the arms were still going to the 
contras or had you by that time learned that they had become 
stranded? 

A I still was under the impression that it was not — 
had not found a home. That was my impression. 

Q But was it your impression that they were still 
working on getting them to the contras? 

A Yes. That was my understanding. 
MR. LIMAN: Thank you. 



UNCUSSIflED 



217 



Dotson/drg 
rake #2 
11:00 a.m. 





BY MR. NIELDS: 
Q I am going to switch topics entirely, and then I am 
going to want to come back with these capital accounts and 
ptta I would like to mark this booklet Exhibit 3. 

(The Following Document was Marked as Hakim 
Deposition Exhibit No. 3 for Identification.) 
COMMITTEE INSERT 



10 

11 

12 

13 

14 

IS 

16 

17 

18 

19 

20 

21 

22 

23 

24 

2B 



m0^ 



218 



14 
15 



BNClllSSlFiEO 



37 



BY MR. NIELDS: 

Q Mr. Hakim, I am putting in front of you — this is 

a book of the disbursements, noncapital disbursements, that 

the accountants have determined left the accounts that you have 

_ given us, and I would just like to go through them one at a 

- time and get as much help as we can from you as to what these 
o 

_ disbursements represent. 

A Okay. 

g Q Page 1 is headed "CIA". Mr. Secord has already 
testified — 

A It's page 37. 

Q Page 1 of 78. 



U A I am sorry. 



Q Mr. Secord has already testified that these dis- 
bursements went to an account that he understood to be a Swiss 
^e account owned and controlled by the CIA. These were related 
t7 to the arms that were sold to Iran. I take it you have no 
18 information that would contradict what Mr. Secord has told us. 
t9 A That is correct. 

20 Q Okay. Page 2 relates to purchases from the moneys 

21 that eventually went into the account that you identified 

22 yesterday as the Defex account. 

23 A Yes. 

24 Q The individual disbursements are on the back of that 
2B page, and I would like you to just take ^look at those and 



Like you to ]ust take ^1< 



219 



HHClASSm 



38 



\ tell us whether your understanding still is that each of 

2 these disbursements went into an account owned and controlled 

3 by Defex. 

^ MR. JANIS: Are you asking if he has any independent 

_ recollection other than what he has done here? 

g MR. NIELDS: I want to represent to him we have 

y determined each one of these disbursements went into the 

g account that he yesterday indicated was to the best of his 

g knowledge the independently owned Oefex account. It is the 

^Q one number ed^^^^^^l which appears on the Hakim ledger. 

^^ MR. LIMAN: What is the question? 

^2 MR. NIELDS: I think he has already answered the 

^3 question, but I want to do this in a methodical way. I take 

^4 it you have no information different from what you told us 

16 yesterday, which is these disbursements went to — 
te MR. HOLMES: What you just represented — 

17 MR. NIELOS: You had better correct me. 

18 Off the record. 

19 (Discussion off the record.) 

20 MR. NIELDS: Let's go back on the record. 

21 BY MR. NIELDS: 

22 Q We have been off the record for a few minutes with 

23 respect to the page 2 of Exhibit 3, and the accountants are 

24 going to get together, also off the record, with hopefully 

25 Mr. Hakim's attorneys and see if we can't come up with an 

mini anoirirv^ 



220 



UHCIASS!F![D 



39 



1 answer on this page, and I am going to skip it for now and 

2 proceed to page 3 . 

3 Page 3 relates to disbursements that went to 

4 Southern Air Transport. Mr. Hakim, if you turn it over, on 
6 the back of the page, you will see individual disbursements, 

6 and my question to you is: Can you tell u£ what the purpose 

7 for these different disbursements was? 

8 A It appears, from what I read here, that they were 

9 for the transfer — sorry, transport of weapons for the 

10 contras, and possibly toward the end there are some payments 

11 in connection with the Iranian Initiative. 

12 Q But you can't tell us particularly which are which? 

13 A I am incapable of doing that. 

1* Q I take it Mr. Secord would be the person in a 

15 better position to know exactly what these individual dis- 

18 bursements were for? 

17 A If he has the facilities, the documents and backup, 
1* definitely he is the right person to talk to. 

18 Q On page 4, there are shown five disbursements to 

20 Transworld, or, rather, six disbursements to Transworld Arms. 

21 I take it those relate to, at least to the best of your 

22 knowledge, to the transactions you testified about yesterday 

23 in which Transworld Arms supplied arms for the contras? 
2* A It appears to be that. 

Q On page 5, there are reflected several disbursements 



26 



221 



llNCUSSlfitO 



40 



) to ACE. Do you know what ACE is? 

2 A I believe, I am not sure, I believe that it is a 

3 Panamanian company that was created either by Southern Air 

4 Transport or Mr. Gadd ' s organization. I am not sure how 

5 that worked out. 

g Q Do you know why it was created? 
■f A I have no idea. 

8 Q You don't know what the purpose was? 

9 A No, sir. 

^0 Q Do you know what event its creation was connected 

11 with? 

12 A I have no idea, sir. 

13 Q I take it you don't know, then, what the particular 

14 purpose of these different disbursements was? 

15 A With the information that is available in front of 

16 me, the answer is no. 

17 Q And can you tell us — be careful here, I am not 

18 trying to get you to answer this if you don't know it. Can 

19 you tell us whether these were all related to the contras or 

20 whether some of them might be related to Iran? 

21 A I have really no idea. 

22 Q Page 6 shows payments to Monzer Alkassar, two of 

23 them. Who or what is Monzer Alkassar? 

24 A I do not have first-hand information about this. 
2B However, I do recall conversations, scattered conversations. 



222 







1 between General Secord and Tom Clines that referred to this 

2 gentleman. I believe he is a Lebanese or Arab-origin arms 

3 dealer that Mr. Clines had to deal with in connection with 

4 procurement of part of the items that he had available. That 

5 is my recollection from scattered conversations between the 

g two. I was not part of a discussion in connection with deal- 

7 ing with this gentleman. 

8 Q Do I understand, from your answer, that to the best 

9 of your understanding these disbursements are part of the 

10 purchase price of arms? 

11 A Yes. For the contras. 

12 Q Is Monzer Alkassar in any way related to Defex? 

13 A I believe he was introduced, again that is my 

14 belief, introduced by Defex to Mr. Clines. 

15 Q When these disbursements were made, who directed 

16 that they be made? 

17 A It was routine that Mr. Clines would report to 

18 Mr. Secord, General Secord, the status of each procurement, 

19 and Mr. Secord would go through a thorough analysis of those 

20 transactions, understand them, and make a decision what to do; 

21 and if payments were to be made, he would inform me and then 

22 ask me to make the arrangement for the payments. 

23 Q And then you would direct someone at CSF to make 

24 the disbursement? 
26 A Exactly. 



UNCUSSlrlED 



223 



wussra 



42 



f Q When he did that, did he at that time explain to 

2 you what the purpose for the disbursement was? 

3 MR. JANIS: This particular disbursement or in 
A general? 

g MR. NIELDS: If he can remember as to this particular 

g disbursement, I want him to answer that. If hp can't, I want 

■f to ask him if, in general, it was Mr. Secord ' s practice 

g to advise him of the reason for the disbursement. 

9 THE WITNESS: I was continuously under the impression 

10 that we were purchasing arms for the contras. So, in addition 

11 to the fact that I did not make a habit of getting involved in 

12 the operational aspect of things, I did not find it necessary 

13 to question Mr. Secord, but I continued to believe that these 

14 were for the purchase of arms for the contras. 

15 MR- LIMAN: Off the record for one moment. 

16 (Discussion off the record.) 

17 BY MR. NIELDS: 

18 Q We have just been off the record. We are now back 

19 on the record. I have drawn your attention, Mr. Hakim, to 

20 an entry on Exhibit 2 of August 30, 1985, showing a payment 

21 to Monzer Alkassar of $1 million. And my question to you 

22 is: Does that payment to Monzer Alkassar relate to arms 

23 that Mr. Calero has already paid for? 

24 A Mr. Nields, I have a basic problem to answer this 
28 question or any other questions similar to that because at no 



224 



UNCLASSIFIEO 



43 



1 time, until after I listened to the various testimonies from 

2 the tapes, I had any prior information as to who were the 

3 payees, payors and donors of moneys that were coming into our 

4 system. So I had no idea even if Mr. Calero was making any 

5 payments. So I am incapable of answering any question which 

6 is similar to the question tliat you are asking. 

7 Q I take it what you are saying, in addition, is that 

8 until the Iranian Initiative started, you had virtually no 

9 substantive involvement in the transactions of what we have 
to referred to here as the enterprise. 

11 A That is correct. 

12 Q Let's turn to page 7 of Exhibit 3. There are listed 

13 there some payments which are marked Robelo. Your records 

14 indicate that those are disbursements to a bank account 
^^^^^^^^^^^^^^^^^ Do you have any as to what 

16 those disbursements are eLbout? 

17 MR. LIMAN: What is the question? 

18 MR. NIELDS: Whether he has any knowledge of what 
^' these disbursements were about. 

20 THE WITNESS: Can you help me to identify where this 

2^ bank is located? Is it a European bank? 

22 MR. HOLMES; 

23 MR. WECHSLER: 
2* THE WITNESS: I can only guess. 




28 



225 



UNCLKSiFe 



BY MR. NIELDS: 
Q You need not guess. Down below it, there are dis- 
bursements, two of them — there are two disbursements to 
TDB Codelis, and TDB Codelis cash in the amounts of $101,500 
and $51,000. What is TDB Codelis? 

A ^irst of all, I would like to mention that for the 
101,500, it's not shown as cash. Only 51,000 is shown cash. 
The answer is I don't know. 

MR. LIMAN: When you say it wasn't shown, it wasn't 
shown on the schedule Mr. Nields has classified. 

THE WITNESS: Mr. Nields classified both of them as 
cash. 

MR. NIELDS: I didn't intend to. I didn't think I 
had. Mr. Secord has also told us he doesn't know what TDB 
Codelis is. These banks come off the ledger TDB Codelis. 
Off the record. 
(Discussion off the record.) 
MR. JANIS: Let's get back on the record. 
BY MR. NIELDS: 
Q Mr. Hakim, we have discussed this TDB Codelis 
off the record and shown you a couple of documents. Has any- 
thing refreshed your memory to the point you could make any 
educated guesses? 

A It hasn't refreshed my memory, but this TDB, as 
Mr. Tanis said, it might mean Trade Development Bank, reminds 



226 



WLnssra 



45 



1 

2 

3 

4 

S 

6 

7 

8 

9 

10 

11 

12 

13 

14 

16 

16 

17 

18 

19 

20 

21 

22 

23 

24 

26 



me of only one association with Trade Development Bank which 
had to do with the time that we tried to get organized and 
established a credit card arrangement. I believe I testified 
to that yesterday. 

And when we created this arrangement of having an 
American Express, that's the only way that I relate TDB to 
that. That's the only clue that I have in connection with 
this. 

Now, I also, from the other note you showed me 
today -- can I see that one more time, please? 

MR. JANIS: For the record, why don't we describe 
this. This is a note produced among the documents provided 
to the committees by Mr. Hakim. It is — 

MR. LIMAN: What is the Bates stamp number? 

MR. JANIS: H-1760. 

THE WITNESS: This is handwritten notes from Mr. 
Zucker. I recognize Mr. Zucker's handwriting, and the im- 
pression that I get, Codelis is either an account or naime of 
a person in connection with TDB which has to do with Servid 
structure, not ours. It's not related to our enterprise. 
It's part of Servid 's organization. Whether they are using 
that for the purpose that I mentioned for the payment of the 
American Express — 

MR. JANIS: Who is Servid? 

THE WITNESS: Servid refers to CSF. 



227 



HNWSSife 



46 



MR. NIELDS: It is short for Compagnie de Services 
Fiduciaries. 

I have just put another document in front of Mr. 
Hakim bearing Bates stamp H-1607, it also has the word, 
Codelis, on it, and at the top of the page it says, I believe. 



1 
2 
3 

4 

5 

g "Re: American Express 



THE WITNESS: These two transfers total to this 
101,000 that we are showing in Exhibit 3, page 7. There are 
two transfers. 

MR. JANIS: No, it is the same transfer. 
MR. VAN CLEVE: I may note it refers to Codelis 
SA, which suggests it is a separate Company. Does that help 
^3 you remember? 

-^ THE WITNESS: It definitely is not a company that 

15 belongs to our network of companies. 

BY MR. NIELDS: 

y-j Q But you think it might be part of Servid's network 

18 of companies? 
^g A I believe that would be closer to the truth. 

20 Q Then do I understand you to be saying that it is 

21 your recollection or guess that these disbursements are for the 

22 purpose of paying American Express bills? 

23 A I am saying that the only time that I can recall 

24 Trade Development Bank got involved or we got involved with 

25 them throughout our activities had to do with the American 



228 



25 



UNCUSSIHEO 



47 



\ Express Company, so that's the only clue I have in connection 

2 with any transaction with TDB. If CSF or Servid used this 

3 facility for other purposes, I have no idea of that. 

4 Q I understand. But these are disbursements that come 

5 out, initially that come out of your accounts? 

6 A So it is reasonable to assume that they were paying 

7 the American Express charges. 

6 Q Who had the American Express cards? 

9 AX had one, and General Secord had one. The same 

10 card. 

11 Q Anyone else? 

12 A No, not that I know of. 

13 Q Do you derive any meaning at all out of the fact 

14 these disbursements were from the Albon Values and the ToyCo 
IB accounts? 

18 Let me sharpen my question. Would that indicate 

^7 these are disbursements relating to Central America? 

^8 A That was my intent. If they really complied with it, 
I have no idea, because they have repeatedly shown in their 
bookkeeping they did not do proper allocation as I wanted 
them. 

BY MR. VAN CLEVE: 

23 Q This may have been asked, but do they handle your 

2* bookkeeping for American Express, CSF? 
A Yes. 



JM!U55irirn 



229 



12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
28 



ilASSIFiEB 



48 



1 Q So they were supposed to be bringing in those 

2 charges, making allocations and paying the bills, is that 

3 correct? 

4 A Exactly. 

5 MR. VAN CLEVE: Thank you. 

6 BY MR. NIELDS: 
^ Q Now, when they would pay a bill, I take it it 

required your approval first? 
8 A To the best of my recollection. As far as the 

'^ arrangement we had with American Express, we did not have 
11 



any track record, we didn't have any credibility with them. 
We had to set aside a certain sum of money that would satisfy 
American Express in approving the payments when we used the 
American Express. 

By the way, that leads me to make another conclusion 
here. It's very possible that Mr. Zucker or CSF created 
Codelis to put these moneys in there for the purpose of 
American Express. But this is only a deduction. 

Q You mean, I take it, they may have put the money 
in that account in advance of actually running up the bills? 

A We had to do it. That I recall. We had to — 

Q But now, would they actually take money out of 
one of your bank accounts without your prior approval? 

A I would say they would, yes. I would say they 
would for as long as they see thac it would lose the 



230 



23 



25 



mussro 



49 



t credibility of a credit card and they knew the credit cards 

2 were essential for us, if they would reach to a point that 

3 there was no cover, I would not be surprised to see them 

4 filling that account again so we could continue to use our 

5 credit card. 

6 As a matter of fact, I recall a number of times we 

7 faced difficulties because the bills were not paid on time. 

8 Q I want to make sure I understand this. 

9 MR. LIMAN: Have they ever turned you away from a 

10 hotel? 

11 THE WITNESS: For airlines, that is true. There 

12 were a couple times it was very embarrassing. Very embarrass- 

13 ing. 

14 BY MR. NIELDS: 

15 Q As a general matter, I take it you would authorize 

16 disbursements at Mr. Secord's request, but you would authorize 

17 the disbursement before CSF would actually make it? 

18 A Yes. 

19 Q This was a disbursement to the best of your 

20 recollection which was made before you ran up the charges? 

21 A We gave a blanket approval to CSF to maintain the 

22 funds as needed so we may continue to use the American Express 
card, sir. 



24 Q Did you tell them which accounts to take the money 



out of? 



HNCLASSIFIFn 



231 



UNClASSIFe 



50 



^ - A We tried as much as possible, Mr. Nields, when we 

2 turned in the, our copy of the American Express vouchers to 

3 annotate those with the alphabetical annotations that you 

4 referred to yesterday. Sometimes we adhered to our own rules, 

5 sometimes we didn't. 

g Q Were the American Express cards used for both the 

7 Iranian Initiative and for the Central American project? 

8 A I can't remember when the cards were issued, but 
g they were issued at a time the contra deals were going on. 

10 Yes, we would use them for that purpose as well. 

11 Q So you can't tell as you look at these disbursements 

12 of 101,500 and 51,000, you can't tell whether those were for 

13 contra expenses or Iranian expenses? 

14 A If our deductions and assumptions, as we have been 
16 doing them for the past few minutes, are correct, and I see 

16 the date. May, '86, and to the best of my recollection. May, 

17 '86 we were still involved with the contra activities, so it 

18 is reasonable to conclude that the American Express cards 

19 also covered the expenses incurred for the contras. 

20 Q Turning the page to the back of page 7 6 of Exhibit 

21 3, there are two disbursements to, I guess it is Mchose, 

22 Charles Lilac. Do you know what those are for? 

23 A I should know what these are. 

24 MR. WOODCOCK: Which one are you looking at? 

26 MR. NIELDS: My question is what the purpose of 

IliiAi inninrn 



232 



23 



2S 



UHCUSSIFIEO 



51 



1 this expense was. Was it related to the contras, related to 

2 Iran or related to something else? 

3 THE WITNESS: Technically, it should not refer to 

4 either one of those. It should -- I am not saying that it 

5 does — it should have been paid out of my personal accounts 

6 for my purposes, because this is the law firm that I work 

7 with. 

8 MR. VAN CLEVE: A California firm? 

9 THE WITNESS: Yes. San Francisco. 

10 BY MR. NIELDS: 

11 Q These are, in effect, personal charges rather than 

12 enterprise charges? 

13 A It should have been — I have seen so much sloppi- 
^* ness in this whole thing that I would not — I am not accusing 
IB Mr. Zucker, believe you me. Mr. Zucker also uses the services 
'* of the same firm. And one has to look to see if this bill 

^^ that came into Mr. Zucker 's — CSF's network, if the clerk 

out there decided it is Albert's bill that had to be paid or 
she differentiated between those. 
Q Got it. 

Who is Abdul Rahman? 



22 A The expense for Abdul Rahman should be allocated to 



SciTech, the allocation should have been made to SciTech. It 



2* was a SciTech activity. I testified yesterday that SciTech in 



certain areas represented STTGI, if you recall the testimony 

IlilAl ■ #kA... 



233 



20 



IINCIASSIHFO 



52 



f yesterday. This had to do with a transaction that had 

2 nothing to do with either the contras or the Iranian Initiative 

3 but with our activities in the UAAE. This is a gentleman who 

4 worked with us, and he incurred expenses. This gentleman 

5 is also related to the effort in connection with the activity 
5 that I testified earlier. 

7 Q Robinette, is that money paid in connection with 

8 investigative services for the lawsuit that was brought 

9 against Mr. Secord in Florida? 

10 A Not only Mr. Secord, also I was named as a defendant. 

11 That was my understanding. 

12 Q Would you turn to page 8 of the exhibit. 

13 Now, if the answer to this question is no -- 

14 MR. JANIS: You skipped those. 

15 MR. NIELDS: Yes. We have information on those from. 

16 Mr. Secord. I am not going to ask you about any of the other 

17 expenses on the back of page 7 because we have answers on 

18 those from Mr. Secord. 

19 In turning to page 8, if the answer is no, simply 
say no. 



21 Do you know what the disbursement to ^S Servid from 

22 the Dolmy account on the first of May, '86, in the amount of 

23 $6,406 represents? Is that some kind of fee to CSF? 

24 THE WITNESS: It could be possible. I don't know wha 
28 it stands for. It could be fees in connection with the 

iiimi nooinrn 



234 



iwsro 



53 



\ procurement of a ship. Doliry was the only account that was — 

2 BY MR. NIELDS: ^ 

3 Q That is fine, we understand that, I think. There is 

4 a reference here to a $15,000 disbursement for a closing 

5 entry from the Gulf Marketing account, 
g A I don ' t know . 

7 Q Okay. There is a payment on the Udall account 

8 reflected here, just under a $4,000 amount, to Compania Del 
g Desroko. Do you know what that is about? 

to A I don't know. 

11 Q There is a payment to the Bank of Korea in June of 

12 1985. Do you know what that is about? 

13 A I don't know. But anything to Bank of Korea must 

14 be something related to me personally. But I cannot recall — 
IB I don't understand what it means. Bank of Korea. That I don't 

16 understand. In the total complex, the only one who has any 

17 business relationship is me, and my wife is a native Korean — 

18 Q There would be no business expenses paid to the Bank 

19 of Korea that you could think of? 

20 A No, Unless they — I have no idea. It is possible 

21 they could buy a check from there and use it for a different 

22 purpose, I don't know. But my testimony is that I am the 

23 only one and have been the only one who has had any business 

24 transactions with Korea. 
26 Q So, to the best of your knowledge and understanding. 



235 



7 



UNCLASSinED 



54 



1 that would be a personal payment relating to you? 

2 A That is one possibility. That's one big possibility 

3 Q Could you turn the page. On the back of the page, 

4 there is an expense. 

g MR. JANIS: That first one, I think you will find 

g from the records that have been produced, it is a CSF fund. 

BY MR. NIELDS: 

8 Q On the back of the page, there is a $70,000 dis- 

g bursement from the Dolmy ' s account for CSF Guaranty Insurance. 

10 Do you know what that relates to? 
ff A No, I don't. I can guess. 

12 Q Was there insurance for the boat? 

13 A That was going to be my guess. 

14 Q Do you know, was CSF an insurer itself, or would 

16 you interpret this to mean that CSF obtained the insurance on 

16 your behalf? 

17 A I can tell you only what I asked CSF to do for us. 

18 I asked them to make sure the ship was insured. I also recall 

19 that Mr. Zucker had a very difficult time buying insurance. 

20 He didn't want to mention what kind of hardware the ship was 

21 carrying, and then he could not tell them, but he did manage 

22 to get us insured. How he did it, I don't recall. He is a 

23 very creative man, he could havebade some sort of arrangement. 

24 MR. VAN CLEVE: Do you recall the amount of the 
26 insurance policy? 



ONCUOTFfl 



236 



WlASSlfiffl 



55 



, " THE WITNESS: I don't. It should have been at 

2 least for the value of the ship and the estimated goods that 

3 were being transported. That's my professional guess. 
^ BY MR. NIELDS: 

g Q There is a reference a little further down on the 

g page to currency exchange totaling $29,000. What does that 

7 relate to? 

g A I have no idea. I can make a number of guesses, 

g but this could be — was this thing — are these expenses — 

^0 Q Expenses, yes. 

ff A So it probably means that when we either cashed 

12 out moneys for the exchange currencies — in Switzerland, when 

13 you go to a bank, even if you sneeze, they charge you for it. 

14 So when you — 

IB Q These are fees you believe for exchanging currency? 

16 A Or cashing out moneys. 

17 Q There is a reference to balance in transit, $50,000, 

18 and down below there is transfer to transit, $310,000, and 

19 your ledger has references to charges under the heading 

20 "transit". What do they refer to? 

21 A First of all, it's really not my ledgers, it's 

22 CSF's ledger; and, secondly, I am not familiar with these 

23 terminologies. 

24 Q You don't know what these refer to? 
26 A No . 



liCUSSIflED 



237 




56 



. Q There is a disbursement to Bank of Ostar TA in 

2 the amount of $30,000 on the 17th of February, 1986. What 

3 does that refer to? 

A A This is a bank in Brussels by chance? 

^ MR. WOODCOCK: What is the transaction? 

B MR. LIMAN: Do you mean a transfer to a bank in 

J Brussels? 

3 THE WITNESS: I remember as one of the techniques 

g that they used to lose trace of money and not have continuity, 

\Q we would purchase checks — 

^f MR. LIMAN: It is suggested to roe TA means Tel Aviv 

12 and this may be a Tel Aviv bank. Does that ring a bell? 

13 BY MR. NIELDS: 

14 Q There was a transfer, transportation of arms from 

IB Tel Aviv to Iran, a few days after the 17th of February, 1986. 

16 A I cannot understand why we would transfer money to 

17 Tel Aviv for that purpose. 

18 Q You might need cash for crew payments in Tel Aviv 

19 in connection with the flights to Iran. 

20 A Then that is possible. That is possible. . 

21 MR. LIMAN: It is Bank Oxard Hashial. 

22 THE WITNESS: Thatimust be an Israeli bank. 

23 MR. LIMAN: In Tel Aviv. 

24 THE WITNESS: So my first deduction is incorrect, 

25 and your assumption is closer to the fact. 



238 



3 



UNCLASSIFIED 



57 



^ " MR. LIMAN: It seems to have been wired to a 

2 Yvett, Y-v-e-t-t, and then there is Demile, D-e-m-i-1-e. I 

don't know which is the first name and which is the last. 
4 THE WITNESS: Mr. Liman, I vaguely remember that 

g there was a time, now that Mr. Nields has given me more input, 

g that the operational people did not take enough moneys with 

7 them to take care of the activities, and we had to do something 

8 to get the money there. I believe that that's how it 

9 happened. 

10 BY MR. NIELDS; 

11 Q There are references also on the same page to trips. 

12 I am going to assume that you have no recollection of what 

13 the first two trips refer to other than you would assume, I 

14 take it, that these are expenses related to trips taken by 

15 someone. 

16 A That is correct. 

17 Q Now, then, the third reference is trip WZ to the 

18 U.S. I take it that refers to Willard Zucker. 

19 A It must. 

20 Q Do you recall his taking a trip to the United States 

21 in July of 1986? And, if so, what was it for? 

22 A Let me check something with Mr. Janis here. 

23 Mr. Nields, I cim ready to answer your question. 

24 Q Yes. 

28 A I believe that this has to do with a request that 

IflfDf i AM.> 



239 



wimm 



58 



f i made to Mr. Zucker to come to the States to evaluate for 

2 roe certain investments that we were about to make. 

3 Q Which investments? 

^ A If this trip is the trip that I think it is, it 

g has to do with the investment that I classify as the Marostica 

g disaster. This gentleman introduced to a friend of General 

7 Secord, Larry Royer, and then from Larry Royer to General 

3 Secord and then down to me three investments that when I 

g finally — and I would like to underline finally -- looked 

10 at it, I classified it to be too good to be true. 

11 So I needed to really understand it, because General 

12 Secord, for whom I have a lot of respect, normally makes good 

13 judgments, and I had a feeling that this time he was off, and 

14 I needed to verify that. So I asked Mr. Zucker to assist me 

15 with that, especially I believe at that time, I may be wrong, 

16 but I believe during that period General Secord was not avail- 

17 able. So I did that with Mr. Zucker. 

18 Q Let me see if we can finish this page, and then we 

19 can zip through the rest of it fairly quickly. 

20 There is a cash withdrawal of $50,000 from Lake 

21 Resources on the 18th of February, 1986. Do you know what 

22 that relates to? 

23 A No, I don't. 

24 Q That is also within days of the transportation of 
2B arms to Iran. Does that refresh your memory, or can you make 



240 



UNCLASSIFIED 



59 



a' judgment about it? 



2 A It may or may not relate to the needs of the 

3 Iranian — 

4 Q You don ' t know? 
g A I don't know. 
g Q I take it you don't know what these cash withdrawals 

7 are right under it for $2,144 and $5,700? 

8 A It says general expenses, so it could be expenses 

9 incurred by General Secord, myself, or other people. 

10 Q You don't know whether that is Iran, Nicaragua or 

11 something else? 

12 A No. I cannot allocate those. 

13 Q Right below it is payment to the famous law firm 

14 of Janis, Schuelke & Wechsler. Can you tell us whether 
16 that is contra related or Iran related or something else? 

16 A First of all, it should have been allocated to my 

17 personal account. It should not have been sent from these 

18 pigeon holes to Mr. Janis' firm. I made it very clear to 

19 Mr. Zucker it should come from Albert Hakim to Mr. Janis' 

20 law firm. 

21 Again, this was another area sloppiness was in- 

22 curred. It had nothing to do in either case. It had to 

23 do with this famous crazy Florida lawsuit. 

24 Q That has to do with the Central America — 
28 A In my mind, with my involvement or lack of it. 

If MAI jiocinrn 



241 



3otson/drg 

end 
3inkel fols. 



UNCLASSIRED 



60-70 



I' really do not put it under any of those two activities. 
Q But it does relate to the Florida lawsuit. 
A Yes, it does relate to the Florida lawsuit. 




v;; 



242 



TAKE 3 md 

DINKEL fls 
DOTSON / 
12:00 Noon 
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

26 



UNCLASSIFIED 



71 



Q Okay. Down below, I am going to skip a bunch of 
things here, there is an expense for Garr, Inc. What is 
Garr, Inc.? 

A I don't know, sir. 

o Underneath that, there is 10,000 to Davco Associates. 
What is Davco Associates? 

A Davco Associates is a consulting firm in California 
that I employed for the use of STTGI or SDC, So, there were 
fees to them that either should have — if it were — if the 
services rendered by Davco were related to SDC, it should have 
come out of my personal account. 

If it were related to STTGI, it should have 
come out of the SciTech account. 

MR. VAN CLEVE: What is the general nature of 
Davco' s consulteuits? 

THE WITNESS: They are a confederation of independent 
retired people that provide consultants in various areas, 
security, business management. They have a broad capability. 
MR. JANIS. May I have your indulgence for a minute? 
BY MR. NIELDS: 

Q Let's just finish the page. There is a disbursement 
to Agios, A-g-i-o-s. What does that relate to? 

A I have no idea, Mr. Nields. 

Q I cun going to break. I think lunch is going to come 
at 12:30. You might want to break for five, and continue until 

IIIIAI lAAi**— 



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1 12:30, and then break for lunch. Does that make sense? 

2 MR. LIMAN: Sure. 

3 MR. NIELDS: I would just keep on going. 

4 (Discussion off the record.) 

5 (Recess.) 

6 EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 

7 BY MR. VAN CLEVE: 

8 Q Mr. Hakim, we are back on the record. We are 
^ proceeding to review what has been marked Exhibiij- 3. I ask you 

to turn to page 10 of that book. Page 10 reflects a series of 

disbursements to what I believe to be an individual named 

Meno Eytan. Can you tell us the circumstances for these 

disbursements? 

A I don't recognize these accounts, whether it is 

the name of an accouni o^ an individual. 
16 



MR. JANIS: Can we have some assistance here? I 
don't think this is — I think this is a bank. 

MR. ZANARDI. It is a bank. 

MR. LIMAN: I am told on the record that this is the 
— the Israeli account that is used for the Israeli Air Force 
when it is reimbursed. 

MR. JANIS: May we have a moment? 

MR. LIMAN: To give you an illustration of it, you 
can see the debit notices, but this is really the code name, 
if I can use that, of the — for the Israeli account. 



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' THE WITNESS: These are transfers from our system 

2 to them? 

3 MR. LIMAN: The Israeli account. 
THE WITNESS: Yes. 

5 BY MR. VAN CLEVE: 

® Q Does that information refresh your recollection? 
' A I have no knowledge of that. 

° Q Thank you very much. If you would turn to page 11, 

please? As you can see, Mr. Hakim, page 11 reflects a series 
of disbursements to SciTech, some of which are specifically 
designated as payments to Keith Phillips or as a result of 
the activities of Keith Phillips. 

I believe you identified Keith Phillips for us yest- 
erday. Can you help me out and just remind me who he is? 

A Mr. Keith Phillips is a gentleman that General Secord 
knows — I believe I have met him once or twice — to assist 
us with this Marways shelter project in Saudi Arabia. 

Q I notice that one of the transfers here is referred 
to as SciTech TriAmerican Arms. I wonder if you could describe 
the circumstances surrounding that transfer? 

A This to me indicates that money went into SciTech 
and from SciTech was sent to either TriAmerican Arms account — 
I am not sure whether such an account existed, or it went to 
the trust account of Mr. Marostica. 

Q I believe you spoke just a few minutes ago about some 



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1 of your dealings with Mr. Marostica, but I don't recall that yoi 

2 told us specifically about the TriAmerican Arms deal. Could 

3 you please tell us about that? 

4 A I believe when Mr. Royer introduced Mr. Marostica 

5 to General Secord, and Mr. Marostica came up with his out-of- 

6 the-ordinary investments, that attracted General Seccrd's 

7 attention. General Secord — I believe I was overseas. 

8 General Secord called me, very briefly explained 
to me about the nature of the three projects, and asked me 

10 if I would consider getting involved. My answer was that for aj 

11 long as I get a chance to examine this when I get back, it 

12 sounds good. 

13 He assured me that nothing concrete would happen 

^* immediately, but we needed to show that we were interested in 
" these projects and if I could go ahead and participate in this 

investment. 

17 And as a result of that, I instructed CSF to transfer 

" out of SciTech $150,000 to effectively Mr. Marostica, because 
'* even if the account was established in the name of TriAmerican 

Arms, I don't believe that anyone except Mr. Marostica had 

signature power in that account. 

To this date, I don't know whether that entity was 

incorporated, but the reason they had TriAmerican Arms used as 

a name was because three individuals were — or three groups w« 



involved, Mr. Marostica, Mr. Royer, and General Gecord and I as 



246 



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' the third group, and I believe the reason they used arms was 
2 because they were dealing with this submachine gun manufacturer 
3 

4 MR. LIMAN: American arms? 

THE WITNESS: American arms. So, they just used 
" TriAmerican Arms. 
7 BY MR. VAN CLEVE: 

" Q So, this payment would have been sort of in the nature 
of earnest money in terms of beginning work on a deal? 
A That is correct. 

Q Is it your testimony these were your funds only? 
A It is difficult to answer that question, frankly, 
because it came out of STTGI. It was STTGI — the way I had 
structured it was to mean ST — I am sorry -- let me correct 
that. It came out of SciTech. SciTech, the way I structured it 
was to mean STTGI overseas. 

Q Was that also a 50-50 partnership between you and 
General Secord? 

A That is why I aim saying it is difficult to answer 
that question. I can only tell you what my intentions were. 
Q Sure. 

A I might have very well communicated that to General 
Secord as well. That would be — it was not discussed that it 
was going to be a company that is going to have any activity. 
We were totally absorbed by the contra-Iranian initiative; but 



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1 this was a company that really was a shadow of STTGI overseas, 

2 so the monies that went in there went into Mr. Marostica's 

3 account from SciTech. 

4 Q Excuse me for being a little slow here, but STTGI is 

5 a 50-50 partnership, correct? 

6 A Yes, that is correct. 

7 Q Is SciTech also a 50-50 partnership? 

8 A It was never put in that way. My intention was that 

9 it was a 50-50 partnership between General Secord and I, but 
I don't recall that at any time I had a discussion with 
General Secord that SciTech is up on its feet and is doing 



'2 I business. 

^3 Q When SciTech makes this payment, is it fair to 

•* assume that it is a partnership investment? 

'" A That was my intention. I would say that SciTech, 
16 



it took its first step of becoming active. That is the way 
I would classify it. 

MR. LIMAN: Let me just show you something so it is 
precise. The actual payment, according to H-880, which is a 
record that you produced, came from the bank account for Albon 
Values Corp., and went to TriAmerican Arms. 

THE WITNESS: Directly? 

MR. LIMAN: Yes. 

THE WITNESS: It shouldn't have. 



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1 EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 

2 BY MR. LIMAN: 

3 Q And — now, the intention was, and it was charged on 

4 these ledgers as . a payment on behalf of SciTech; correct? 

5 A Correct. 

6 Q And SciTech was this mirror image of STTGI? 

7 A Overseas. 

8 Q That is correct? 

9 A Yes. 
^0 Q This was the company that you and General Secord 

were going to use for certain overseas activities in 

^2 connection with operations in Iran if the door ever opened; 

^^ is that my understanding? 

" A That is very correct. 

" Q The money now that was being transferred on behalf of 

SciTech to TriAmerican Arms was in the nature of a capital 

contribution to TriAmerican Arms on behalf of you and General 
IS 



Secord, as I understand it? 

A That is correct. 

Q And the request for this capital contribution came 
from General Secord, who was dealing with Marostica? 

A Yes. 

Q And, as I understand it, some $60,000 was then 

transferred by TriAmerican Arms to this machine gun company, 

American Arms? Were you aware of that at that time? 
IlilAI a A AB7-1f»f% 



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1 A I knew that the $150,000 was going to be given as som. 

2 sort of a deposit, earnest money, or whatever the type of 

3 discussion was to these three areas. 
^ Q Investments? 

5 A Investments. 

8 Q So you knew there would be money that was going to 

7 be paid out of the $150,000 into these three investments. 

* One was, as I understand it, the machine gun company; another 

' was timber; some others were high-tech projects? 

A No. No. The others had to do with food. 
Q Yes. 

A Food processing. 

Q And you knew there would be some investments made 
out of the $150,000 on behalf of you and General Secord in 
those ventures? 

A My understanding — if you don't distinguish 
between investment and earnest money, then the answer is — 
your statement is correct. I accept that. 

Q And then I take it you sent Mr. Zucker there to look 
at these projects? 

A I went with him. 

Q You went with Mr. Zucker? You concluded in your own 
words they were too good to be true? 

A We knew that from the outset, but we wanted to find 
facts. 



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1 Q Therefore, you didn't pursue the investments in those 

2 companies? 

3 A Well, that is not true. By then I had the opportunity 

4 of having a short meeting with General Secord in our offices 

5 in Vienna. I gave him a copy of the report that Mr. Zucker 

6 had prepared, and I told him, Richard, I think this is a scam 

7 I have no trust in Marostica. This whole thing doesn't jibe 
I just don't like it 

9 General Secord being a General , he took command 

'0 and said well, I will look into it, and I will do the right 
11 



thing and from there on, to this date, he has been handling 
it. 

Q And has any more money been invested in them? 

A I cannot remember clearly, Mr. Liman. I do remember 
two issues. I remember an effort that was made to make a 
transfer of $200,000 again to the very same account of Mr. 
Marostica. 

Q This also was going to come from SciTech? 

A It was supposed to come from SciTech. I also 
recall the normal difficulty that I had with banks. Mr. 
Marostica could not locate the money, and finally we — we 
got the money back. It never got to Mr. Marostica. That is 
what I can -- 

Q That is what you remember as you sit here today? 

A Today. But I also have another issue that is out- 

IlilAl mj%^ — 



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' standing in my mind, but I cannot at this time find the 

2 origin of this. That is in connection with the 

^ timber deal we had — the timber deal was a fascinating issue 

* that we were going to put in $100,000 and end up with 

millions of dollars in no time. 
® Q A highly leveraged transaction, by my standards. 
' A I tell you, it would have been the miracle of 
the century. 

Q It is only because you don't deal with junk bonds. 
A So, I cannot, sitting here, recall how we made that 
money available, but this time, I think we were smarter 
and decided not to give it to Mr. Marostica. 

We got it to the attorneys that we retained as a 
result of our being in Seattle. So, I don't know how we made 
that transfer. 

Q In all of these deals, the machine gun deal, the 
food deal, timber deal, how much money did General Secord 
tell you was going to be required as an investment on behalf 
of both of you? 

A I don't think that was ever put to me in that manner 
I don't think they had a business plan. That was one of the 
things that I didn't like. 

Q What were the numbers that you heard as to what woul< 
be the initial investments that you would be making on behalf 
of you and General Secord? ||Mr'S ACCI^ICn 



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' A The initial investment that I recall -- I would not 
^ even call it an initial investment. I would call it a total 

investment. 
* Q Total. 

^ A That would cause -11 these miraculous things to 
happen, was totalled up to be $350,000. That is why we had 
the 150 and the 200 that never got there. But as we 
got further into this what I called scam of Marostica, the 
ground rules continued to change, and each time we were 
surprised by a different figure. 

Q Can I just ask a few questions that as I listen to 
you this morning, were -- I was uncertain of. I know that some 
of this you answered yesterday. The ledgers that you have 
been going through are ledgers that, as I understand it, were 
not under your custody; correct? 

A Correct. 

Q They were prepared by Mr. Zucker or his organization 

A Correct. 

Q And you saw them for the first time very recently? 

A That is correct. 

Q And when you saw them, you saw that they were muddled 
in some respects? 

A Correct. 

Q And that you found that there were allocations of 



expenditures to accounts that you did not consider to be the 



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' correct accounts for those allocations? 

2 A Misallocations. 

3 Q Misallocations. And you have been going over this 

4 with your attorney in an effort to assist us; correct? 

5 A That is correct. 

6 Q At the time that you were engaged in these 

7 transactions, and relying on Mr. Zucker, did you not receive 
* monthly statements from him? 

A That is not the way we handled it. I will explain 
10 to you how we did that. First of all, I have a great deal 

of trust in Mr. Zucker. I sincerely mean that. He is a very 
1^ honorable man, very honorable man. This is -- this has been 
1^ the basis of our total activity, trust. 
1* Q Yes, but I trust the integrity of a bank like 
^* Chase Bank, but still I get statements or I have records 
^® available to look at. 
'' A I am coming to that. 
^* Q I want you to explain this. 

A I am coming to that. We were not that orderly. We 
were quite messy and quite inefficient for a number of reasons. 
I don't want — I don't know how much time you want me to spend 
explaining this, how value my explanation is, so please stop me 
if you see I am going too far in this. 

First of all, CSF was not established to handle a 
covert activity. Secondly, we could not tell CSF what we were 

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1 doing with regard to our covert activity. Third, Mr. Secord 

2 and myself, we had functions of operators, financiers, 

3 marketeers, we were -- you name it, we were all over the 

4 place. 

5 We ourselves were very inefficient. There were time; 

6 that we didn't have proper communications on this. There were 

7 times that we were under constant political pressure. That, 

8 I want to emphasize on that. Constant political pressure. 

9 I can give you one as an example. We had to meet 

10 a deadline in releasing hostages, because the elections were 
coming up, but that — I am trying to picture for you that we 

12 could not be as conventional as you think one could be. 

13 MR. JANIS: Just a moment 
1* BY MR. LIMAN. 

Q I appreciate it. You may want to finish this, becau: 
I am sure we are going to want to go into it in more detail, 
particularly when John comes back. My questions were, at the 
moment at least, narrower. 

During this whole period from the time of the first 
arms deal with Ca>lero until November of 1986, did you receive 
any bank statements from -- bank statements for the group of 
companies that were involved in the transactions? 

A I was about to answer that question. I was just 
reaching to that point, setting the stage for that. We could 
not have received statements, because our instructions were 

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1 in addition to everything that I told you, to maintain a covert 

2 activity. The way we controlled -- I understand your question 

3 to mean under the circumstances, how did we control -- 

4 Q No. I am going to — 

5 A We did not receive statements. 

6 Q You give your explanations, which I appreciate. I am 

7 not questioning you about the explanations. I really would 

8 like to defer that until John comes. 

9 A Okay. 

10 Q As I understand it, when you open an account in a 

^' Swiss bank, you can instruct the bank to send statements, or yoi 

^2 can instruct the bank to hold statements. Did you instruct 

^^ the Swiss banks to send statements to you? 

1* A Those were not my instructions. I dealt with CSF. 
CSF dealt with the banks. 

Q Okay. And did CSF send you any statements from these 



^' banks before November of 1986? 

^* A I don't think so. I don't recall ever asking CSF to 

19 



show me any bank statements. 

Q Did you ever inspect those statements at CSF? 

A I never inspected statements. I always inspected, 
together with Mr. Secord, what was the bottom line. We had 
a general idea what should — we should have had in the accounts 
We focused on that. 

Q In what form was this bottom line that you inspected 

•■■iAi lAAipir*^ 



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UNCIASSIFIED 



85 



^ together with General Secord? 

2 A There were computer print-outs that were shown to us. 

3 Q And who showed you those computer print-outs? 

* A Mr. Farina. 

* Q What happened to those computer print-'-'Uts? 
A I have no idea. I can make only a deduction, a guess 

that they should be with CSF. I don't know, 

Q Have you asked CSF to give you the contemporaneous 
computer print-outs? 

A When? 

Q Since you have been granted immunity from us and aske^ 
to produce records. Did you ask CSF, can you give us the recori 
that were prepared at the time? | 

A Since this — during the period that you are referring' 
to, 1 have not been able even to sneeze without the presence 
of my lawyers. 

Q Is the answer that you did not ask them? 

A I could not have. They instructed me — 

MR. JANIS: Excuse me, Mr. Liman. I am not sure 
I understand your question. Are you suggesting records in 
addition to those that have already been produced? 



MR. LIMAN: My understanding is — you tell me if I » 
wrong — that you do not know whether the records that we are 
looking at now as ledgers were prepared by CSF a month or two 
ago, or whether they were prepared as they went along. You 



I 



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1 don't know that? Am I correct? 

2 THE WITNESS: My understanding is different. 

3 BY MR. LIMAN: 

4 Q What is your understanding? 

5 A I would like to consult — 

6 MR. JANIS: Excuse me. I have to say something about 

7 the question. Excuse me. The problem I think with that 
question may be the use of the word "the records", in a very 

^ broad sense. 

10 I4R. LIMAN: There were ledgers given — computer 

runs that purport to be ledgers of CSF for these companies. 

Now, I understand that the testimony that has been given by Mr. 
'^ Hakim is that he never saw these ledgers until recently. 
1* MR. JANIS: I think what — to be specific, I 

think his testimony was with respect to the ledgers that were 

shown him, he had not seen them until recently. If there are 



^^ other ledgers that you want to show him, he presumably will be 
'* 2UDle to say, I haven't seem them, or I have seen them. The 
19 



ledgers he was shown, for example, indicate they were prepared 
some time around December 4, 1986. 

MR. LIMAN: Those were prepared by CSF? 

MR. JANIS: That is correct. 

MR. LIMAN: Now, have you produced for us the records 
^* that Mr. Hakim saw at the time when he and General Secord 
were looking at the bottom line? 

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' MR. JANIS: And I think the only way he can answer 

^ that is if you bring us the records that have been produced, 
^ he will have to look to see them. 



MR. LIMAN: I am entitled to put questions the way 



■ I want. I will ask this of you 
6 

7 



BY MR. LIMAN: 

Q When is the last time that you saw the records that 

contained this bottom line that you and Mr. Secord saw while 

these transactions were taking place? 

When is the last time you saw those records? 

MR. JANIS: You might answer that question. 

THE WITNESS: To the best of my recollection, it was 

during the early part of the second half of 1986. 

BY MR. LIMAN: 

Q And since you have been cooperating with us in gettir^j 

records together for production for us, have you seen those 

records? 

A The only way that I can answer your question is — 

I understand your question to mean — 

Q Do you have any recollection of having seen them in 

the last month or two? 

A No. 

Q No recollection of having seen them in the last month 

The — they were, as I understand it, computer print-outs? 

A CSF computer print-outs. 
■ fa ■ A- - ->. A.^ 



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\ " MR. JANIS: Among other records. 

2 BY MR. LIMAN: 

3 Q What were the other records that you saw with Mr. 

4 Secord? 

5 A Well, if we can agree to some of the figures, they 

6 showed us a backup, or they looked at the backup documents. 

7 Q So, you and General Secord would look at the records 

8 and if you saw something that seemed to be a discrepancy, you 

9 would ask for the backup records? 

10 A Or ask them to go back and — we gave them what we 
^^ thought it should be. We told them what it should be. They 
^2 went back and checked and we finally agreed, 

13 Q Did these records have different accounts such as 
^* capital account, accounts payable, accounts receivable? Did 
^* they have that kind of ledger system? 

16 A I don't think they exactly worked like that. 

17 Q Describe them as best you can? 

18 A They would tell us what was happening to each 
company. 

Q What does that mean? 

A Well, we had a number of companies that we were using 
Energy Resources, Lake, Hyde Park, and so on. 
2' Q What does it mean, what was happening to each 
24 



company? 

A What was in it. 



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1 - Q It would show the balance? 

2 A Show the balance. And all the other companies that Vo 

3 have the list of; and also showed the — showed us the monies 

4 that we had received. 

5 Q Showed the activity in the account? 

6 A Yes. That is fair to say in a very general form. 

7 Q Now — 

8 A Monies in and out of these, and what was — excuse me, 

9 monies in and out and what was the bottom line. 

10 Q When you refer to the bottom line, are you referring 
to an entry that showed what the balance was? 

12 A Of the total of the activities. For instance, 

^^ SciTech, so much; Korel, so much; Hyde Park, so much. 

14 Q So, there was a sheet which showed you the balance inl 

^' each of these entities and then totalled them up? 

A Yes. 

Q Did they show you a record that allocated any of the 
^® balanced between you and General Secord and anyone else? 



A You are talking about the capital accounts? 

Q Or profit accounts? 

A Profit accounts? They were — for General Secord, 
I had a company totally for a different purpose, that I allocai 
that company for -- to park, if you will, Mr. Secord 's — 

Q Profits? 



A — profits. . ' V 



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1 Q That is Korel you are talking about? 

2 A That is right. Then mine was under my own name. 

3 Q Right. And you testified, as I understood it 

4 yesterday, that the $4 million that was in CDs was really a 

5 reserve and was incorrectly allocated to your profit account? 
8 Am I — did I understand that is what you said yesterday? 

7 A No. 

8 MR. JANIS: That is not correct. 

9 MR. LIMAN: Then I am sorry. 
'0 BY MR. LIMAN: 

11 Q The $4 million was a reserve, is the way you describee 

^^ it yesterday? 

13 p^ The way I described it yesterday, we went through that 

' organization chart. 

Q Yes. 

A In the Tower report. I explained the purpose and the 
reason behind creation of that, and how it worked, and if you 
look at that chart, you will see that the outside of the 
operational, there is a CSF investment with an R, which is not 
the continuation of the — 

Q The R is reserve? 

A The R is reserve, yes. 

Q And as I understand it, just so that I can finish 
this, that when you saw the most recent records that were 
produced by Zucker, those records had allocated what you 

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' considered to be the R to your capital account? 

2 A That is correct. 

3 Q And you think that is wrong? That was not your 
intention? 

* A I don't know under what circumstances Mr. Zucker has 
" prepared his so-called ledger. 

' Q He didn't discuss that with you before he allocated i 
to you? 

A No. No. But I know what my instructions were. 
Q Just keep it as an R? 

A And how. And I differentiated and I told him that 
they should be kept separately. He asked me under what account 
I told him I started to give subtitles to my name, AH-1, 
AH-2, AH-3. 



Q Was the R only in the CSF bnk account? 

A 

A I don't understand the question. 
MR. LIMAN: Lou? 
EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 
BY MR. ZANARDI: 
Q The $2 million or $4 million that we see, that is in 
the — your account, your capital account, what bank account 
was that held in? Was it in one of your bank accounts , or was 
it in the CSF bank account? Do you know where it was held? 

A It was not supposed to be kept in a bank account. It 
was supposed to be in CSF investr:ient. It was supposed to be 



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3 
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invested. It was not a cash deposit as testified by Mr. 
Secord. 

MR. JANIS: You mean certificate of deposit? 
THE WITNESS: Certificate of deposit. 
EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 
BY MR. LIIIAN: 
Q And do I understand Farina is no longer with Mr. 
Zucker? 

A That is my understanding. 
Q What doe s he do now? 
A I have no idea. 

MR. LIMAN. Why don't we take our break now. 
(Whereupon, at 12:40 p.m., the taking of the 
deposition was recessed, to reconvene at 1:00 p.m., the same 
day.) 





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1 

2 

3 

4 

5 

6 

7 

8 

9 

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IS 

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BY MR. LIMAN: 

Q Mr. Hakim, before the lunch breaX, you testified 
about the fact that you had this relationship and trust with 
Mr. Zucker? 

A Yes. 

Q Is it not also so that there was a written agreement 
with Zucker, CSF, that authorized them to take instructions? 

A Instructions from? 

^ Well, let's take it from you, for example. Didn't 
you sign a fiduciary agreement with him? 

A I signed fiduciary agreements with them, but I 
don't recall the text of those agreements giving them anything 
in that context. 

Q General Secord, for exaitple, testified he signed a 
fiduciary agreement with Mr. Zucker? 

A Yes. 

Q I assume that you had some kind of either fiduciary 
or management agreement that you also signed with Zucker? 

A Yes. 

Q Now, is it not customary in your experience for 
Swiss institutions like ficudiaries, to ask that there be 
something in writing that tells them from whom they can take 
instructions? 

A The ones that I have come across relates to me, 
names me as the beneficiary of that financial activity. 



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Q And that you can give instructions? 

1 A Yes. 

2 Q Now, in the case of this group of companies, was 

3 there a writing that indicated who was the beneficiary? 

4 A To the best of my recollection — you are now 

5 referring to a number of fiduciary agreements — 

6 Q Right. 

7 A -- for as many companies and accounts there are and 

8 as many as I have signed? 

9 Q Right. 

10 A The standard form Mr. Zucker has and it just names 

11 me? 

12 Q Didany of those agreements indicate that he could 

13 take instructions from General Secord? 

14 A To the best of my recollection there is no such 

15 document as far as I CAN REMEMBER. 

lg Q So that the agreements were agreements under which 

17 you could give the instructions, correct? 

18 A That is correct. 

19 Q And they named you as the benef icilal owner? 

20 A That is my recollection. 

21 Q But from time to time I think you testified that 

22 General Secord was able to give directions directly to Mr. 

23 Zucker? 

24 A There came a time that he could do that. 

25 Q And that came in 1986? 



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A I think so, yes. 

1 "' Q Why was it, since you were partners in the energy 

2 account, to take that as an example, you didn't name General 

3 Secord as the beneficial owner along with yourself? 

4 A To begin with, these agreements, which you call 

5 fiduciary agreements, they were not really signed until it 

6 became necessary for Mr. Zucker to have them for Ms. Miles. 

7 Q When was that, recently? 

8 A Not all of them, most of them. And that was — 

9 all depends what your interpretation of recently is. 

10 Q Since November? 

11 A Yes. 

12 Q Since November most of them were signed? 

13 A Yes. 

14 Q Until then it was done orally? | 

\ 

15 A That is correct. Most of them. Most of them. ; 

16 Q Which ones were signed earlier? 

17 MR. JANIS: If you know. 

18 MR. LIMAN: If you recall. 

19 THE WITNESS: To the best of my recollection, ther 

20 were three fiduciary agreements signed under the annotation 

21 AH-1 euid AH-2, where we had the reserve monies. It didn't 

22 name any one particular company, it neunes me. These are the 

23 accounts that I provided the will for — 

24 BY MR. LIMAN: 

25 Q Provided the will under which General Secord 



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UNCLASSIFIED 

could designate what happened to the money if something 

1 happened to you? 

2 A Right. 

3 Q The others -- for example, the energy account, ther 

4 was no written agreement until recently? 

5 A Yes. 

6 Q Until after November? 

7 (The witness nods his head) 

8 MR. LIMAN: YOu have to say yes for the reporter. 

9 THE WITNESS: yes. 

10 MR. VAN CLEVE: If I might, on the question of the 

11 will that you described, you gave General Secord a power of 

12 attorney in the will. Is that wha* was done? 

13 THE WITNESS: I don't remember the text of it, but 

14 it had that value. 

15 BY MR. LIMAN: 

16 Q Was it a will or a power of attorney? 

17 A It was a will. 



Q And you gave the will to Mr. Zucker? 



19 A Yes, 



MR. Janis; Excuse me. 

(Mr. Janis is conferring with the witness) 
THE WITNESS: I recall that there were two wills 
now. Because there were two $2 million deposits. 

24 BY MR. LIMAN: 

25 Q So there was a will for each of the deposits? 



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A Yes. There was a will — to the best of my 

1 -recollection, there was a will in connection with the first 

2 $2 million reserve that named General Secord and in case of 

3 my death, and the second -- it could be the first one I 

4 don't remember which one was first or second -- I should say 

5 one of them named him the beneficiary after my death and the 

6 other named Secord and in the event of his death, Oliver North 

7 as the beneficiary in that reserve account. 

8 MR. VAN CLEVE: The purpose of these arrangements? 

9 THE WITNESS: He wanted the operation to go on. 

10 We did not know how it would go on or what would happen, and 

11 therefore, I followed the sequence from the lower level up 

12 to the level of command, if you will. And the reason — 

13 MR. LIMAN: What does that mean? 

14 THE WITNESS: From me to Secord to Oliver North. 

15 MR. LIMAN: North being the top? 

16 THE WITNESS: Yes. 

17 MR. VAN CLEVE; Was North ever told he was 

18 designated as a beneficiary of your will? 
MR. HAKIM: He might have, I don't recall now. 
MR. VAN CLEVE: Did you personally ever tell him? 
THE WITNESS: I might have, I reVally don't recall. 

I was not in such regular contact with North. 
BY MR. LIMAN: 
Q Did General Secord ask you in this second document 
that named North to include North? 

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A No. Both wills I volunteered,! proposed. They 

1 did not even think about it. 

2 BY MR. VAN CLEVE : 

3 Q Was this your idea? 

4 A Absolutely, 

5 Q Or was it suggested by someone else? 

6 A Absolutely my idea. 

7 BY MR. LIMAN; 

8 Q Why was it that you didn't simply designate Secord 

9 as having power of attorney whether you were alive or not? 

10 MR. JANIS: Excuse me. 

11 (Mr. Janis is conferring with the witness) 

12 THE WITNESS: The commitments that really existed 

13 towards a lot of interested parties, effectively my 

14 resposibility. 

15 BY MR. LIMAN: 

16 Q What does that mean — interested parties? 

17 A Well, if you focus on the arrangement, how we 

18 operated, in this covert activity, or at least that is the 

19 way I classified it — I do not go by the same categorization 

20 that General Secord or a military goes, you know. I took all 

21 of this input and used my businessman's points of reference 

22 and designed things the way I saw them, in interpreted them. 

23 I saw three distinct functions: I saw here at the 

24 top a political function — Oliver North sitting in there, anc 

25 whoever was around him^, inside, outside, with him. That was 



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his business. 

1 - I saw next to me here. General Secord and his 

2 operational responsibility, with an overlap of a financial 

3 activity around me. So that is the way I saw the total 

4 picture. 

5 Q So you saw North policy, Secord operations, you 

6 finance? 

7 A And with an overlap. 

8 Q With a necessary overlap of these different circles 

9 A Yes. Basically with — 

10 Q Let's go back to energy. Energy was a company -- 

11 A I didn't — there is an outstanding question that 

12 I did not answer. I believe it was your question. 

13 Why I designed the wills the way I did. 

14 Q Right. 

15 A The purpose was General Secord was reasonably 

16 aware, and I underline reasonably aware, of my obligations 

17 toward certain Iranian individuals who assisted me to open 

18 the second channel and I defintely wanted their interest to 

19 be protected at the level of the private group, and not get 

20 into the hands of officials. 

21 And the second group — these are all my 

22 categorization, I want to underline that — the way I saw 

23 them, that is the way I used/V judgment. 

24 And the second one, I thought that the officials 

25 should have access to them. So that is why I designed it the 






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way I did. 

1 "' Q So the first — 

2 A I don't remember which one was first. 

3 Q On one of the $2 million accounts you envisioned 

4 that that money would be used to 

5 A In case of my death. 

6 Q In case of our death, to take care of some of the 

7 people who helped? 

8 A My commitments to people. 

9 Q And General Secord could — 

10 A Could use some of those people. 

11 Q Could see to it that that was done? 

12 A It was not exactly — so he knew of the people, 

13 people that helped me to open the second channel. They were 

14 in contact with General Secord as well. As a matter of fact 
15 

16 Q Was there any agreement they would get part of that? 

17 A You may find this stra^ngfand then you may not. 

18 In the Middle East there is a lot of lack of trust until they 

19 trust you. And when they trust you -- there was quite a bit 



20 of trust, I w9^ to underline. 

21 Q But no agrMhent? 

22 A Not only no agreement. The Iranians, Mr. Liman , 

23 they are raised to put themselves in the hands of their 

24 leaders, if you will. They think differently. They thought 

25 they were in good hands. They still think they are in good 



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WIASSW 



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hands. Secord knew some of the people, and he knew they had 

1 "a commitment. 

2 MR. VAN CLEVE: Did you talk with him about the 

3 necessity of carrying through on that kind of commitment? 

4 THE WITNESS: I told — everybody knew. It was 

5 open. It was not a secret. All along — I don't know whether 

6 we will get into those or not, but in all discussions that I 

7 had with officials present as well, and by officials, I refer 

S 

8 to Mr. Cave, Mr. North. I never, never made it a Secret that 

9 there is a profit motivation, there is a financial interest 

10 there. I joked about it. I said you are all soldiers, you 

11 get the medals, I get the money. It was nothing that was 

12 not known. It was an open issue. 

13 BY MR. VAN CLEVE: 

14 Q So the record is clear, this is in connection with 

15 the Iranian arms sales? 

16 A Yes. I am focusing — 

17 Q General Secord knew this? A 

18 A General Secord kew this , North knew this , Cave 

19 knew this. I believe there are recordings. That is my beliel 

20 BY MR. LIMAN: 

21 Q The question, as I understood it a moment ag^o was 

22 did General Secord know that out of the $2 million, the' one, 

23 #2 million, that he was going to have to take care of some 

24 people if something happened to you? 

25 A He knew that, and the people knew that, as a 

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WlASSiflffl 



105 



ro\AJet^ 

matter of fact, in the tsax report I learned later that 
General Secord referred to my associates as his agent. So 

2 these people were very well known to the group. As a matter 

3 of fact, before we brought him into the group, they had to 

4 take a lie detector test. I went through that. It was known. 

5 Q Mr. Hakim, was he told how much of the $2 million 

6 would have to be used for that purpose? 

7 A The focus was not on $2 million, the focus was not 

8 on how much. The how much was never defined. 

9 Q So the answer is not, it wasn't defined? 

10 A It was not defined. It was — it is important, 

11 Mr. Liman, to understand that it was under — it was an 

12 obligation, and there should be a reserve for that obligation. 

13 That was the whole purpose of this exercise. 

14 Q And what about the other $2 million, what was that 

15 to be used for? The one that North and Secord both had power 

16 over in your will? 

^j A I was — along the lines that I was thinking that 

18 if something should happen to me, I had already introduced — 

19 I am not talking about Iranian Government officials, mind 

20 you. 

21 Q Yes. 
A The people who had helped me to put the package 

together, they were known both to Secord, Cave and North as 
well as George Cave. My thinking was in case of my death, 
you know, that association had to continue and go on to 

IIMni AQQiPJED 



274 



UNCLASSIFIED 



106 



furthering the relationship. The only thing that would have 

1 liappened, I would be out of it. 

2 Q Who were these people? 

3 MR. VAN CLEVE: General category now, not specif i- 

4 cally. 

5 BY MR. LIMAN: 

6 Q You can write that down on a piece of paper, which 

7 we will reserve for — if you write them down, we will 

8 restrict it to the majority and minority counsel of the House 

9 and myself. I know it is sensitive. 

10 A You have to step in here. 

11 MR. JANIS: Part of the problem is Mr. Hakim has 

12 told me, and I have no reason to doubt this, if the identities 

13 of these people become known, it is not possible they will 

14 bel(llled, it is probable they would be killed. 

15 BY MR. LIMAN: 

16 Q What kinds of people are you talking about? 

17 A Ireuiians. 

18 Q Private Iranians? 

19 A Also. 

20 Q I am talking now about the $2 million that North 

21 and Secord would have control over, that was not to be used 

22 for government officials. That is what I thought you were 

23 talking cibout. 

24 A What I am saying is — what I said was I wanted a 

25 portion of reserved, not to get into the hands of the 



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mmm 



107 



government officials. I did not say that — I did not break 

1 it down that this was meant for Iranians and it was meant for 

2 their fees. The total picture, Mr. Liman, and didn't change. 

3 We had an operation to run. You may find this thing difficult 

4 to — 

5 Q I am trying to understand what — 

6 A We have a total reserve and this was to be used for 

7 a number of things. We had to run our operation. 

8 Q But that was like capital, right? To run an 

9 operation you need capital? 

10 A That operation you need capital to — you need 

11 running operation, but then you need other facilities, 

12 especially for covert activity, such as self-insurance, 

13 reserve for unforeseen operational expenses. The way I was 

14 looking at this whole enterprise, that it is a start-up 

15 company, has a lot of unforeseens. Every day was a new day, 

16 a new requirement. I had obligations to the Iranians, I had 

17 obligations to insurance, I had operational obligations. 

18 There were monies that were in the companies that were being 

19 used for operational purposes. 

20 Q But your distinction for us between $2 million that 

21 Secord alone would have the control over, and the $2 million 

22 that Oliver North 2md Secord would have control over, what 

23 was that other $2 million to be used for, that North and 

24 Secord would control? 

25 A The distinction comes from the fact that on two 

ll lllklAI s AAirir-ii^ 



276 



minsw 



108 



occasions I signed two fiduciary agreements, and I put aside 

^ for reserve two, $2 million. It was not -- it was there, so 

2 I could not draw a will to say that he has access to -- that 

■^ facility was there, it was convenient for me to write the 

* will based on what was available in the enterprise. 
^ Q So that if I understand what you are saying, that 

^ both of these reserves were available to be used for the same 

^ purpose? 

8 A The purpose of the enterprise. 

9 Q Correct. 
10 A Yes. 

■•1 Q And that the reason that Oliver North was named 

12 in one but not the other was that you signed these at two 

13 different times. Is that the reason? 

1* A We had two different reserves. 

15 Q And they were signed at two different times, were 

16 they not? 

17 A The fiduciary agreements? 

18 Q Yes. 

19 A That is correct. 

20 Q And when you signed one of them you put Oliver 

21 North in — 

22 A But the wills were written at the seune time. 

23 Q The wills were? 

24 A The wills were written at the same time. 
Q Then why was it that you were proposed to give 



277 



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Oliver North some control over $2 million if something 

1 happened to General Secord, but not over the $4 million? 

2 A Because my understanding was for Oliver North to 

3 get involved making payments to Iranians that could possibly 

4 include some officials in them would be not proper for him 

5 being an official of the government. 

6 Q So that you gave Secord the power over the $4 

7 million because you contemplated that some of that money 

8 might have to be used for the Iranian officials? 

9 A Yes. 

10 Q And North's control over the $2 million vas limited 

11 to that $2 million because you had contempated that he would 

12 not be dispensing that money to Iranian officials? 

13 A Exactly. 

14 Q Now, who would he be disbursing money to, what 

u 

15 kinds of things did you contempate he would — 

16 A To continue the operation. 

17 Q Now, when did you sign those wills? 

18 A I honestly don't remember, sir. 

19 Q After November ' 86? 

20 A Oh, no, no. 

21 Q Did you sign these wills at the time that you 

22 created the reserves? 

23 A If not right away, shortly thereafter. 

24 Q Now, the reserves were created -- one of them was 

25 created in, as I recall, February of 1986, and the other was 



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UNCUSSIFIED 



110 



created in May of '86. Do you recall that? 

1 - A I have to refer to — 

2 Q May of '86 is when you had the Tehran trip and 

3 the first S2 million was created at the time that the thousand 

4 Tows were sent? ' 

5 MR. JANIS: March 5 and June 18. 

6 BY MR. LIMAN: 

7 Q And when was it that you opened the second channel? 

8 A The second channel, we started our efforts in July. 

9 In September the agency and Oliver North were satisfied that 

10 these people passed the test. 

11 Q So that well before these people passed the test, 

12 you had created a will which gave Oliver North some control 

13 over $2 million if you and Secord dies, right? 

14 A I thought I said that it was either then or shortly 

15 after. And I said I don't recall the date. 

16 Q Who has these documents? 

17 A They should be with Mr. Zucker. 

18 Q And you don't have a copy of them? 

19 A Not to the best of my recollection, no. 

20 MR. LIMAN: We would request that you ask Mr. 

21 Zucker for these documents as soon as possible. 

22 MR. VAN CLEVE: Did he draft them? 

23 THE WITNESS: Yes. 

24 BY MR. LIMAN: 

25 Q Were these — we have called them wills. In the 



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United States a will is something where you dispose of all you 

1 "property. These I take it were not that kind of will. These 

2 were what I would call testamentary instructions, instructions 

3 to Zucker as to what would happen to these particular funds 

4 in the event of your death. Is that correct? 

5 A I can't give you a legal opinion. 

6 Q Was this a will in which you took care of your 

7 family and everyone else? 

8 A No. 

9 Q It was really an instruction to Zucker that in the 

10 event of our death this is what was to happen? 

11 A Yes. 

12 Q Did Secord issue instructions like that to Zucker 

13 as to what was to happen in the event of his death? 

14 A I am not aware of that. 

15 Q Or North, did he issue that? 

16 A I am not aware of them. 

17 Q Did North ever meet Zucker to your knowledge? 

18 A To my knowledge, I don't think so. 

19 Q Did you give a copy of these instructions to 

20 General Secord? 

21 A I don't remember doing that. 

22 Q Or to Oliver North? 

23 A I don't remember doing that. 

24 Q Now, I wanted to just go back to where you started 

25 when we got into this. Energy was a company, a vehicle for 



280 



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112 



both you and General Secord, correct? 

1 A When you say vehicle for — 

2 Q A corporate entity that you were gpUopg to use for 

3 the sales to the contras? 

4 A That is -- I can relate to that, yes. 

5 Q And you were each to share equally in the profits? 

6 A Of the contra sale? 

7 Q Yes . 

8 A Yes . 

9 Q Then why was it that you put this company in your 

10 name as opposed to being in the «oint names of you and 

11 General Secord? 

12 A For a number of reasons. To begin with, I told 

13 you that this did not happen until later. 

14 Q Right. 

15 A Secondly, General Secord was going through a 

16 transitional period whether he Weinted to remain a businessman 

17 or wanted to go back to the government. His position 

18 fluctuated, and then it was not necessary, because there was 

19 no need for him — 

20 Q In November — before November of '86, or whenever 

21 it was that you signed the ^reement with Zucker on energy in 

22 which — in which you registered as the beneficiary -- 

23 A After the revelation, Mr. Zucker Ccime to my hotel 

24 with a whole bunch of documents and I signed to cover him. 

25 Q Now, before that you trusted Zucker that Zucker 

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UNCUSSinED 



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would recognize that this money was yours, right? 

1 A Yes. 

2 Q Without any written documents? 

3 A Yes . 

4 Q And is the same true that General Secord trusted 

5 you, that you would share the profits withv\im without a 
*> written document? 

7 A I should hope so. There was no written agreement 

8 between us. 

9 Q There was just an oral understanding? 

10 A Yes. 

11 Q And when Zucker came to you to sign the papers, 

12 did you have any discussion that you didn't want General 

13 Secord' s name to appear? 

14 A You are talking about the fiduciary agreements 

15 in connection with companies? 

16 Q When it came after the revelations in November, 

17 yes sir. 

18 A Mr. Zucker came to my hotel room. 

19 Q Where? 

20 A In Geneva. 

21 Q Right. 

22 A Very much disturbed, panicky, looked totally 

23 devastated. And I did not, I wemt to go on record that I 

24 did not read those agreements to come forth him, because I 

25 felt responsible for dragging him into something that he had 



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114 



no knowledge of. I signed all those documents and gave 

1 them to him. 

2 Q Have you read them to this day? 

3 A No. 

4 Q Then do you know Whether they named General Secord? 

5 If you haven't read them? 

6 A If they did, they don't have the signature, to the 

7 best of my knowledge. 

8 Q You are the only one who signed the ones there? 

9 A Right. 

10 Q Do you know whether or not he is designated in 

11 those agreements as someone who can draw on the accounts? 

12 A He assured me it was the standard form that -- 

13 MR. JANIS: Answer his question. Do you know 

14 whether General Secord is desigaated? 

15 THE WITNESS: I don't know. 

16 BY MR. LIMAN: 

17 Q Did you ask Mr. Zucker not to put General Secord' s 
16 name on any of these compeuiies? 

19 A No 

20 MR. VAN CLEVE: Did Mr. Zucker tell you why he 

21 wanted you to execute these agreements? 

22 THE WITNESS: Because of the Swiss laws. 

23 BY MR. LIMAN: 

24 Q He wanted his own protection? 

25 A His own protection. 



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UNCLASSIHED 



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Q Now, Mr. Zucker knew that Secord was a partner of 

1 "yours in Energy, didn't he? 

2 A I don't know whether he looked. at it that way. 

3 Q Did you tell him that Secord was sharing with you 

4 50-50? 

5 A The contra deals? 

6 Q Yes. That is what you did with Energy, right? 

7 A We did most of our work with Mr. Farina. 

8 Q Did Farina, did you ever tell Farina — 

9 A Yes. 

10 Q — That Secord was your partner? 

11 A Yes. In connection with the distribution of 

12 profits. 

13 Q And Farina was then Zucker' s employee? 

14 A Employee. 

15 Q Did you have any discussion with Zucker as to why 

16 he was not putting Secord down as a beneficial owner of 

17 Energy? 

18 A You mean in November when he came there? 

19 Q Yes. 

20 A I said I didn't even read it. 

21 Q What about SciTech? There was a partnership of 

22 you and General Secord, correct? 

23 A A company meant for that purpose, yes, that is 

24 correct. The answer is yes. 

25 Q Is General Secord listed as a bene^iaal owner of 



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116 



it? 

1 " A I believe those documents related to SciTech also 

2 were signed at the same time. 

3 Q You don't know whether he is listed as a beneficial 

4 owner or not? 

5 A Correct. 

6 Q Did you have any discussion with General Secord 

7 to the effect that you -^flruld not disclose that General Secord 

8 was a beneficial owner of any of these companies? 

9 A At any time? 

10 Q yes. 

11 A It is possible. I don't remember. And the reason 

12 I say it is possible is when he told me that he wanted to go 

13 back to the government, I find it to be my normal reaction to 

14 tell him his signature would not appear on those. That is wh} 

15 I say it is possible. 

16 MR. VAN CLEVE: Did you and General Secord ever 

17 talk about the application of United States tax law to these 

18 entities? 

19 THE WITNESS: No. 

20 MR. VAN CLEVE: You never did? 

21 THE WITNESS: No. 

22 BY MR. LIMAN: 

23 Q Now, I want to follow up on that last answer of i 

24 yours, where you said you knew he was going to go back to the 

25 government, he shouldn't have his name on any Swiss Bank 

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11 



19 
20 
21 
22 
23 
24 
25 



!!^?^USSIFIEO 



117 



accounts or Swiss entities? 
^ - f^ I said that it would have been my normal reaction 

2 1 if I told him. 

3 But if you look at the records that we have, there 

4 continues to be a profit allocation. We just saw one in 

5 August of 1986 to general Secord, correct? 

6 A Yes. 

7 Q So that even though his name wouldn't appear, he 

8 would still get the profit allocation? 

9 A Yes. 

10 Q And what was the purpose of using Korel as opposed 
to General Secord' s name so that his name wouldn't appear on 

12 any Swiss records? 

13 A Not really. That purpose could have been served 

14 also at the S2une time. 

15 Q Maybe I should have put it differently. Was the 

16 reason you didn't use his name on the records so that he 

17 would have anonymity? 

18 A When we started to do that, it could have had 
that reason, but it was easier also to manage the money and 
so forth through another person. 

Q Your name appears ~ Hakim appears. 

A He came at a later date. 

Q When yousay a later date, originally your name 

didn't appear on it? 

A I didn't even keep a company with my name on it. 

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To this date, Mr. Liman. 

1 Q Your lawyer has something to say and then I want 

2 to say something to you. 

3 MR. JANIS: I think the question he is asking you 

4 is where — 

5 MR. LIMAN: Let me rephrase it. If I miss you 

6 tell m and you can put the question. 

7 BY MR. LIMAN: 

8 Q I undersB^d that General Secord is your partner 

9 and you have a good deal of respect for him, correct? 

10 A Yes sir. 

11 Q But you understand that you are under oath and 

12 that you have got to let everything hang out, right? 

13 A I understand that perfectly well. 

14 Q And the question that I am really putting to you 

15 is whether you made em effort to keep Generalpecord' s ncune 

16 off of the Swiss records of these companies? 

17 A Yes. 

18 Q Thank you. 

19 A That question was clear. 

20 MR. LIMAN: You don't want to pick up? 

21 BY MR. VAN CLEVE: 

22 A The records reflect declarations of profits at 

23 least through late July of 1986 to the account that you have 

24 identified as being General Secord" s account. Was it your 

25 intention he would receive those profits? 



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A At what time, sir? 

1 -- Q As of late July |?86. 

2 MR. JANIS: Do you understand the question? The 

3 question is a little confusing. 

4 THE WITNESS: The question is not complete. 

5 MR. WECHSLER: Which profits are you talking about? 

6 MR. VAN CLEVE: The ones we looked at this morning. 

7 MR. WECHSLER: They went in August, August 27. 

8 MR. VAN CLEVE: Excuse me, I stand corrected. We 

9 now have the treinsaction in mind. 

10 BY MR. VAN CLEVE: 

11 Q The records we examined this morning show a 

12 declaration of profits from the stranded shipment arms sale 

13 in lage August 1986. Was it your intention at that time that 

14 part of those profits would go to General Secord? 

15 A To go to the account of Korel that I have kept. 

16 Q And you identify as General Secord' s account? 

17 A Of General Secord' s account. Should he change his 

18 mind and want to repossess his profits. He had foresworn 

19 those profits to me at a time that he, the same way he r-^acted 

20 in the hearings when he gave away all the money to Casey's 

21 foundation, I know, he got in one of those moods and said 

22 he had to go back to government and put a foundation straight, 

23 and he didn't want to have anything to do with these funds, 

24 they were mine. 

25 MR. LIMAN: That was done orally? 

llMn Aooinrn 



288 



icussra 



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THE WITNESS: Yes. 

1 "' BY MR. LIMAN: 

2 Q Nothing was ever signed on that? 

3 A No. 

4 Q And after that date he wrote those wills? 

5 A Mr. Liman, I really have to look at that document 

6 to give you a precise answer. I am not trying to play cute, 

7 I am trying to be accurate? 

8 Q After that date the record shows monies went to 

9 General Secord? 

10 A I did not change the pattern. 

11 Q The monies actually went to him? 

12 A Yes. I did not change the pattern. 

13 Q And monies he had invested in American — whatever 

14 was -- Tri-American Arms — for his benefit? 

15 A Mr. Liman, I did not chemge my pattern. 

16 Q And he didn't say don't invest Snoney in Tri- 

17 American Arms for me? 

18 A I don't — 

19 Q That was his deal. He is the one who met up with 

20 these con-men? 

21 A He wanted me to invest. 

he. wa'? 

22 Q For him. He said h^vas supposed to be a partner, 

23 he testified to that. 

24 A You can conclude that, yes. 

25 Q I am only concluding it from what he said. 

illlAI •AAlMPii 



289 



iiNcussm 



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A Your conclusion is logical. What I am trying to, 

1 when we discussed it we did not go into such technicalities. 

2 Q ;^art from logical, it is truthful, isn't it, that 

3 was a partnership — Tri American was a partnership? 

4 A Yes, Mr. Liman. 

5 Q And that he was a partner? 

6 A Yes, Mr. Liman. 

7 Q And that you put in the money for his benefit as 

8 well as for yours? 

9 A Yes sir. 

10 BY MR. VAN CLEVE : 

11 Q When you and General Secord discussed the 

12 possibility he would foreswear profits from various 

13 transactions, did you ever discuss the possibility he might 

14 want to repossess these profits at a later date and they 

15 should be held for him in some form? 

16 A General Secord was born a general and will die a 

17 general. Generals have a special way of thinking. If you 

18 deal with them long enough you learn how to deal with them. 

19 When he said that, I understood what his frustrations were. 

20 I also understood that he had an old wound from his previous 

21 employment in government. I understood his psychology. That 

22 was his position. He was sincere about that position. He 

23 meant what he said. I still believed that he meant what he 

24 said. 

25 I believed him when he said give all the money 



!iMni K<jiFiFn 



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mp] h 



m 



iV 




122-130 



to Casey's Foundation. But I am a businessman, I am more 

1 realistic than he is. I live in a different world than he 

2 does. So I did not need to go back, sit down and discuss 

3 things with him. 

4 There were so many unljtowns. I did not know he was 

5 going to go back to the government. I did not know whether 

6 he was going to change his mind. He made a statement, I 

7 listened to him, I kept them aside, I went on with my business 

8 I respect my own ideal and my own ethics. In my mind, I 

9 considered that he deserves the commission. I still think he 

10 does. 

11 I think he is unrealistic. He is unrealistic 

12 altogether. He is in a different world, in my opinion. It 

13 is not that he is not truthful, he is. But he is unrealistic. 

14 So I went on with my own way of doing things. He is my 

15 partner, I treated him like one then. I still am treating 

16 him like one today. I am helping him in any form I can now 

17 financially or otherwise. I have a different attitude towards 

end Dotsonisl these things, 
end mhl 

19 



20 
21 
22 
23 
24 
25 



^^^00^ 



291 



UNCUSSIFIED 



131 



Q With due respect, Mr. Hakim, my question was 
when General Secord told you that he was going to forswear 
his interest in the profits of these various transactions, 
did you and he ever discuss the possibility that he might 
wish to re-possess those profits at some time? 

A That was not discussed and I did not bring it up. 

Q You never had such a discussion? 

A No. 

Q Okay. May I ask you to take the book we were looking 
at before we broke and return to page 11. I am sorry to take 
you through this in detail, because I know it is rather tedious. 
I believe your testimony was you were the person who organized 
SciTech. Therefore, I think you are probably in the best 
position to tell us what the various disbursements are about. 

A Not necessarily, but I give it my best shot. 

Q I appreciate that. I am going to try to take you 
over the larger disbursements. The third entry is August 28, 
1985, transfer from Lake Resources to SciTech in the amount of 
$48,560. Can you tell us would that have been used for the 
contra project or the Iran project or some unrelated project? 

A Are you asking me this question for bookkeeping 
purposes? 

Q Basically. I am sorry to put you in that position. 
We are trying to do some allocations. 



UNCliSfllflFn 



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132 



""A If I understand you correctly — I don't have knowledg 
of it, but looking at the date, I don't believe in August 
1985 we had started with the Iranian initiative. If STTGI/ 
SciTech had incurred any expenses and monies needed to be 
transferred to it that date, and if I recall correctly the 
Irianian initiative had not started, I would have allocated to 
the contras. 

Q Do you recall anything at all about the circumstances 
of the disbursement? 

A No, I don't. 

Q Moving down slightly, on the 14th of November, 
1985, there is a transfer from Lake Resources to SciTech, 
$67,340. Are you familiar with the circumstances of that 
transfer? 

A I am not, sir. 

MR. JANIS: May we go off the record? 
(Discussion off the record.) 
MR. JANIS: Let's go back on the record. 
If I understand, I have consulted with the committee, 
if I understand, page 11 of Deposition Exhibit 3, this only 
demonstrates the money that went out of one of these accounts 
into SciTech, but it doesn't reveal whether the money 
thereafter went from SciTech for some other purpose including 
operational purposes. 

Mr. VAN CLEVE: Sure. 



UNCLASSIFIED 



293 



UNCLASSIFIED 



133 



MR. JANIS: I am rightabout that, am I not? 

MR. ZANARDI: Yes, except for the TriAmerican Arms 
and the K. Phillips' disbursements, that would be indicated in 
a separate term. 

MR. JANIS: This money may well have gone into 
SciTech and out for some other purpose, including an 
operational purpose? 

MR. ZANARDI: Absolutely. The journal would show 
you where it goes. This is Hakim Exhibit 1836. 

MR. JANIS: What I would suggest is when we go to 
the other Hakim Exhibit at emother point, you may want to do 
that, but for purposes of this exhibit, I think that it really 
can't respond to the — this particular page, because monies 
apparently went into SciTech and went someplace else. 

MR. VAN CLEVE: Your point is well taken. Do we 
have a document that will show the transfers out as to each of 
these? We do want to make the allocations. We might as well 
use the primary document. 

I don't understand why it was done this way. 

MR. ZANARDI: Just off the record for a second. 

(Discussion off the record.) 

MR. ZANARDI: The reason why it was done this way is 
because the journal didn't go beyond the distributions that 
were in the general ledger. The other informaticn provided 
by Mr. Hakim has broken that down further. 

mini Aonirirn 



294 



UNCUSSIFIEB 



134 



That is in Exhibit H-1837. Not exhibit, but 
document number. 

MR. JANIS: Can we have this marked? 

MR. ZANARDI : That is the only copy I have. 

(Discussion off the record.) 

BY MR. VAN CLEVE: 
Q I ask you to turn to page 13 of the Exhibit, 
Exhibit 3, please. 
A Thirteen. 

Q Yes. Now, these are transfers to STTGI from various 
accounts and you will notice that the first six transfers 
are transfers from Energy Resources to STTGI and they are 
designated on here as Secord loan transactions. Just very 
roughly, it appears that they amount to about $135,000 and they 
are made between early February and — Early September 198 5. 

MR. JANIS: May I ask a question here? 

MR. VAN CLEVE: Sure. 

MR. JANIS: The document indicates Secord loan for 
the first six or eight transactions. Can you show us where in 
the records — that is your conclusion or that is a 
conclusion on the document prepared by the committee. I think 
we should have the original. 

MR. ZANARDI: I would say that — I will give you the 
original copies of the disbursements. The allocation of 
loan was based on Mr. Secord 's testimony 



295 



OHCUiSSinED 



135 



The records provided to us had no indication whether 
it was a loan or not. 

MR. JANIS: To the extent there is a notation on 
this document that says "Secord loan", that conclusion is 
not based on the documents themselves, but rather on your 
interpretation of Secord 's testimony? 

MR. ZANARDI : That is correct. So I would disregard 
any indication of whether that is a loan or not. 
MR. VAN CLEVE: Okay. 
BY MR. VAN CLEVE: 

Q Do you have an independent knowledge, Mr. Hakim, 
as to whether or not these particular disbursements did in 
fact represent a loan to Mr. Secord? 

A No , I don ' t . 

Q Did you at any time make a loan to General Secord 
through STTGI? 

A The question is not clear. To make loan through 
STTGI, to General Secord, to me it means that STTGI has 
funds and Secord wants to borrow money from it. He is the 
president of the company and I aun not exactly -- officer, 
running the company could have lent the money to himself. 

Q As I understood it, it was a 50-50 partnership, 
isn't that correct? 

A Yes. 

Q Generally, when a partnership lends money to an 



296 



wiASsra 



136 



individual partner, the other partner is aware of that, 
isn't that correct? 

A Normally, yes, but -- 

Q What I asked you was to your knowledge did your 
partnership lend money to General Secord? 

A Your question was different the first time. You said 
if I lent money to him, if the partnership. No. I am not 
aware of any such thing. 

Q I want to be clear on your testimony. You are not 
aware? 

A I am not aware of STTGl lending amy money to 
General Secord with my knowledge. 

Q I see. 

MR. ZANARDI: Can I help you out a little bit? 

MR. VAN CLEVE: Sure. 

EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 

BY MR. ZANARDI: 

Q Those monies, I believe, were disbursed through 
CSF to — through one of your accounts, through CSF in 
New York and went to STTGI. Did you — did the STTGI have a 
line of credit or any other type of loan with CSF? 

A Yes. 

Q The monies that are reflected in these transactions 
leaving the enterprise, were they part of that loan agreement 
with CSF? 



J 



UNCLASSIFIED 



297 



mussm 



137 



A Very possible, but it is not loan to Secord. Loan 
to STTGI. 

Q Right. Okay. 

A So -- that is why I am confused. 

MR. VAN CLEVE: I understand. What your testimony 
is, if I understand it, this was not a personal loan to 
Mr. Secord, it was a loan to STTGI? 

THE WITNESS: Exactly. We have an agreement. It 
may even be in writing. It may be in writing. I am not 
sure that CSF would extend a line of credit to STTGI and it is 
very possible that these are draws against that line of 
credit. 

BY MR. ZANARDI: 

Q Now, if the line of credit was extended to STTGI, 
would the repayments of that line of credit come from STTGI 
or would it come from the enterprise? 

A The intention was to come from STTGI, but it didn't 
work out to be like that. 

Q So STTGI then did not make any direct repayments of 
any of the line of credits? 

A We never got a chance to make enough money to do that 
and the project was aborted and I don't have firsthand knowledga 
myself about the bookkeeping of CSF. But if I were a thumb, 
I would just take the monies from the enterprise's money 
and settle the account, I don't know what they have done. 

IIIIAI inAirirr^ 



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WSMB 



138 



Q So, in practical purposes, there was really no 
loan if the payments went through the enterprise to STTGI , 
and if there is no outstanding balance, it is a payment from 
the enterprise to STTGI? 

A The way things stand today, your analysis is correct. 
Q Mr. Zanardi. Thank you. 

MR. JANIS: May we take a short break? 
MR. VAN CLEVE: Sure. 
(Recess . ) 

EXAMINATION ON BEHALF OF THE HOUSE .SELECT COMMITTEE 
BY MR. NIELDS: 
Q I think I am moving to page 11. We have covered 
everything down to the May 2 one. 

We already know what 8833 is, 20 May. I think that is one 
of those 30-30-30-10 splits. 

(Discussion off the record.) 

(Whereupon, the document referred to 
was marked for identification as 
Hakim Deposition Exhibit A.H.-4.) 
MR. NIELDS: We are marking as Exhibit 4 a 
document marked CSF Investment Limited ledger, and under that 
it says "Name and Description", and under that it says 
"SciTech Trading Group, Inc." 

MR. JANIS: May I have one? 
Thank you. M^^f^- A 



mm 



299 



yNtlASSIFIED 



139 



BY MR. NIELDS: 
Q I put in front of you, Mr. Hakim, a document 
marked Deposition Exhibit 4. It is a five-page document 
containing receipts and disbursements relating to 
SciTech Trading Group, Inc. I am putting that in front of you 
right now to permit you to refer to it to the extent you need 
to in order to answer the questions. 

That I will ask you from page 11 of Exhibit 3. 
My first question is there is on page 11 of Exhibit 3, a 
$100,000 disbursement to SciTech from Hyde Park Square 
dated May 22, 1986. What does that represent? 

A Do you know where that is reflected on Exhibit 4? 
Q Page 2. 

MR. JANIS: What is the date again? 

MR. NIELDS: Date is May 22. 

THE WITNESS: I found that. It is from Hyde Park — 

MR. NIELDS: Page 3 of Exhibit — 

MR. FLETCHER: Third page, labelled page two. 

THE WITNESS: Where it says — I found that. Okay. 
Yes. It says from Hyde Park. Okay. 

Looking at these both documents, I really cannot 
help you. However, I testified earlier that there should be 
an additional $100,000 in connection with a timber deal. 
If the dates should jibe — if the dates should concur, that 
could be it. So what I suggest we do at this time, if we 



300 



\mivm 



140 



could go back and pursue that transaction. 

BY MR. NIELDS: 
Q This is $100,000 that was taken from the 
enterprise and put into SciTech for the benefit of you and 
Mr. Secord? 

A To be sent to our attorney in Seattle for the 
earnest money for the timber deal, if the dates would fall in 
the same time period. 

MR. JANIS: Mr. Nields, I think the problem I have 
with this page, which I think is different than the other 
pages of Exhibit 3, in essence, this page is — the deposits 
that went into SciTech. What you are interested in is not 
so much the deposits, but the payments. 

This other exhibit. Deposition Exhibit 4, is one that 
I think is more pertinent for that purpose. This is just 
the starting point. Deposition Exhibit 3, and I think if you 
really want to know what happened to the SciTech funds, then 
you have to go through each entry on Deposition Exhibit 4. 
I think that will take us forever. 

MR. LIMAN: But the money — let's just make it 
simple. The money that went into SciTech was the money 
going into an entity that was created for the benefit of him 
and General Secord, correct? 

THE WITNESS: That was the intention unless CSF 
has made misallocations. There is a lot of track record 



iiMN AQCinrn 



301 



BHOussro 



141 



that they have misallocated. I have no reason to believe 
this was misallocated, Mr. Liman. 

MR. LIMAN: But the question was created for the 
benefit of both of you? 

THE WITNESS: That is right. 

MR. LIMAN: Investments were made from that company 
for the benefit of both you and Mr. Secord? 

THE WITNESS: Secord. 

MR LIMAN: Those investments were found by Mr. 
Secord to this con man Marostica, and we could go through the 
ledger of SciTech to see how the money was disbursed, but 
it is being disbursed from an entity created for the 
benefit of both of you? 

THE WITNESS: That is right. 

MR. JANIS: I don't think he had any control over 
that. That is why I think the exercise Mr. Nields is undergoing 
here is not worthwhile. 

MR. WECHSLER: If that is the only point you have to 
make, let's move on. 

MR. JANIS: This just shows money going into 
SciTech, not what happened there. 

That is exactly the point. I agree with what 
Mr. Nields stage-whispered. 

MR. NIELDS: I will make it not a stagewhisper . 
This page 11 is different fxom every other page of Exhibit 3 



> different from every otl 

iiKini K^inf fi 



302 




142 



because it relates to the capital account and all the others 
relate to disbursements from the enterprise. But in any 
event, the money going into this SciTech account would be 
money going into the enterprise that was set up for your 
and Mr. Secord's benefit just as Mr. Liman said a moment ago? 

THE WITNESS: That is right. I qualified that. 
In essence, it is the same, but I would really like you 
again to say CSF has made a lot of misallocations. The concept 
doesn't change. 

SciTech was for the benefit of both General 
Secord and myself. The concept doesn't change. 
BY MR. NIELDS: 

Q I may be also going over ffi-n^in,^ you have already been 
over. I aun not certain. I would like to ask you questions 
about page 13. 

MR. VAN CLEVE: I was just describing to Mr. Nields 
the nature of the questioning. That was we dealt with the 
general nature of what was denominated incorrectly on the 
exhibit according to your testimony as a personal loan to 
Mr. Secord. 

BY MR. NIELDS: 

Q I take it rather than being a personal loan to 
Mr. Secord, these are, in effect, disbursements to STTGI which 
wds a joint enterprise between you and Mr. Secord? 

A Yes. It started out as a loan and then the loan 




303 



143 

was cashed in from the monies of the enterprise and 
effectively money was pumped from the enterprise into STTGI. 

MR. LIMAN: In other words, it is forgiven? The 
loan is forgiven? 

THE WITNESS: The loan was paid for by the 
enterprise. 

MR. NIELDS: To CSF. So the net effect is there is 
a transfer from the enterprise to STTGI? 

THE WITNESS: That is what I testified. 
MR. NIELDS: In th6 amounts indicated on page 13? 
THE WITNESS: But what I have reason to believe 
that STTGI 's books are kept reasonably well because a good firm 
is doing that. 

BY MR. NIELDS: 
Q The answer to my question is yes, I take it? 
A I cannot under oath refer to each one of these 
individual transfers and generalize, but in principle, the 
answer is yes. 

Q Okay. These entries are taken from your records 
rather than STTGI 's records? 

A You are saying my records, you mean CSF records? 
Q I mean CSF records and I mean — 

A And I have testified CSF records were not audited 
by me before. I am trying to be precise and factual as I can 
and yet cooperative. 



UNCLASSIHED 



304 



uHtussra 



144 



Q The remaining ones, I believe, come from the bank 
records? 

MR. ZANARDI: Here? They all have been the bank 
records. 

MR. NIELDS: They were not from CSF records? 

MR. ZANARDI: They were all from CSF records. 
If you want documentation from the bank, I have it here. 
Some of it. 

MR FLETCHER: These are recorded in the ledger, 
John, if that is your question. 

MR. JANIS: May I add something? I don't want to 
waste a lot of time, but do any of these starting with I 
suppose the May 5th, 1986 and thereafter, did any of these 
transactions reflected here in the records that we provided 
have back-up for what they were? 

In other words, as I recall the records that were 
provided in a number of instances, CSF provided -- and we have 
provided to you documentation for what some of these expenses 
were. 

Is it your — none of that is present? 

MR. ZANARDI: There are records that support some of 
those transactions that you gave us. 

MR. JANIS: Those records don't indicate what the 
particular transaction is for? 

MR. ZANARDI: It says — let's show you one of the 



305 



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145 



records. 



MR. JANIS: We can be off the record. 
(Discussion off the record.) 
MR. NIELDS: Let's go back. 
BY MR. NIELDS: 
Q Mr. Hakim, off the record we have been talki.ig about 
page 13 of Exhibit 3 and I take it that you do not now have 



specific rec^lection of the reason for each one of the transfers 
indicated on this page? 

A You ire right, sir. 

Q And I take it that you have a general recollection 
that from time to time there were infusions of capital from *-he 
enterprise into STTGI? 

A In the context that we earlier established, yes. 
Q And you think that it is possible that some of the 
amounts listed here that are not in round numbers were 
transferred for a particular purpose? 

A That is a logical conclusion we could come to. 
MR. NIELDS: Let's go off the record. 
(Discussion off the record.) 
MR. NIELDS: Let's go back on the record. 
I would like to go back on the record. Wait a minute. 
We are back on the record. 
BY MR. NIELDS: 
Q Mr. Hakim, directing your attention to the back of 



306 



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 



«VXS»B 



146 



p'ige 14, and I am going to ask you please to identify the 
purpose for each business expense listed here that you can 
recall, 

A The figure that is referred to as business expense 
on 15 May 1986, from Albon Values for the amount of $30,150, 
if the dates should correspond to the time that we started^B 



Q They do. 

A — -hen this is the money that was cashed and the 
$150 was probably the expense of cashing it and was brought 
by CSF to my place of residence then in Geneva and I don't know 
where you got the annotation ^^^^^| but I believe if I am not 
mistaken that is the name of the DEA gentleman ^^^^^| who 
came to my place of residence and collected the $30,000 in 
cash. But — 

Q Any others? 

A One has to look at the dates to make sure I em right. 
I do happen to have a note here that — the last name 
gentlemem ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ ^^ 
lives |^^|H||||^^<^ also see a notation^^^^^H He 
the operational many who went^^^^^^^^^ I talked to him a 
number of times,^^^^^^^Band I believe his last name is 



So if these dates correspond, that is where that 



expense went to. 



\\m AWIFIFP 



307 



wmsffl 



147 



August 20, 1986, business expense, Tom Clines. 
This must have had -- recalling the earlier discussions and 
earlier testimonies in connection with the abandoned or 
rather stranded weapons, I see that is also in August 1986, 
that probably reprpsents the expenses that Mr. Clines incurred 
in connection with that activity. 

That is a guess on my part. Again, that date, 
22 August 1986, business expense, RVS , Richard V. Secord, 
$7,000. That date corresponds to the time that we were 
actively examining the individuals of the second channel. 
So that must be allocated to the Iranian initiative, just 
judging from the dates. 

I cannot identify anything else there. I don't know 
this 24 September 1986 business expenses to Tom Clines for 
5,000. I cannot recall Mr. Clines' involvement at that period 
of time, because to the best of my recollection, that was the 
active part — that could very well have to do something with 
the Iranian initiative you were — you might have had a — he 
might have had an assignment to do some work in connection 
with the Iraniam initiative. 

MR. JANIS: Off the record for a second. 

(Discussion off the record.) 

MR. JANIS: Let's go back on the record. 

THE WITNESS: Based on comparing the dates that this 



IINP.I mm 



308 



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 



wussro 



148 



24 September 1986 refers to the date that the stranded weapons 
were transacted. In my mind, I would allocate that to the 
contra account. 

MR. WECHSLER: By that you mean the 5,000? 

THE WITNESS: The 5,000, yes. 

BY MR. NIELDS: 
Q How about the next item down, 51,000, Hakim? 
A 51,000, Hakim? 

Do 1- have a back-up record to show whether this is 
cash or — to ne — if it is to me, I am the logical person to 
be able to explain that. If I had the back-up, that might 
help. 

MR. JANIS: Is there additional documentation? 

MR. ZANARDI: There may be. That is all I have. 

THE WITNESS: The only thing I see here. Trade 
Development. I have three documents here — I have three 
$51,000 payments, and I have three back-up documents. I am 
trying to sort them out. 

I see on two of them it says Trade Development Bank. 
Is this Dubai here? 

No. 

As I have testified in the past, anything that I 
know that has to do with Trade Development Bank is in 
connection with the American Express cards. I don't know how 

you reached the conclusion that I should be debited with these 
■ ■«IAI 



309 



wm«B 



149-165 



two payments, both of them $51,003.03. I don't see anything 
on this back-up document that would give me the idea that I 
should be debited with that. I cannot put that together. 

MR. HAKIM: Were people writing blank traveler's 
checks for you? 

THE WITNESS: No. 

MR. LIMAN: Who is Kuen, k-u-e-n, Sik, s-i-k, 
Won, w-o-n? 

THE WITNESS: A friend of mine. 

MR. LIMAN: In New York? 

THE WITNESS: In New York. 

MR. LIMAN: Off the record. 

(Discussion off the record.) 




310 



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166 



1 MR. NIELDS: Back on the record. 

2 BY MR. NIELDS: 

3 Q Mr. Hakim, I don't remember if there is a 

4 question pending, but if there is, I'm going to replace 

5 it with the following question. To the best of your 

6 recollection, what do the business expenses in the amount 

7 of $51,000 on the 30th of September, 1986, and 27th of 

8 October, 1986 represent? 

9 A You are referring to those that have my netme 

10 next to the business expense? 

11 Q Exactly. 

12 A It is speculation on my part. I believe these 

13 were cash moneys that I made available for the purposes 

14 of the contras in trying to finish and complete our 

15 obligations. This is speculation on my part. 

16 Q But I take it you do remember making some cash 

17 available to the contras at about that time. 

18 A Providing the cash for the use of the contras. 

19 I had no direct contact with — 

20 Q Physically how did you get the cash transmitted 

21 to the contras? 

22 A I made it available to General Secord and from 

23 there on he was in charge. 

24 Q Where did you make it available to him? 

25 A I remember a case that I transported it myself. 



311 



KUSSlFe 



167 



1 and — 

2 Q From Geneva to — 

3 A No, from New York. On maybe two occasions I 

4 did that. 

5 Q From New York to Virginia? 

6 A Yes. It's possible I had a third one delivered 

7 through a messenger. I can't recall now. Again, from 

8 New York. 

9 MR. LIMAN: Did he tell you what he was going 

10 to use the money for? 

11 THE WITNESS: The exact use of it, I don't 

12 know, but I knew that in many cases it was sent or -- 

13 Rafael Qimtero picked it up, or it was sent to him, and 

14 he took it actually inside and paid for whatever. 

15 BY MR. NIELDS: 

16 Q And were the eunounts consistent with these 

17 cunounts, $1,000, $51,000 — 

18 A The $1,000 is probably the cost of doing 

19 business. The actual money probably was 50. Again, 

20 this is a speculation on my part. 

21 Q It's speculation these are the correct items, 

22 but I take it that you do recall on two or three occasions 

23 bringing cash from New York to Mr. Secord in Virginia 

24 in approximately amounts of $50,000? 

25 A Maximum of 50,000. 



UNCLASSIFIED 



312 



UNClASSra 



168 



1 Q Are there any other items on this list that 

2 you recognize? 

3 A I believe I recognize the 27 October 1986 

4 business expense, Dutton 40,000. That I believe corres- 

5 ponds to the time we were making the shipment of the 

6 TOWs through the second channel to Tehran. So Mr. Dutton 

7 was brought in to go to Tel Aviv to effectively replace 

8 Mr. Secord like he did in the previous missions. This 

9 time Mr . Dutton was in charge . So that money was made 

10 available to him in Geneva. 

11 Q Any others? 

12 A There is a 26 November 1986 business expense, 

13 Shea and Gardiner. I suppose this is legal fees in 

14 connection with the Florida case. 

15 MR. LIMAN: Who were they representing? 

16 THE WITNESS: A whole group of us: General 

17 Secord, myself. There were some 30 people called as 

18 defendants. I don't know how many people were in our 

19 group. That is again speculation on my part. 

20 MR. JANIS: Off the record. 

21 (Discussion off the record.) 

22 BY MR. NIELDS: 

23 Q I would like you to look at page 15. 

24 A Yes, sir. 

a 

25 Q There are two disbursements there to Forway 



iiimi AOoiririL 



313 



DEUSSW 



169 



1 Industries. What were those for? 

2 A Again, it is speculation on my part in 

3 connection with the 25 August 1986 for amount of $50,000. 

4 I remember that we should look at STC and/or STTGI books. 

5 I believe STTGI books in California, not in Washington 

6 or Vienna. 

7 If I'm not mistaken, this has to do, this was 

8 allocated to money invested into STTGI. But the purpose 

9 of this was to, I believe, in connection with the 
promotion and sales of the laser sites that I testified 
yesterday. 

That is again speculation on my part, but can 
be verified through checking back records of STTGI, in 

14 Campbell, California, Bank of America. 

15 Q Let me see if I understand. The STTGI ones 

16 again in California was owned by whom? 

17 A STTGI in California and STTGI in Vienna, the 
same corporation. It is a California corporation. 
Operationally it moves its place of activity to Vienna 
where it was convenient for Mr. Secord, and the activities 
of the company in California was really limited to 
remaining in existence and having an address so the 
company could remain in existence as a California firm, 
but this particular payment or a particular payment through 

\\m tmm 



314 



UNCUSSIHED 



170 



1 Forway to STTGI was made for the purpose of the marketing 

2 of the laser sites, because we intended for Forway to 

3 manufacture these. It was our design -- 

4 MR. LIMAN: What does "our" mean? 

5 THE WITNESS: It actually belongs to me and 

6 an associate of mine. This is a follow-up on this 

7 Techtronics Company I mentioned to you earlier that I was 

8 conned out of $800,000. One of the products that they 

9 dealt with was a laser site, and it has a long story. 

10 From there it went to Hydra and they went bankrupt, and 

11 finally I developed this next generation of laser site 

12 with the help of an associate of mine, and this is the 

13 product that right now we are in the process of selling 

u 

14 to the Korean government. So Forway was supposed to 

15 provide a manufacturing capability for us. 

16 BY MR. NIELDS: So these are, as I understand 

17 it, expenses in connection with a business enterprise 

18 of which you emd Mr. Secord shared 50/50? 

19 A In the line of the context that we have already 

20 established, I would classify it as money transferred 

21 from the enterprise to us in July. That would be more 

22 accurate. 

23 We have managed to establish a line of 

24 communication here between us that regardless of what 

25 the original intent of these transfers were to STTGI, 

II iiiiAi ■ AAiririf^ 



315 



22 

23 
24 
25 



yNfiUSsm 



171 



which was a line of credit, the way things stand today, 

2 because the projects were aborted and because I'm sure 

3 Mr. ZucKer has cashed in on these moneys, these effectively 

4 are transfers from the enterprise to STTGI . So it should 

5 be categorized as such. 

6 I haven't answered your question in connection 

7 with the second figure, $260,000, Forway, on page 15. 

8 Q I'm glad you raised that. I thought you were 

9 answering with respect to both disbursements. 
10 A No. I said 50. 

Q I think that's correct, now that you remind me 
of it. What is the $260,000 disbursement to Forway? 

A If I recollect exactly, Mr. Nields, I would 
classify this as misallocation. The reason I so firmly 
classify that as misallocation is because, if I'm right, 
and this refers from the date, I believe I'm right, 12 



17 November, this is a transaction that STTGI accepted to 

18 perform for Forway, and which has nothing to do with the 

19 contras, the Iranians, the laser sites, a normal conven- 

20 tional type of business that STTGI can render to clients 

21 such as Forway. 



Forway had, and they still have, a hi ghly 
classified contract with the U.S. Government 




316 



Dimsw 



172 




1 Certain very large government contract has 

U 

2 an agreement with Forway for that classified project. 

3 Forway solicited or helped in] 
4 

6 to identify those equipment and Forway was supposed to 

A 

7 open a letter of credit in favor of Stanford Technology 

8 Vienna so we could pay the suppliers. 

9 Apparently the government contract, U.S. 

U 

10 Government contractor that had to contract with Forway, 

u 

11 they were late in opening the letter of credit to Forway. 

a 

12 So Forway was not in the position to effect payment to us 

/\ 

13 and the goods were sitting there with the supplier. 

U I, 

14 Forway is a company that Mr. Zucner personally has an 

15 interest, emd I talked to Mr. ZucMer. I said, "You have 

16 to step in and make available to STTGI a letter of credit 

17 so we can fulfill our obligations to the suppliers." I 

18 learned later on that he used the funds of the enterprise, 

19 which it was a deal between Mr. ZucHer, Forway and STTGI, 

20 and the funds of the enterprise should not have gotten 

21 involved in any way or form. 

22 So apparently it was convenient, he used it, 

23 he opened a letter of credit to STTGI . The transaction 

24 was finalized, consummated and there must be somewhere 

25 in all the papers here that this money was returned back 



317 



HHtUSSW 



173 



1 to the enterprise. 

a 

2 Q By CSF or by Forway? 

3 A One of the two. 

4 MR. LIMAN: Are you saying that the $260,000 

5 went to STTGI? 

6 THE WITNESS: No, I'm saying that Mr. ZucKer 

7 opened the letter of credit using the enterprise's 

8 money. 

9 MR. NIELDS: To pay the supplier with? 

10 THE WITNESS: No. 

11 MR. JANIS: STTGI then paid the supplier. 

12 THE WITNESS: Used it to open a letter of 

13 credit. 

14 MR. LIMAN: No money goes out when you open a 

15 letter of credit. 

16 THE WITNESS: No money goes out. It's only 

17 bookkeeping. 

18 MR. NIELDS: In whose favor was it opened? 

19 THE WITNESS: STTGI. 

20 MR. LIMAN: So STTGI could buy the goods from 

21 the vendor. 

22 THE WITNESS: That's correct. Actually, this 

23 money never left Switzerland or wherever it was. It was 

24 blocked. Based on that, a letter of credit was established. 

25 It was collateral, if you will. 



iiNni Emm 



318 



10 



25 



uNtmssiFe 



174 



1 MR. LIMAN: But there was a disbursement of 

2 something. 

3 MR. ZANARDI: The question I have is, is the 
letter of credit still open? We don't find any return -- 

5 THE WITNEGo: That is the point I'm trying to 

^ make: No money, based on the information he provided me, 

^ actually left our bank. 

8 MR. ZANARDI: It was sitting there. 

^ THE WITNESS: It was simply a bookkeeping 

maneuver . 
Il BY MR. NIELDS: 

Q What you are saying is that $260,000 is part 

of the moneys remaining in their possession on your 

behalf as you testified in Paris. 



15 A That is what I'm trying to say. 



Q Just so I understand it, maybe others do, I 
1^ do not, was the transaction consummated in the sense 
1^ the supplier was paid? 
19 



A The supplier was paid, Forway received the 
moneys from the prime contractor and we collected our 
commission. 

MR. LIMAN: And you then had to draw down on 
23 the letter of credit. 
2* THE WITNESS: That is correct. 



iiNni i<;<jinFn 



319 



UHCUSSIRED 



175 



1 BY MR. NIELDS: 

2 Q v«?ho initially made the money available to the 

3 supplier? Was it STTGI's bank in the United States? 

^ A I believe — you should look at STTGI's book 

5 iA Vienna. That total is reflected there. 

6 Q What you are saying, either STTGI paid the 

7 supplier or its bank paid the supplier and then -- 

8 A Or the prime contractor by then made the money 

9 available to be paid the vendor. It was satisfied. 

10 Q In any event, STTGI didn't either spend or 

11 lose money on the transaction and neither did the 

12 enterprise? 

13 A Not only that. What you said is correct. 

1* Not only that, for the first time STTGI had an income. 

15 They have had moneys coming in for the services that we 

16 render, but this was a commission that we earned. 

17 MR. VAN CLEVE: Just so I have the nature of 

18 I the transaction itself clear, this is all purchasing 
19 

20 I THE WITNESS: Yes. For the United States 

21 Government . 

22 MR. VAN CLEVE: Off the record, 

23 (Discussion off the record.) 

24 BY MR. NIELDS: 
Q We now go to page 20 of 37. 



2S 



UNCIiSSIFIED 



320 



20 



UNW.SSIFIEO 



176 



1 MR. JANIS: For the record, on page 17, I'm 

2 advised that there is currently an invoice outstanding 

3 for Air Advisory. I'm guessing it's something like 

4 $50- or $60,000. 

5 MR. LIMAN: Do you have a copy of that? 

6 MR. JANIS: No. 

7 THE WITNESS: I don't. 

8 MR. JANIS: There is a copy in Switzerland. 

9 And that's very embarrassing, very, very embarrassing. 

10 MR. JANIS: That is a Swiss company. 

11 THE WITNESS: There is a way you have to do 

12 something with that. 
MR. LIMAN: If you testify here long enough, 

maybe witness fees will do it. Only 716 more transactions 
to go through. 

16 BY MR. NIELDS: 

17 Q Okay, page 2. If you don't know the answer to 

18 it, don't speculate about it. 

19 These are a series of payments to Tom Green. 
Do you know what they relate to, Iran, contra or other? 

21 A I believe, I'm not sure about one item here -- 

22 I don't like to speculate, but I believe that $50,000 was 

23 a loan that I provided effectively out of the enterprise 

24 to Richard Secord for Tom Green. Such a thing happened. 

25 I don't know whether this is it or not. 



!iNniii.<;.<;iripi 



321 







, MR. LIMAN: But there was a $50,000 item? 

2 THE WITNESS: Mr. Liman, a figure close to 

that. But it was 35 or 65 -- 

4 MR. LIMAN: There is one 4 5 and one 60. If 

5 you don't know which it is -- 
MR. ZANARDI : There is one transaction to 

•7 Tom Green that appears in the capital account. 

g MR. NIELDS: Exactly, that is the point. That 

9 is the $45,000 one. 

THE WITNESS: I didn't hear. 

MR. NIELDS: He says it appears on the capital 
account, on Secord's capital account, Korel, and if that 
was a — if in effect you were treating this as a 
Secord personal expense, it would make sense to allocate 
it to the Korel capital account, I take it. 

THE WITNESS: I don't think I was that efficient 
when I made that note — 

MR. LIMAN: What you know is that General 
Secord asked you to advance either $45- or $50,000 as a 
loan to his attorney. 

THE WITNESS: That's it. 

MR. LIMAN: Was there a note signed? 

23 THE WITNESS: Not with me. 

24 BY MR. LIMAN: 

25 Q Was the money to be repaid to General Secord? 

•'^101 nooinrn 



322 



UNCUSSIFIED 



178 



1 A To General Secord. 

2 Q So it was going to be a loan by General Secord 

3 to Tom Green, and you advanced the money or disbursed 

4 the money to General Secord? 

5 A For the purpose of your bookkeeping and 

6 allocation, I would charge this to Secord, for bookkeeping 

7 purposes. 

8 BY MR. NIELDS: 

g Q You said yes to a question that surprised me. 

10 Are you saying that this was a loan to Tom Green — 

11 MR. LIHAN: Yes. 

12 BY MR. NIELDS: 

13 Q Or a loan to Secord so he could pay Tom Green? 

14 A No. No. I consistently said it was a loan 

15 to Tom Green at the request of Mr. Secord. 

16 BY MR. LIMAN: 

17 Q It was a loan from Secord to Tom Green? 

18 A To Tom Green. 

19 Q You provided the money to Secord and it should 

20 have been charged therefore to Secord 's account? 

21 A That's right. 

22 BY MR. NIELDS: 

23 Q And I take it that could have been the 

24 $45,000 transaction or it could have been the $50,000 

25 one consistent with your memory? 



UNCI hmm 



323 



UHCUSSIflED 



179 



1 A It could also be possible that it's not even 

2 here. Okay. 

3 You show me these. It refreshes my memory. 

4 I remember the transaction — 

5 MR. LIMAN: And the rough amount. 

6 THE WITNESS: And the rough amount. 

7 BY MR. NIELDS: 

8 Q Do you remember the rough time period? 

9 A No. 

10 Q 1985 or 1986? 

11 A I honestly can't remember. I would say it was 

12 1986. 

13 BY MR. LIMAN: 

14 Q You answered there was a $35- or $50,000 loan 

15 that you have just described. What were the other pay- 

16 ments to Tom Green for? 

17 A The best guess that I can make is these must 

18 be legal fees. 

19 Q When you say "best guess," I take it all of 

20 these were payments at the direction of General Secord? 

21 A Definitely. 

22 Q And were these payments where he channeled 

23 the direction to you or where he went directly to 

24 Zucher? 

25 A Secord, unless it was absolutely necessary. 



324 




180 



Sn< 1 



1 tried not to come in contact with ZucKer's network. 

2 Q What was the reason that he tried not to come 

3 in contact with ZucHer? 

4 A It was a very basic understanding, Mr. Liman. 

5 Each one of us had his own circle — 

6 Q And function? 

7 A And function. We tried to remain in there as 

8 much as possible without getting in the way of the other 

9 party. 

10 Q Was it to maintain secrecy? 

11 A Very much so. 

12 Q You would deal directly with him? 

13 A Yes. 

14 Q You would deal directly with ZucKer? 

15 A There's no question the structure to maintain 

16 secrecy at all levels, as you probably know, for instance, 

17 I do not have U.S. clearance. I should not have been 

18 privy to a lot of information, so they wanted to honor 

19 that. And there were a lot of things, still a lot of 

20 things within my — I testified yesterday my business 

21 network that I had created from the time that I lived 

22 in Switzerland. I didn't want them to get into my 

23 system. So we respected and honored that. The same 

24 thing applied to all these structures. 



25 



\un h^mvti 



325 



yNCiASsra 



181 



1 BY MR. NIELDS: 

2 Q Are these disbursements to Tom Green in 

3 connection with the Florida lawsuit? 

^ A I don't believe so. It is possible. However, 

5 I am not certain Mr. Secord did consult Mr. Tom Green 

6 now and then in connection with the corporate entities. 

7 I don't know that for a fact. 

8 MR. JANIS: May I have your indulgence? 

9 THE WITNESS: There is a good observation here, 

10 Mr. Nields. 

11 MR. JANIS: Let's go back on the record. 

12 MR. NIELDS: Yes? 

13 THE WITNESS: It appears the possibility I 

14 mentioned earlier about this loan to Mr. Green may not 

15 appear in any of these. If you go back to the page that 

16 I effected payment to Mr. Janis for the contra-related 

17 lawsuit. That's the back of page 8. If you look at 

18 that date, 24 July 1986, payment to Mr. Janis' law firm 

19 for $10,000, 24 July, and if you come back to that 

20 $50,000 payment the 22 of July, that could very well be 

21 in connection with the contras . 

22 BY MR. LIMAN: 

23 Q To Mr. Green? 

24 A To Mr. Green. 



25 



"MniiwiRFn 



326 



wm^'^^ 



182 



1 BY MR. NIELDS: 

2 Q You mean in connection with the Florida lawsuit? 

3 A The Florida lawsuit and thus it could be a legal 

4 fee . 

5 Q How about the subsequent ones? 

6 A I testified earlier that I can only guess. 

7 I recall vaguely Mr. Secord now and then consulted with 

B Mr. Green on both of these covert activities. These could 

9 very well, all of these, be legal fees. 

10 Q Do you know if anyone else consulted with 

11 Mr. Green on the covert activities? 

12 A Consulted -- at the beginning of the operation 

13 or at any time? 

14 Q At any time. 

15 A I don't have firsthand information. I know that 

16 I consulted with him for a very short period of time 

17 before I retained the services of Mr. Janis' law firm. 

18 MR. VAN CLEVE: Were you a client of Mr. 

19 Green's in connection with the Florida lawsuit at any 

20 time? 

21 THE WITNESS: To this date I'm not quite sure 

22 how legally this falls out, because he retained another 

23 lawyer, and technically I don't know. He may very well 

24 be my attorney in this thing, I don't know. I have no 

25 legal opinion. 

iirai:i j^.,. 



327 



UNCIASSIFIEB 



183 



1 BY MR. NIELDS: 

2 Q So you consulted with him a very small amount, 

3 as I understand it, about North? 

4 A I believe there was a time that, when we were 

5 all panicking after the famous speech of Mr. Meese. He 

6 was -- 

7 Q I don't mean that. I mean earlier. 

8 A Earlier, I don't know. 

9 Q Was Mr. Green ever paid a finder's fee in 

10 connection with the Canadian arms? 

11 A I believe so. I did not pay him. I did not 

12 pay him. I don't believe Mr. Secord paid him. 

13 BY MR. LIMAN: 

14 Q You heard of the Canadian arms deal — 

15 A The reason I remember that it was paid to 

16 his law firm, it was not paid to him. 

17 Q Did he complain? 

18 A I don't know. 

19 Q When you say it was paid to his law firm, 

20 somebody must have told you what the Canadian arms dealer 

21 paid to a law firm a finder's fee? 

22 A I believe my information must have been through 

23 Mr. Secord. 

24 Q And Mr. Secord told you the Canadian arms 

25 dealer paid the law firm a finder's fee? 



328 



wmm 



184 



1 A The reasons outstanding in my mind is Mr. Secord 

2 must have told me that his law firm was paid for this and 

3 I found that very strange, how you pay a law firm's finder's 

4 fee -- you could pay a member of the law firm, but -- 

5 Q Did Secord tell you they made a "listake and 

6 it should have been paid to Tom himself? 

7 A No. 

8 Q Did he find it strange or just you? That's 

9 what I'm asking. 

10 A I found it strange . He said that it was the 

11 corporate, or the law office's activity, and they shared 

12 everything alike and he wanted to remain decent, and he 

13 did not find it adequate -- I'm saying, to me, it was 

14 strange, to Secord it was not strange, to Tom Green it was 

15 not strange. He thought it was ethical for him to share 

16 it with his partners. 

17 Q What do you mean when you say it was not 

18 adequate? 

19 A In my mind. 

20 Q You use the word it was not adequate. I just 

21 didn't understand that. 

22 A To me, a law firm — 

23 Q You thought it should have gone to the 

24 individual, not the institution. 

25 A That's not what I'm sayiiig. In my mind, a law 



329 



WLASSIFIFO 



185 



1 firm practices law; they don't go and find — then if it 

2 goes -- to me, it was quite strange because the money went 

3 to the law firm. And I see ethics -- I mean substantial 

4 high ethical move and then it's — I didn't see anything 

5 unethical with it. I f::und that to the contrary, it 

6 increased my respect for Mr. Green to be so open to his 

7 clients and not to go behind their back and do other 

8 things. 

9 EXAMINATION ON BEHALF OF THE HOUSE 

10 SELECT COMMITTEE 

11 BY MR. NIELDS: 

12 Q Let's move to page 23. That is a disbursement 

13 to Goulden's client. What is that? 

14 A Do you have any back-up document on that? 

15 MR. LIMAN: Who is Goulden? 

16 THE WITNESS: First time I hear it. 

17 MR. LIMAN: Do you know who it is? Why don't 

18 you tell him so he can tell us. 

19 MR. NIELDS: Back on the record. 

20 BY MR. NIELDS: 

21 Q What's your best information as to what Goulden's 

22 client is and what this represents? 

23 A The way I would like to answer your question, 

24 Mr. Nields, is maybe to give you a clue, with the rest of 

25 the information you have, and see if my speculation is 



330 



11 



UNCIASHD 



186 



4r correct. 

2 I believe that this has to do with the trans- 

3 action in connection with the Blowpipe from England, 
* a certain David Walker. My best guess is that this deals 

5 with that. So if you can look into it further — 

6 MR. LIMAN: Did you not get the money back? 
^ There was a deposit back. Did you not get that money 
8 back? 
^ THE WITNESS: I can't recall what happened to 

^^ that transaction. I don't know whether we even collected 

this. 
■•2 Correction. Correction. I believe it was 

13 Dave Walker. I believe the transaction was not the 

Blowpipe. I believe the transaction had to do with the 

load master to pilots. 

16 BY MR. NIELDS: 

17 Q And the phrase "Goulden's client" is on your 
record, I take it, as a way of preserving the secrecy 
of Walker's identity? 

20 A I suppose so. I cannot be sure. I suppose so. 

21 Q You are talking about the crew for flying the 

22 airplanes into Nicaragua and dropping the weapons to the 

23 contras? 

24 A There was a time, yes. Yes. 
Q I suspect — well, I don't know. Is this a 



25 



1 



5 



24 



331 



llNtlASSro 



187 



misprint? This is a Motorola transaction? 

2 MR. JANIS: For the record, in your record it 

3 said Matada. 

4 BY MR. NIELDS: 
Q Turn to page 24. I don't need to ask any 

g questions about that. Try 25. Four disbursements to 
7 Stanford Technology. 
3 A I have only one basic question in connection 
9 with the back-up documents on this. Was it transferred 
to California? 

MR. NIELDS: That's what I want to find out. 
^2 THE WITNESS: It seems we are talking about 

13 transfers to California, and while you gentlemen are 

looking for back-up documents, there is a point I would 
15 like to bring to your attention. 

15 I recall a transfer that was supposed to be 

17 made to STTGI 2md by mistake it was transferred to 



Stanford Technology Corporation in California and then 
STC found the mistake and retramsferred it from their 



20 account to STTGI. If you come across — 



MR. LIMAN: How much? 

THE WITNESS: It was a substantial sum. It 



23 was a large sum. 



BY MR. NIELDS: 



25 Q I don't know what you think of as large. 



332 



uNcussro 



188 



1 A Maybe $50-, $60-, $70,000. So if you come 

2 across that transaction, you should consult STTGI or 

3 STC's books to obtain clarification. 

4 MR. NIELDS: Has anyone come up with any 

5 back-up for theae? 

6 The question is whether these are transfers to 

7 Stanford Technology Corporation or transfers to STTGI. 

8 THE WITNESS: If you show me where they were 

9 transferred — let me answer your question differently. 

10 There were transfers made to Stanford Tech- 

11 nology Corporation. I should have been indebted for 

12 that, not the enterprise. 

13 BY MR. NIELDS: 

14 Q I believe if these are transfers to Stanford 

15 Technology, I think you say they are for your personal 

16 benefit and not for the enterprise. 

17 A Or STTGI . It should be the individual Albert 

18 Hakim. 

19 Q Would you turn to page 30? 

20 MR. JANIS: This gets into a very sensitive 

21 area. 

22 MR. NIELDS: We are talking about names of 

23 people that ought not be named? 

24 MR. JANIS: Yes. 

25 MR. NIELDS: Tell us if — 

IIIIAI AOOinrr^ 



333 



wussra 



189 



1 THE WITNESS: I can give you the nature of it 

2 and then -- 

3 MR. LIMAN: Why don't we do sensitive matters, 

4 I think John is entitled to it, George it entitled to 

5 it, and I'll take it on the same confidential basis. We 

6 just can't operate without having some understanding of 

7 it so we can tell our members they shouldn't go into it. 

8 MR. JANIS: We are prepared to do it generically. 

9 MR. NIELDS: If we need more off the record, 

10 we'll go off the record. 

11 MR. LIMAN: We're going to have to give 

12 instructions to members. 

13 THE WITNESS: I want to help as much as I can 

14 so you can do your job and we can get on with our lives. 

15 Life must go on. So if we can get off the record. 

16 MR. JANIS: Is there anything you can say on 

17 the record about this? 

18 THE WITNESS: Yes. This has to do with the 

19 second channel in connection with Iran. 

20 MR. NIELDS: Okay. 

21 THE WITNESS: We're off the record? 

22 MR. LIMAN: We're going to stay on. 

23 BY MR. NIELDS: 

24 Q On page 3 3 you have five directors fees. I 
take it these are fees paid to CSF? 



25 



334 

mmm 

1 A For the directors. They must have paid also 

2 the Panamanian reports — 

3 MR. LIMAN: These are the dummy directives. 

4 THE WITNESS: I don't think they would like that 

5 terminology. 

6 MR. LIMAN: I don't mean dumb. There is a 

7 difference. There were times when people appreciated 

8 being called that. 

g MR. VAN CLEVE: These are rather expensive 

10 dummy directors. 

11 BY MR. NIELDS: 

12 Q Page 34. Let's keep going. There is a 

13 disbursement from Udall tol 

14 MR. ZANARDI: I believe that's also Quintero. 

15 MR. NIELDS: Does Mr. Hakim know anything 

16 about this? 

17 THE WITNESS: If I know what this is, there 

18 is a misspelling there. And, again, we discussed that 

19 separately — 

20 MR. LIMAN: Why do you think it's Quintero? 

21 MR. ZANARDI: Let him answer the question. 

22 BY MR. NIELDS: 

23 Q Can you tell us whether this is — tell us 

24 the correct spelling. 

25 A Let me limit the answer to the question that 



335 



10 



12 



19 



UNClASSinED 



191 



' has to do with the -- 

2 Q Is this an expense for Iran or contra? 

3 A Iran, second channel. 

* MR. ZANARDI: It is the same person as the 

5 other one, I'm sorry. Mike Farina. 

6 BY MR. NIELDS: 

7 Q On page 35, an expense from Energy Resources, 

8 April -- that should have been charged to you? 

9 A That's money I transferred for my wife. She 
happened to be in Korea then. 



11 Q Let me tell you that we made the mistake, not 



CSF, and it was charged to you. 



13 A Okay. Good. 

I* Q Page 36. There are three charges, Eric 

IS ZucHer, cash. There is a misspelling there, too, but 

■•6 these are all to Mr. ZucKer's son, I take it. For what 

''7 purpose? 

18 A Do you have any records showing how he was 
getting paid for his salary when he worked for us for 

20 a short period of time? 

21 Q I don't think we do. 

22 MR. LIMAN: No, but these look like they're 

23 monthly payments . 
2* THE WITNESS: If they are monthly payments. 



336 



uNCussra 



192 - 200 



end 6 



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 



BY MR. NIELDS: 
Q So that's allocatable, equally, to all aspects 
of the enterprise? 

A I would say that this started with the 
Iranian initiative. It should be allocated to the 
Iranian initiative. 

Q You said he did up a chart which included both 
Central America and Iran? 

A He just used the machine and — 
Q Last page, 37, there are payments to Sharf, 
Green and Langford. These are apparently to the law firm, 
but I take it they are — 

A There should be invoices for that. 

MR. LIMAN: It looks like disbursements to 
me. 

THE WITNESS: I believe they were billed and 
had to do with the contras, and there should be 
invoices for that. 

MR. WECHSLER: You mean the Florida lawsuit? 
THE WITNESS: No, the contras. It had to do 
with a land purchase. 

MR. JANIS: Lanker is spelled with a "k" and 
not a "g." 



337 



DINKEL/#7 
bp-1 



UNUASSra 



201 



1 BY MR. NIELDS: 

2 Let's get into Iran, the Iranian aspect of this 

3 thing. 

4 A You don't want to cover this CSF thing, get 

5 that out of the way? 

6 Q Do you want to do that? 

7 MR. LIMAN: Are you in the mood to do CSF? 

8 THE WITNESS: I would like to finish with the 

9 borrowing stuff, figures, money, all of that. I winked. 

10 MR. NIELDS: Make sure you get that on the record. 

11 THE WITNESS: I have to design a new machine to do 

12 that. 

13 BY MR. NIELDS: 

14 Q What is it basically that you are focusing on? 

15 MR. JANIS: It is his job to ask the questions 

16 and your job to answer them. 

17 MR. NIELDS: It is easier to ask me. 

18 THE WITNESS: I eun trying to assist, to see where 

19 they want to focus. 

20 BY MR. NIELDS: 

21 Q Maybe you could begin by simply describing CSF 

22 to us. 

23 A CSF is a company that basically provides a various 

24 number of services, a service company. It provides fiduciary 

25 functions, money management, legal work, but basically thev 



338 



uNWssro 



202 



1 work with only a selected group of clients, where they are 

2 very selective. 

3 MR. LIMAN: Is there anything analogous to that 

4 in the United States, to that kind of company? 

5 THE WITNESS: Not under one roof. 

6 BY MR. NIELDS: 

7 Q Because they have both lawyers and investment 

8 counselors and -- 

9 A Yes. It is probably under two or three 

10 different kinds of professions you can come up with the 

11 same package. 

12 Q Tell us what the two or three professions are. 

13 A Banking, a law firm, and I differentiate between 
1* banking and money management. Money management — and there 

15 are other services that I classify under general. They do 

16 tax — they do quite a bit of tax work. 

17 Q Where are their offices? 

18 A It is in Geneva. 

19 Q Do they have only one set of offices? 

20 A CSF does only one set and then they added a new 

21 capability a few years ago and they created the CSF 

22 Investment Limited. I believe they are — legally it is 

23 formed under the laws of Bermuda, and they are located there. 

24 Q Located in Bermuda? 
A Yes. 



25 



IIMOI AQQlHFn 



339 



wmsw 



203 



1 Q Hamilton? 

2 A Hamilton. 

3 Q How many employees or partners — how many people 

4 are there that work at the CSF offices in Geneva? 

5 A A wild guess, I would say about between 12 to 

6 20 people. 

7 Q Can you just describe the different categories 

8 of people that work there? 

9 A They — first of all, they employ more than one 

10 system of computer. I believe they have two, two different 

11 sets of computers. They lease out some of that, some time 

12 of the computers. They do — I believe they do outside 

13 bookkeeping or at — leasing the computers for outside 

14 bookkeeping, so they have people who deal with the computers. 

15 They have accountants. They have tax experts. 

16 They have lawyers, and the rest is clerical and bookkeepers, 

17 general administration and so on. 

18 Q Who owns it? 

19 A I have — I do not have first hand information 

20 myself. 

21 MR. LIMAN: Who acts as if he owns it? 

22 THE WITNESS: Mr. Zucker. 

23 MR. VAN CLEVE: Do you own an interest in CSF? 

24 THE WITNESS: No, I don't. I have for — sometimes 

25 I entertained the idea of buying into that company and i 



340 



iwssifia 



204 



1 discussed this with Mr. Zucker. He thinks I am too dangerous 

2 for that type of business. I am a marketeer. 

3 BY MR. NIELDS: 

4 Q Does he have any partners who are perhaps less 

5 equal than he, but who are nonetheless partners in his 

6 business? 

7 A I don't believe so. I think it is a family 

8 organization. 

9 Q To 'the best of your knowledge he is the sole 

10 owner? 

11 A To the best of ray knowledge he is the sole owner. 

12 Q How many -- just approximately, if you have any 

13 idea, how many clients does CSF have? 

14 A I think he puts out some sort of a statement that 

15 doesn't spell out the number of clients he has, but he puts 

16 out what its assets are and how much money total they 

17 bank. 

18 Q How much total does he manage? 

19 A The last time that I talked to him about this 

20 must have been a couple of years ago. I think he was 

21 managing something in excess of 120, 130 million Swiss 

22 francs or the equivalent. 

23 Q One hundred thirty million Swiss francs. What 

24 is that in dollars? 

25 A You are talking something between 50 to 70 millioi 



341 



wmm 



205 



1 dollars depending when you take that. I must add at this 

2 time it is important that we all get a feel for what is 

3 happening to Mr. Zucker today. 

4 He is a very honorable man. He really is. He is 

5 a good friend. He is a good lawyer. He is a — in my 

6 opinion, he is the most creative financial man that I have 

7 seen. I have a lot of respect. He is a very dear friend 

8 of mine, and he has drastically, drastically suffered 

9 from this incident. 

10 He has lost a large number of his clients, and 

11 they simply came and pulled out their investments and 

12 employees resigned. He went through a very bad emotional 

13 time. He is still going through a bad emotional time. 

14 He is torn into p joacC B. He likes to maintain his pro- 

15 fessional integrity, his friendship. It is;not an easy 

16 situation that he is dealing with. 

17 Believe it or not, when he — at the beginning 

18 he did not know what we were doing. If there was a time 

19 that he came about to understand that we were working on 

20 some sort of a covert activity, I assured him that it was 

21 legal, and the President of the United States knew. He 

22 open-heartedly accepted to help us. He has definite, 

23 definite principle to fight Communism. The way I put it to 

24 him, basically -- this is what we were doing. So 

25 towards the end of our activities, he knew that we were 



342 



DNtUSSW 



206 



1 working on behest of the U.S. Government. He had no reason 

2 to doubt me. I have known him and worked with him for 

3 something like more than 15, 16 years. There is a lot of 

4 mutual respect and trust there. So I thought — I mention 

5 that on the record, that this man has suffered drastically. 

6 Q When you — 

7 MR. LIMAN: Did you consider yourself one of 

8 his more important clients? 

9 THE WITNESS: No. Not really. 

10 MR. LIMAN: In terms of magnitude of your 

11 business with him? 

12 THE WITNESS: I honestly, truly don't believe that 

13 he — even if you look at the amount of money that he 

14 has collected as a result of our activities, when you look 

15 at the total inefficiency that we created in his 

16 organization, we were not that profitable for him. 

17 Did I answer your question? 

18 BY MR, NIELDS: 

19 Q Let me follow it up a little bit. That is 

20 something I am not sure I understand. The money that you had 

21 on deposit at the various bank accounts, Hyde Park Square, 

22 Gulf Marketing, those monies would not be included in the 

23 amounts that Zucker managed, would they? 

24 A I don't think he would have shown that in his 

25 statement, no. 



;i A.i^^iFiP 



343 



15 

16 

17| 

18 

19 

20 

21 

22 

23 

24 

25 




207 



1 Q Now I take it that what would be included in 

2 the amounts that he managed are the amounts in the capital 

3 accounts that were sent to CSF and had comejout of the 

4 enterprise bank accounts? 

5 A With the exception that there were times that 

6 I have noticed, after looking at the figures, that he 

7 dipped into those accounts and used it in some instances for 

8 operational purposes when he was not supposed to. 

9 Q When you said those accounts, you mean the 

10 capital accounts had been used for operational purposes? 

,, A Basically what I am referring to, I am considering 

12 also the reserve as one of the capital accounts. So that 

13 is where the major money is parked. 



14 Q 



That money in the reserve, I take it, was managed 



by CSF? 

A CSF Investment. CSM Investment Limited. 

Q You testified in Paris about, I think, about 
a $6 1/2 million amount of money that was being held on your 
behalf by a Swiss fiduciary. I take it that was CSF? 

A Yes. 

Q Where is that money now? 

MR. JANIS: It is in the State Department -- that 

is off the record. 

THE WITNESS: We have been informed that these 
monies are kept in Toronto Dominion Securities-London. 

MAfiAi ftArtirirrv 



344 



UNCUSSIFIED 



208 /209 



1 BY MR. NIELDS: 

2 Q I would like you to say that again. Please do it 

3 again. 

4 MR. JANIS: I think what he said is Toronto 

5 DCiiiinion Securities in London. 

6 MR. VAN CLEVE: Is that a bank? 

7 MR. JANIS: That is my understanding. 

8 MR. ZANARDI: Can we go off the record for 

9 a second? 

10 (Discussion held off the record.) 

11 MR. NIELDS: On the record. 

12 MR. JANIS: Can we go off? 

13 (Discussion held off the record.) 

14 BY MR. NIELDS: 

15 Q Apparently there is reason to believe that in the 

16 very end of 1986, about $6.4 million was transferred from 

F 

17 Republic National Bank, a CSf account in Republic National 

18 Bank to Toronto Dominion Securities in London. The 

19 question you were asked while we were eff the record is whether 

20 that was at your direction. 

21 I take it the answer is no. 

22 A The answer is no. 

23 Q Then I would like to give you an opportunity to 

24 at this time give us more information about_CSF and how it is 

25 structured. 



UNClASSlFlEn 



345 



wsjs&m 



210 



1 A CSF is a self-sustained, complete service conpany 

2 with a lot of professional integrity and knowledge and 

3 creativity. They do not necessarily keep on calling their 

4 clients for every move that they want to make. That is 

5 very important to understand. And I am not just referring 

6 to us. I have seen Bill operating that way. 

7 He consults with these clients when necessary, but 
6 he knows where he is going. He knows what needs to be done. 

9 He spends a lot of time examining issues. He, like I said, 

10 provides a complete service under his own direction and 

11 management with the aid of the accountants and lawyers and 

12 other staff that he has. It is not a clerical organization. 

13 riR. LIMAN: So he has discretion? 

14 THE WITNESS: He has discretion. He makes 

15 decisions himself. That is to the benefit of his clients, 

16 how to protect the interest of his clients. He is very 

17 sensitive to that. 

18 MR. LIMAN: You are not suggesting that it is just 

19 coincidental that on December 30, 1986, transferred this 

20 $6.2 million from outside the United rStates jurisdiction 

21 to the UK? 

22 THE WITNESS: I am suggesting that it may not even 

23 have anything to do with us. It could very well be some of 

24 his clients — let me back up and tell you normally how he 

25 spreads his- I jf JP| ft CCICirH 



346 



i«sro 



211 



1 MR. LIMAN: Didn't you understand he was trying 

2 to protect one of his clients; namely, you tnsy moving the 

3 money outside of the United States jurisdiction? 

4 THE WITNESS: If we assume this money was ours and 

5 was kept in National Republic Bank, and it was ours, then 

6 your assumption is correct. 

7 EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 

8 BY MR. LIMAN: 

9 Q Did you not know where the money was before you 

10 heard it was in London at the Toronto Dominion Securities? 

11 A That is what I am trying to explain. The way — 

12 and one of the reasons that digging into this bookkeeping is 

13 so much more difficult than a normal way, he tries to 

14 spread the risk of his clients. 

15 What he does, let's say that there is an invest- 

16 ment of some — whether it is an office building or oil 

17 business or whatever, of $10 million. He syndicates that. 

18 Be goes and gets through — gets other firms, maybe 5 

19 million, and then he has 10 clients. He — depending on the 

20 amount of monies that they have with him, he allocates 

21 portions of their capital and then he goes as CSF Investment 

22 for the other $5 million 

23 MR. JANIS: Can we go off the record for a 

24 second? 

25 MR. LIMAN: Before that, CSF maintains an 



347 



mmsm 



212 



1 Omnibus account; is that correct, an account in which the 

2 monies of a number of clients are comingled? 

3 THE WITNESS: That is correct. 

4 MR. LIMAN: And on his books he can identify which 

5 clients money is where and — 

6 THE WITNESS: Where and how. Exactly. That is 

7 the point. That is the heart of the explanation. 

8 BY MR. LIMAN: 

9 Q That is his operation? 

10 A Exactly. 

11 EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 

12 BY MR. NIELDS: 

13 Q I take it he has a number of bank accounts in 

14 which his clients' money is physically located? There are 

15 more than one? 

16 A Obviously. 

17 Q I take it there is — well, how many are you 

18 aware of? 

19 A He is very discrete, believe you me. 

20 Q But you have heard of Toronto Dominion Securities. 

21 I take it that is a CSF account at Toronto Dominion Securities 

22 that your money is in? 

23 A I have no idea of how he has structured it. In 

24 answer to the question of our lawyers in Switzerland, this 

25 information was provided. 



IINHi Af^f^inrn 



348 



ywiiiASsm 



213 



1 Q Is it invested there? Is it earning money? 

2 A I believe it is in some sort of a ttorrrrit 

3 Q What does that mean? 

4 Does that mean, yes, it is earning interest? 

5 A Yes. It is earning interest. 

6 MR. JANIS: I believe that the record that was 

7 provided — am I mistaken? I believe the records that were 

8 provided to the committees by Mr. Hakim indicated the 

9 location of a number of banks in which these assets were 

10 invested? 

11 MR. ZANARDI: The — 

12 MR. JANIS: And they were not primarily United 

13 States banks. 

14 MR. ZANARDI: The problem is if we are talking 

15 about, for example, the $2 million reserve, the records we 

16 received indicated that it was a cash disbursement and in 

17 many cases — in that case, the bank was not identified. 

18 MR. VAN CLEVE: You were not able to tell from 

19 the records? You were not able to identify a dozen or so 

20 banks, financial institutions? 

21 MR. ZANARDI: In terms of CSF, the answer is, 

22 yes, because I think the best example would be in the arms 

23 transfer to Defex, in which at least four or five different 

24 CSF accounts were used. 



25 



iihii:! li^jsin^^ 



349 



UNCLASSIFIED 



214 



1 MR. VAN CLEVE: I think there is more in the 

2 record than either — either we are not communicating or 

3 there is more in the records than you may have gathered at 

4 first glance. I think the premise of your question is 

5 really not correct. 

6 MR. LIMAN: Not correct in the sense that the 

7 money was abroad before December 30? 

8 MR. VAN CLEVE: Yes. I think to the extent your 

9 question seemed to imply that, for example — 

10 MR. LIMAN: It did imply. 

11 MR. JANIS: — $6 1/2 million in Republic 

12 National Bank — 

13 THE WITNESS: It was a coincidence. 

14 MR. NIELDS: It might not have been a coincidence, 

15 too. Republic parks its money various places. Some went to 

16 Bermuda. 

17 MR. JANIS: I think the records the committee has 

18 would demonstrate that this was not a situation in which this- 

19 these monies were on deposit at Republic National Bank 

20 in New York and were spirted out of there before the end 

21 of the year so that nobody could get to them. 

22 MR. LIMAN: I just want to suggest to you that 

23 when — there is no way that your client is not going to be 

24 asked by at least a half a dozen members of the committees 
that I can think of where this money is and when it was 



25 



350 



uNWSsro 



215 



1 transferred there. And if he is in a position to answer it, 

2 he ought to answer it. If he is not in a position to answer 

3 both of those questions now, he ought to get himself in a 

4 position to answer. 

5 THE WITNESS: Those questions are valid questions. 

6 But what I am trying to say that Bill did not take our money 

7 necessarily out of Republic National Bank. My best guess is 

8 that he took the monies of all of his clients there because 

9 Republic National Bank became a target. That is my 

10 stimulation. 

11 So it so happens that the 6.4 million is very close 

12 to the 6.5. I don't find this to be Bill's style. I am sayinc 

13 that that could have belonged to a hundred clients. 

14 MR. LIMAN: Why don't we move on. I think you 

15 ought to put yourself in a position to answer as soon as 

16 possible — 

17 MR. JANIS: He can't. 

18 MR. LIMAN: He can answer right now. Consult 

19 with your lawyer. 

20 MR. JANIS: Answer what? 

21 MR. LIMAN: When did the money go to the Toronto 

22 Dominion? 

23 MR. NIELDS: Where has it been since November? 

24 Or I take it since November. 

25 MR. VAN CLEVE: Mr. Hakim's money- 



351 



wussro 



216 



1 MR. NIELDS: Where is it — was the money that CSF 

2 was handling on your behalf, the residue, the residual from 

3 the Iranian transactions. Where has that money been since 

4 November? If it is moved, where has it moved from? 

5 MR. JANIS: I think the committee has — 

6 MR. LIMAN: The object isn't to play hide and seek. 

7 If you have clues and go ahead and let's see how smart 

8 you are. Can they find it? 

9 THE WITNESS: Mr. Nields, I believe personally 

10 I do not have first hand information, but I am using my 

11 best judgment to answer your question. I believe since 

12 November, it must have taken Bill Zucker a good amount 

13 of time to call all the different investments and 

14 separate — segregate them, package them, and bring them 

15 back under the — he could not have called all of the 

16 investments — part of the investments. 

17 He had to call all of the investments. If he 

18 made a $10 million call, the example I gave you, he had to 

19 call all of that back, and he had to reallocate, to 

20 restructure. Any of his investments that he had any of our 

21 monies in it, he had to call all those back and redo it. 

22 My guess is — my guess, I have not spoken with Bill. We 

23 have not discussed this. My guess is that if he started to 

24 do that, he could not have rearranged his structure and 

25 protected also his other clients in less than two months. _ ^. 



352 



UNCUSSIFIED 



217 



1 So I would say that from the time that he felt that 

2 there is a danger towards his clientele, not just us, he 

3 started to call in all those and start restructuring it and 

4 my guess is it would take him a good 60 days to call 

5 and reinvest it. 

6 So let's go on with this. 

7 BY MR. NIELDS: 

8 Q I do want to second what Mr. Liman has said. 

9 I think it is very much in everyone's interest, including 

10 yours, for you to be able to answer that question. 

11 A I am leading to that. You said since November. 

12 So I want you to know, that probably I would not be able to 

13 account for two months of that. Okay. When you say 

14 November, you are talking about November 20, 25, so if — 

15 let's say by the end of January, Mr. Zucker became 

16 able to combine the assets of the enterprise. 

17 MR. LIMAN: Mr. Hakim, I know a little about 

18 Swiss fiduciaries. If you had gone in to see Mr. Zucker 

19 on December 12 and said, "Where is my money invested," he 

20 could have told you? 

21 THE WITNESS: Oh, yes. We are coming to that. 

22 MR. LIMAN: Therefore, I presume that you will be 

23 able to tell us and the committees, more importantly, where 

24 this money was during the period that Mr. Nields asked you. 
'^^ i THE WITNESS: Mr. Nields asked me — I understood 



25 



353 



KUSSW 



218 



1 the question to say after November. 

2 MR. LIMAN: Authority. 

3 THE WITNESS: Okay. I am saying that we can tell 

4 you where he had them until November. 

5 MR. LIMAN: Okay. That is right. And then — 

6 THE WITNESS: Then he started to go through the 

7 phase of transferring it. I am saying -- if I understand ray 

8 attorney, he says we have documents here that show where the 

9 monies were when you started to look into them. 

10 MR. JANIS. I am not testifying. 

11 MR. LIMAN: You can't do it right now. 

12 MR. NIELDS: We will move on. 

13 B[Y MR. NIELDS: 

14 Q Are you saying you can answer the question now 

15 (fi«tere the monies were prior to November? 

16 A I believe we can do a reasonably good job of that. 

17 MR. LIMAN: You believe your attorney can do a 

18 reasonably good job? That is what I understand. 

19 BY MR. NIELDS: 

20 Q Is that what you are saying? You could not do 

21 that now? 

22 A No. 

23 Q Well, I think that would be a very good idea for 

24 you to put yourself in a position to be able to do that 

25 maybe by tomorrow afternoon. 



IINfll AWIFIFn 



354 



UNCLASSIFIED 



219 



1 MR. JANIS: We will see. We have to talk about 

2 it. I am not sure that I can give you the level you weint. 

3 I am still not sure I understand — apparently there is some 

4 discrepancy between what ve have derived from the record 

5 and what you have derived from the record. 

6 MR. VAN CLEVE: I think, if I understand what 

7 John and Arthur are saying, the committee is simply going 

8 to want to know the committee was in such and such a bank. 

9 If it was invested for a particular purpose, andyou know that 

10 purpose, then the commiteees would want to know that 

11 purpose also. 

12 MR. JANIS: Let's go off the record, John. 

13 MR. NIELDS: Okay. 

14 (Discussion held off the record.) 

15 BY MR. NIELDS: 

16 Q Okay. Did you have an account at CSF prior to the 

17 time that the Energy Resources . account was set up and the 

18 Nicaraguan project began? 

19 A I believe I already testified that — 

20 Q You pulled everything out? 

21 A — during the time I lived and operated in 

22 Europe, I had bank accounts, company, hcMne, and also testified 

23 that when I relocated myself into the United States, the 

24 bank account was left there, but it was not substantial. 



I 



25 It was effectively dormant, but a small sum of money, which 



i 



355 



UNCUSHD 



220 



1 I spoke about yesterday. 

2 Q Was that an account with CSF? 

3 A No. 1 believe it was UBS. 

4 Q So your relationship with CSF had -- was 

5 dormant? 

6 A Except they were doing my taix and they — except 

7 they were helping me to make the transfer from the — 

8 from Geneva to Switzerland, helped me go through the 

9 transition period. 

10 Q Does anybody else have any questions generally 

11 about CSF? 

12 EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 

13 BY MR. SABA: 

14 Q Were you the beneficial owner during the period 

15 1975 to 1983 of any accounts or companies being operated 

16 by CSF or Mr. Zucker? 

17 A '75 to — 

18 Q Eighty- three. The time when you began the business 

19 with STTGI with General Secord. 

20 A Oh, prior to beginning of business with General 

21 Secord? 

22 Q Yes. 

23 A Seventy-five to '79 I definitely had active 

24 companies. 

25 I Q These were Swiss Companies? 



356 



MUSSIFIEO 



221 



1 A Swiss, Panamanian. 

2 Q Did -- 

3 A I testified yesterday. 

4 Q Did these companies have accounts operated by 

5 Mr. Zucker? 

6 A Not really. We did that ourselves — secretaries, 

7 accountants, so forth. He was our lawyer. Basically he 

8 handled our legal work. 

9 Q Did he operate any of the accounts for you 

10 during that period? 

11 A Not that I remember. 

12 Q Did — 

13 A To complete the answer to the question that you 

14 asked, from 1979 to 1983, I went through the phase of 

15 shutting down what I had in Switzerland so I cannot be 

16 precise as to the status, the legal status of the companies 

17 and accounts that I had there, but we were going through the 

18 process of phasing them out. 

19 There was no substantial sums of money kept there, 

20 if this is what you are looking for. 

21 Q Did some of the companies that we are concerned 

22 with here that we discussed yesterday, did they have other 

23 names prior to assuming the names that we know them now, sir? 

24 A No. Are you asking if — what we used for these 

25 two initiatives was something that I had from then and 



357 



UNeUSSIFIED 



222 



1 continued with during the covert activities? 

2 Well, that could go one. Yes. Why don't we do 

3 that question? 

4 A No. No. Going back to the statement that I made 

5 in connection with one of the questions that Mr. Nields 

6 asked me, I said there were time^hen we were going through 

7 a transition period. That period I cannot be precise 

8 about. We canceled some companies. I recall as I 

9 testified already yesterday, I maintained one of the 

10 companies, I believe it was Stanford Technology 

11 Corporation Services. 

12 So those — there was a transition period that I 

13 cannot be precise, but I can be precise about the fact that 

14 they were dormant, no substantial activity was going through 

15 them, no monies were there, and none of those companies 

16 were carried forward, changed names for the use of the covert 

17 activities. 

18 Q Could you tell us in a general way how the accounts 

19 that we are concerned about were operated? How was money-- 

20 who would give instruction to transfer money? Was that 

21 yourself? How was that money moved? 

22 A What part of the transfer? You see, there is 

23 transfer between CSF and the banks. See, you must -- 

24 MR. LIMAN: You looked upon CSF as the master 

25 account? II^SOl AQQiriT'^ 



358 




223 



1 THE WITNESS: CSF was my bank, the way I looked at 

2 it. 

3 MR. LIMAN: So you gave instructions to CSF. 

4 Which bank CSF puts the money in is at CSF's discretion? 

5 THE WITNESS: Exactly correct. 

6 EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 

7 BY MR. LIMAN: 

8 Q So if you told CSF transfer a million dollars 

9 from Lake to X, it is CSF that has to give the instruction 

10 to the bank? 

11 A That is precisely correct. 

12 Q And if you tell CSF we are going to receive X 

13 million dollars, CSF decides which bank to put that in? 

14 A Or would give us the account. 

15 Q Yes, but that is — it decides whether it goes 

16 into Credit Suisse or some other bank account? 

17 A You are right, Mr. Liman. You are precisely 

18 correct. CSF used the banks that they chose to use and they 

19 told us we operated — for instance. Energy or Lake, we didn't 

20 tell them to choose Credit Suisse to open the bank account 

21 with. They chose to. 

22 MR. NIELDS: Wait a minute. I think something 

23 has gotten mixed up here. You went over a chart yesterday 

24 of various bank accounts , Lake Resources — 

25 THE WITNESS: Companies. 



I 



359 



BHfBSSW 



224 



1 MR. NIELDS: Companies, but they also had bank 

2 accounts. You identified them as intake companies? 

3 THE WITNESS: Companies. Companies, Mr. 

4 Nields. 

5 BY MB. LIMAN: 

6 Q Let me be sure we have this clear. You were not 

7 the signatory of the bank account that Lake had, 

8 for exemple, at Credit Suisse or were you? 

N 

9 MR. IIIELDS: He was a signatory on some and not 

10 others. 

11 He was. 

12 MR. LIMAN: Some you were? 

13 THE WITNESS: The way I interpret all these 

14 outstanding questions, let me please make sure that I don't 

15 have language problems here. 

16 I — my understanding is that the following 

17 questions are to be answered. One, did we — did I choose 

18 banks that the corporations that we established to work 

19 with us, or CSF chose those banks for those companies. 

20 MR. NIELDS: The answer to that is CSF? 

21 THE WITNESS: CSF. 

22 MR. NIELDS: The next question is once you have 

23 chosen the companies and CSF has chosen the different bank 

24 accounts -- 

25 THE WITNESS: Did I have signature pqwer: -- . r 

■ ■kaABa..^ 



360 



uNtussro 



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1 MR. JANIS: Let him ask the question. 

2 MR. NIELDS: Who decided which account a particular 

3 deposit would be put into? You are about to get $15 million 

4 from Ghorbanifar. Who decided which account Ghorbanifar 

5 would put his money into? 

6 THE WITNESS: That would be our decision. I testi- 

7 fied that yesterday. 

8 MR. NIELDS: I thought you had , but I got mixed 

9 up. 

10 THE WITNESS: We had three collecting companies. 

11 We used one. Once we were finished, we went to the second one 

12 But we didn't choose the bank. 

13 MR. NIELDS: Which bank CSF got an account for 

14 for that company? 

15 THE WITNESS: Exactly. 

16 BY MR. LIMAN: 

17 Q But they gave you the number of the account? 

18 A Exactly. 

19 Q Therefore when you got $15 million from Ghorbanifar 

20 you could give them the account number? 

21 A Correct. 

22 Q On some of these bank accounts you had signature 

23 power? 

24 A That is correct. 
2^ Q And on others you didn't have signature power? 



i 



361 



UNCLASSIFIED 



226 



1 A Right. 

2 Q For excunple, you don't appear to have signature 

3 power on Energy. 

4 A That is correct. 

5 Q Even though that was your company and Mr. Secord's 

6 company? 

7 A Correct. 

8 MR. JANIS: I think it is fair -- 

9 BY MR. LIMAN: 

10 Q So how did you decide which ones you got 

11 signature power on and which ones you wouldn't? 

12 MR. JANIS: Mr. Liman , I also think it is fair to 

13 say based upon earlier testimony that some of the accounts 

14 he has according to -- that he now has signature authority 

15 on, he may not have had such authority until very late in 

16 the game. 

17 THE WITNESS: I am about to answer that. 

18 BY MR. LIMAN: 

19 Q Prior to November 1986, did you have signature 

20 power on amy of these accounts? 

21 A I would like to answer your first question, 

22 how did you choose to have signature power on one account 

23 and not another. I did not wish to have my signature on any 

24 account. 

25 There came a time, as I testified earlier, that I 



362 



UNCIASSIHED 



227-236 



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7 

8 

9 
10 
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25 



was very unhappy with the performance of one particular 
person in CSF who was basically handling our work. Mr. Farina. 
At that time I demanded to have signature power because 
I was the beneficiary of the company, and I had 
ownership of the company. 

I said I want to have the signature power. 
I want to cut Farina out. I am going to start going directly 
with the banks. I am unhappy. That — the decision was not 
based on the operation of each company. The decision was 
based on the efficiency of the system. 



UNCLASSIFIED 



363 



5: 00 p.m. 
DOTSON 

jml 




1 
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8 
9 

10 
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237 

fvj\ 

BY MR. LIMAN: 
Q What was that? I wasn't here yesterday. When was 
it you asked for the signature power? 

A I really did not feel that we had an on-going 
activity until the second channel started. Until the second 
channel started, I was not quite sure how long the renlationshid 
would last and when we would fold our tents and go. And I 
believe, if I am not wrong; I put my signiture on those 
accounts at that time. 

Q September, October 1986? 
A Something like that. 
Q And before that 

MR. NIELDS: He said summer yesterday, I think. 

THE WITNESS: And before that, I did not have any 
signature power. 

MR. JANIS: May I ask a question? 

Do the records we produced have the new and old 
signatures? 

MR. SABA: It is impossible to state. 

MR. NIELDS: I may have an answer. 

MR. JANIS: My recollection is the records produced 
a number of these bank accounts. There were more than one 
set of signature cards. You should be able to tell from 
the records when they were changed. 

MR. NIELDS: Here are two signature cards. This 

imni ACQiprn 



364 



llNtlHSSW 



238 



' one has Hakim and Zucker. Here is another one. And here 
2 is the 19th of July. It does not have Hakim. May 20. He 
^ changed late from an account that did not have, he was not a 
* signatory on which Bastion, Farina to one which has Hakim, 
^ Farina and Zucker. 

MR. JANIS: I think the records will answer these 
questions. 

MR. NIELDS: Let's take just a poke at some other 
accounts. 

MR. SABA: The change was subsequent to w^^Ht was 
provided to us. You are not aware of any further changes in 
the signatuory? 

MR. JANIS: No. 

MR. LIMAN: He is on ToyCo and Udall 

THE WITNESS: I should be on Hyde Park. 

MR. LIMAN: Hyde Park is not on according to our 

records, but that doesn't mean 

THE WITNESS: I definitely cun on Hyde Park. 

MR. SABA: He is on Hyde Park, but not on Barclay 



Bank. 

MR. LIMAN: Why don't we move on? 

MR. JANIS: The record should reflect that. 

MR, SABA: Whether or not you were signatory, it 
was understood you had authority to move from whoever was 
the signatory? 



IIMPI AQQincn 



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2 

3 

4 

5 

6 

7 

8 

9 
10 
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12 
13 
14 
lb 
16 
17 
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19 
20 
21 
22 
23 
24 
25 



UNCIASSIHED 



239 



THE WITNESS: If I went to the bank. 

MR. NIELDS: He means if you had the power to 
instruct CSF to move the money? 

MR. SABA: Did anyone else have that power? 

THE WITNESS: I have also testified to that, that 
eventually Mr. Secord got to the point he could do that if 
he wanted to, but he tried not to get involved as much as 
possible. We went through all that yesterday. I testified 
to this repeatedly. 

BY MR. LIMAN: 
Q He worked for you? 
A He worked for me, yes. 

MR. NIELDS: I would like to mark as Exhibit 1, 
a copy of a document marked as Exhibit 1. 

MR. JANIS: Let's go off the record. 
(Discussion off the record.) 



uwssw 




366 



^ (Back on the record.) 

2 BY MR. LIMAN: 

3 Q Mr. Hakim, you testified that you did not 
^ see deposition Exhibit 1 until it was roughly produced 
5 to us; right? 

MR. JANIS: No, I think he said until yesterday. 

7 THE WITNESS: Until yesterday. 

8 BY MR. LIMAN: 
Q Did you ever see any other record that was kept 

of the capital accounts of the parUbers of these entities? 

A At any time? 

Q Yes, ar. 

A In the same manner that I already testified to you 
when we went for check up now and then, and the computer 
read-outs were given, unless I testified earlier. Those are 
the documents that I saw in the past. 

Q And you say records therefore that allocated 
capital to particular partners? 

A Ito particular capital accounts? 

Q Yes. And do they use the same names, for example, 
Korel Assets, CTTEA? 

A I never monitored that account. 

Q And your own capital account was there? 

A Yes. 



Q Do you know what happened to those letters? 

llkWI AOOirii-- 



367 



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2 

3 

4 

5 

6 

7 

8 

9 

10 
11 
12 
13 
14 
16 
16 
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20 
21 
22 
23 
24 
26 



241 

A You are talking about the computer printouts? 
Q Yes. The ones that you saw that show the capital 
at the time you and you said General Secord visited Geneva 
because of the accounting foul-ups? 

A My best guess is they are CSF. I have no idea. 
Q Can we get those records? Have you asked for 
those records? 

MR. JANIS: I don't think I made a specific 
request for those records; no. 

MR. LIMAN: If there is any one thing clearly 
called for originally was the contemporaneous records and 
they should be produced. 

MR. WECHSLER: This indicates January 1, 1984, 
through -- what is this? 

MR. LIMAN: This is a record recently produced 
where you say the allocations are wrong. The other records 
may be screwed up too, but we would like to see them. 

MR. JANIS: Let me just make this clear. It 
seems to me from the record that has been produced, you should 

be able to pick any date and time and figure out 

MR. LIMAN: That may be, but we are entitled to 
see the records that they kept contemporaneously. 

MR. JANIS: Arthur, you are entitled to whatever 
you can get, and God bless you. I just want you to understand 
this was not a situation in which we intentionally tried to 
withhold some of our records. If that is the implication. 

iiiiAi inAiriri% 



368 



UNCUSSIFIED 



242 



^ MR. NIELDS: The way I see it is this. We understood 

2 notwithstanding the fact this document covered the entire period 

3 and therefore had to be created at the end of the period, 

4 that it reproduced faithfully everything that had — the interimi 
g reports that had been prepared earlier. 

g The problem is when we asked him about it, he said 

7 he didn't know anything about this document, and had never seen 

3 it before and therefore couldn't answer about it. Then in 

9 answer to Mr. Liman's question, he said he had seen earlier 

10 reports. 

It If his failure to see the document is the reason 

12 he can't tell us about it, we would like the reports he has 

13 seen. 

14 MR. LIMAN: We would like them anyway. 

15 MR. WECHSLER: We will see what we can do. 

16 MR. NIELDS: There are questions raised about 

17 whether this faithfully reports 

16 MR. WECHSLER: Whether or not they have the other 

19 ones, we will ask them. 

20 MR, LIMAN: Do I understand from your earlier 

21 testimony while John was out of the room, I want to make sure 

22 he hears it, that while you and General Secord inspected the 

23 records there you didn't take copies with you at the time? 

24 THE WITNESS: That is correct. 

25 MR. JANIS: One other point so we can make this 



369 



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26 



UNCUSSIFiED 



243 



clear on the record. When we went to what I believe was 
considerable difficulty to try to piece this puzzle 
together, and when — even before we produced the records, we 
told you that we indicated that notwithstanding our efforts, 
there might be further requests you make, and to the exten<- 
we could, we would try to comply with those requests. 

MR. LIMAN: Mr. Zucker,as your client has testified, 
is not only a friend, but is honorable and I am certain 
if Mr. Hakim asks him for the records of his accounts 
that existed contemporaneously, that Mr. Zucker will provide 
them to your client? 

MR. VAN CLEVE: I think as his trustee, he probably 
would have no choice but to provide the records to his 
beneficiary. 

MR. JANIS: When we know what additional records 
are required, we will go back and request them. 

MR. LIMAN: Let's go on to another subject. 

MR. NIELDS: I would like to, before we leave 
this document, I think this was done off the record — 
has it been marked Exhibit 1? 

THE REPORTER: Yes. 

BY MR. NIELDS: 
Q I have given Mr. Hakim's counsel a copy of Exhibit 
1. I would request, between the time we recess today and 
reconvene tomorrow, you look through the entries or. that documer 



row, you look through the 

luini Aooinrn 



370 



24 
2B 



UNCUSSIHED 



244 



1 and try to, to the best of your knowledge and memory, put 

2 yourself in a position to identify which entries relate to 

3 profit distributions, which relate to expenses that should 

4 not have been put in the capital accounts 

5 A Excuse me just one moment. 

6 Q Let me finish the question — and which relate 

7 to neither an expense or profit distribution but falls 

8 in sime other category. Is my question clear; 

9 MR. JANIS: In other words, it is sort of like 

10 who knew what and when? 

11 MR. VAN CLEVE: I haven't had a chance to look 

12 at this. I notice at the top of each page of this 

13 material, it says, document number contra. Is that the 
intended to mean — there are no references to Iran anywhere 
in here, and I just wonder in terms of the comprehensiveness 

16 of this document, does that mean all these transactions 

17 relate only to the contras: 
18 



MR. JANIS: Number one, I didn't create the 
document. Number two, I think your own accountants would be 
able to tell you. 

21 MR. LIMAN: Contra means offsetting? 

22 MR. VAN CLEVE: It is not a simple label. 
23 



MR. NIELDS: There are plenty of puns in this case 
and I think we have just found another one. 



llNi)M.^.<;inFD 



371 



UNCIASSIRED 



245 



1 BY MR. NIELDS: 

2 Q I would like to move now on to the subject of the 

3 two different projects that you were working on. I think 

4 we can cover anything briefly. Some of these questions 

5 were already asked. 

6 I take it you were aware — you have already 

7 testified about the arras sales and the arrangement with 

8 respect to the arms sales, but I take it you were aware there 

9 was a resupply operation? 

10 A You are talking about the contras now? 

11 Q Yes. 

12 A Yes. 

13 Q The answer is yes, you were aware of that? 

14 A Yes. 

16 Q And the enterprise, so to speak, purchased various 

16 aspects in order to run the resupply operation including 

17 planes and air strips? 

18 A Yes. 

19 Q Was it your understanding that those assets were 

20 committed to the purpose of assisting the contras? 

21 A Yes. 

22 Q Did there come a time when there was an issue 

23 about whether those assets should be transferred in asme 
2* fashion to an agency of the U.S. Government? 

* '"■ KMPIACCin'-- 



372 



UNCUSSIHED 



246 



4 Q Was that issue discussed with you? 

2 A NO. 

3 Q Well, how did you learn about it? 

4 A My understanding, discussed with me, is that 

5 I participated in a decision-making discussion. 

g Q There was a decision-making discussion you partici- 

7 pated in? 

S A Or planning, decision — I did not participate 

9 in such a meeting, but I 

10 MR. LIMAN: I don't understand that. 

11 MR. NIELDS: Well, I understand it. He is saying 

12 he did not participate in the discussion with the U.S. 

13 Government. 

14 MR. JANIS: He is saying if I understand him 

15 at this point, that he didn't participate in any discussions 

16 in which a decision was made, and that is what he thought you 

17 meant. 

18 THE WITNESS: I am saying there were operational 

19 people, Dutton and Secord basically, it was their decision, 

20 it was not financial, it was either between this political 

21 circle or the operational circle; I had nothing to do with 

22 it. 

23 BY MR. NIELDS: 

24 Q But somebody talked to you about it, either 
28 Dutton or Secord? 



iiNniKQinrn 



373 



23 



uNcinssra 



247 



\ -- A They did not talk to me about it. I happened 

2 to be in Stanford Technology Corporation when they were 

3 discussing this. When Secord commissioned Dutton to go 

4 look into this and prepare a report, I was aware as part of the 

5 discussions -- it was not that we had staff meetings, we 

6 sat down and reported. 

7 Q What was your understanding of what was going to 

8 be done with these assets? 

9 MR. VAN CLEVE: Can we back up a second. 

10 Was any of your money tied up in these assets, 

11 any money that you thought personally belonged to you? 

12 THE WITNESS: I don't think so, 

13 MR. LIMAN: Is what you are saying, you overheard 

14 discussions between Dutton and Secord? 
18 THE WITNESS: Yes. 

16 MR. LIMAN: And you heard, among other things, 

17 they were preparing this 

18 THE WITNESS: Reorganizati^. 

19 MR. LIMAN: reorganization plan? 

20 THE WITNESS: Yes. 

21 BY MR. LIMAN: 

22 Q Did you overhear discussions whether these assets 
should be sold or given to the CIA? 



24 A Yes. 



25 Q Tell us what you over^Jheard and who was speaking? 

IIKIOI ACCIPri* 



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3 

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UNCUSSIFIEO 



248 

A Basically, at different times I overheard discussion 
between Dutton, Secord and some telephone conversations, 
and sometimes Dutton addressing me about what he was 
preparing, and I would very respectfully listen to the part 
of the discussion I could not escape from, and move out. 

Q What was said? 

A What was said; that it was a big mess, it took 
a long time to put these things together, finally we have 
organized it, finally we know what we got, and they — 
I think they provided a copy of a report or a plan, a write-up 
to, Oliver North. 

I also think that when this was happening, Richard 
was in and out of the United States. I recall phone calls 
to Richard about how to deal with certain issues. 

Q What issues? 

A That they had on hand. Reorganization and pre- 
paring the report. 

Q What about disposition of the assets? 

A Everything was, to the best of my recollection, 
left to the time that Richard could come and sit down and 
talk to Bob Dutton, and I believe the meeting took place, 
I was not present, I overheard about the possibility of 
giving the assets to the CIA. I heard about the possibility 
of selling it to the CIA. 

I heard at different times that the CIA didn't 
want anything to do with this, saying that this is tainted, 

• ■iiAi ■ AAirirr» 



375 



HNCussre 



249 



f they didn't want to inherit something that had holes in it 

2 or that was exposed. 

3 MR. VAN CLEVE: Who would have gotten the money 
^ if the assets were sold to the CIA? 

g THE WITNESS: I have no idea. 

Q BY MR. NIELDS: 

J Q This would have been an issue that would make a 

g financial difference to the enterprise, I take it. If you 

g give it away, the enterprise gets no money. If you sell 

■JO it the enterprise does get money. 

tt A Your assumption is correct. 

12 Q Now, did anyone discuss with you this question of 

13 whether you are going to dispose of these assets without 

14 any money coming in, or not? 

IB A Asking my opinion about this? No, no one did. 

16 I classified that as a political decision, not a commercial 

17 decision, 

18 MR. LIMAN: Wait. 

19 EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 

20 BY MR. LIMAN: 

21 Q From a political point of view the correct decision 

22 would be to give it away; right? 

23 A That is correct. 

24 Q But you knew there was discussion about whether 
26 to sell it? 



UNCI A.<;<;iFirn 



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maissw 



250 



A There were ideas underscored whether they 
should sell it or not. 

Q If you are going to sell it, you are going to — 
someone will get money for selling it? 

5 A If they sold it, yes. 

6 Q Who would benefit from selling it? 

7 A You are asking for my opinion, or what I heard? 

8 Q What did you hear? 

9 A I didn't hear anything about who would be getting 

10 the money. 

11 Q Did you hear any argument as to why this should 

12 be sold rather than given away? 

13 A I recall a discussion that, I believe, it was 

14 held in the office of STTGI prior to Bob Dutton going to a 
16 meeting, I don't know what meeting, and Richard apparently 

16 was not going to go to that meeting, and I recall a statement 

17 to the effect, get rid of the damn thing and move on with 

18 our lives, just give it to them, let's get on with our lives. 

19 EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 
BY MR. NIELDS: 

Q That makes it sound as though there were an 

22 earlier discussion in vrtiich there was a dispute. 

23 A I wouldn't call it dispute. There were different 
options. 



UNCUSSIFIPn 



377 



12 



16 



18 
19 
20 
21 
22 
23 
24 
25 



mmvm 



251 



1 " Q Someone was arguing for one option and someone 

2 else was arguing for another option? 

3 A I believe so. 

4 Q Who was arguing for which option? 

5 A I cannot swear t<^ this, I can not be certain 

6 about this, but I believe Outton was interested in 

7 selling this to the government. 

8 EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 

9 BY MR. LIMAN: 

10 Q Would you not agree with me that once you tell 

11 the recipient that you will give it to him, it is hard to 
tell the recipient you will sell it to him; right? 

13 A But my understanding was that the recipient did 

1* not want to get it in any way or form. 

15 Q But would I be correct in my assumption that the 
first idea was to try to sell it to the CIA, then when the 



^^ CIA indicated no interest the idea became, let's try to give 



it to them, and then the CIA said it didn't want it? Is that 
the way it evolved? 

A Mr. Liman, you are getting me involved in this 
deeper .than I was by asking me these questions. 

Q I don't care whether you were deep or shallow, did 
you know? 

MR. JANIS: Let him answer the question. 

THE WITNESS: I cannot say Mr. Dutton attended the 

lUim AOOinrn 



378 



muivm 



252 



1 meeting to negotiate with the CIA. He could very well have, 

2 to discuss this with North, to sort this thing out and get 

3 his opinion. 

4 MR. LIMAN: I asked you about the sequence of the 

5 ideas. W=<s the first idea or concept to try to sell, 

6 and then the next one to try to give it away? 

7 THE WITNESS: I don't know that, sir. 

8 BY MR. LIMAN: 

S Q You just know that both of these things were 
'0 floating up in the air? 
A Exactly. 
Q And in the end, because the CIA considered these 

'^ to be tainted 

^* A They did not want to have anything to do with it. 
Q Was there any discussion about giving the CIA the 
munitions? 

A I don't recall any meetings, discussion or anything 
that I overheard that particularly directed its attention to 
that particular subject. 

Q Who made the decision to sell the munitions to 
the CIA? 

A I said I don't recall having heard anything in 
connection with sales or giving away the munitions to the 
CIA. 



Q If you didn't make the decision, then does that 

iiiiAi ioninrn 



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253 



\ necessarily mean that it had to be Mr. Secord who made 

2 the decision? 

3 MR, JANIS: Excuse me. 

4 MR. LIMAN: I am talking about the million two — 

5 what you called the advanced shipment. 

6 THE WITNESS: I am sorry. 

7 BY MR. LIMAN: 

8 Q Who make the decision? 

9 A I am in a totally different world. 

10 Q Let's talk about the advanced shipment. Who made 

11 the decision to sell that as opposed to giving it to the 

12 CIA? 

13 A I don't know. If I have to deduct I would say 

14 General Secord. 

IB Q You didn't make the decision? 

16 A No, I did not. 

17 Q Is it fair to say there is only one other person 

18 who could have made that decision and that would have been 

19 him, if you didn't, sir? 

20 A If I could say that all the players were limited 

21 to the people that I came in contact with, then that assumption 

22 is correct. I don't know. 

23 Q Would Clines have been able to make that decision 

24 without General Secord 's concurrence or your concurrence? 
26 A I would say that Tom Clines would definitely — 

iium innirirn 



380 



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UNCUSSIFIED 



254 



1 was definitely in a position to influence the decision. 

2 Q But who would have to make the decision? 

3 A I would say General Secord had to make the decision. 

4 What I am trying to say, Mr. Liman, I don't know if it 

5 was Mr. Secord who made the decision or North. I really 

6 don't know. Because I would classify that as — I classified 

7 it, I was not present in the meetings. I classified that as 

8 a political decision. It was very possible that North 

9 made that decision. 

10 EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 

11 BY MR. NIELDS: 

12 Q As a businessman, did you understand that you had 
a personal financial interest in the assets of this resupply 

14 operation? 

'6 A It didn't occur to me. I didn't look at it that 
way. I never in my mind psychologically prepared myself 
there would be a transaction. 

To me it was written off. Anything that went to 
anything in my mind as a businessman, I wrote it off. I 
did not ever at any time took the attitude that anything 
that was invested — I am talking business language — in 
Nicaragua could have a return. 

2^ BY MR. NIELDS: 

Q How about Iran? 



AQCICirn 



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1 A Could you be more specific about your question? 

2 Q How did you regard the difference between the 

3 purchase price on the Iranian initiative? 

4 A How did I 

5 MR. LIMAN: Did you have an interest in that? 

6 THE WITNESS: Of couse I had an interest in chat. 

7 BY MR. NIELDS: 

8 Q What was the nature of your interest? 

9 A In the difference? You are talking about 

10 what period in this Iranian initiative? 

11 MR. LIMAN: Before the second channel. 

12 THE WITNESS: Before the second channel, the 

13 focus 

14 MR. LIMAN: The question is: What was your 

16 economic interest in the difference between the cost of these 

16 weapons and what you got from selling them? 

17 THE WITNESS: My attitude was that I did not 

18 want to kill the rooster with golden eggs. I did not 

19 wamt to 

20 MR. NIELDS: I understand what he is saying. 

21 THE WITNESS: I wanted to see primarily — and I 

22 will set aside any emotional, untangible feelings about this, 
I will not discuss it, I will go straight to the tangible. 



2* monetary interests of this. That we can discuss over a drink. 
25 But this particular one, I had focused for a numbfir of years. 



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UNCLASSIFIED 



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1 even prior to the events, to find a way into Iran. 

2 Iran has always been, still is a very lucrative 

3 market for me. I intended to make big money out of that market. 

4 I still do, and I am continuing with my efforts. And, by the 

5 way, I should tell you, unlike what has been reported in 
g the newspapers that have been disapp-^aring for unlawful 

7 reasons, I was for five straight months trying to reconnect 

8 the business structure that I had lost and was destroy^ 

g in Iran by the Iranians, and thank God I had a lot of success. 

10 So for a long time my focus on Iran was there is 

11 a $15 billion a year market. Sooner or later I get a chance, 

12 and I should get a chance to get a stab at it. So 

13 when this first channel was started, I did not focus at the 

14 beginning on the profits or mark up in the same manner 

15 that we are looking at contras. 

16 I am not saying that I ever let the possibility 

17 of making such money out of my mind. If an opportunity 

18 would have arrived that I could have done that, I would have 

19 done it. I will never apologize for wanting to make money, 

20 that is what I am trying to say. 

21 But my main focus was to make sure that a 

22 relationship between Iran and the United States is established 

23 and I knew once that was one I can make a bundle. 



UNCUSSIRFn 



383 



WIASSW 



257 



1 EXAMINATION ON BEHALF OF THE SENATESELECT COMMITTEE 

2 BY MR. LIMAN: 

3 Q In the first transaction, which was a thousand 

4 TOWS, you got $10 million from Ghorbanifar, you paid 3-5 

5 to tie United States Government, you had some expenses on top 

6 of it, so it brought it up to probably somewhere around 

7 4. There was $6 million there. Whose money was that? 
A The enterprise. At no time there was a question 

we were going to split the profits. 

EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 
BY MR. NIELDS: 

Q I want to make this clear. I take it the 
enterprise also owned the assets of the resupply operation, 
the airplanes down in Nicaragua? 

A At that time if we still had it? 

Q Yes, you did. 

A Okay. 

Q The enterprise also owned the $6 million profit 

from Iranian arms sales? 

A You refer to it as profit. It is gross income. 

Q It is $6 million money? 

A Okay, fine. 

Q Now, you have said that you did not regard yourself 
as having any personal interest in the assets of the resupply 
operation in Nicaragua. Did you regard yourself as having 



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any personal financial interest in that $6 million? 

A Having financial interest meaning that I expected 
to have part of that? 

Q For yourself? 

A No. 



UNCLASSIFIED 



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BY MR. LIMAN: 
Q If the United States Government decided at that 
moment in time there would be no further transactions -- 
A What would be my position. 

Q Wait a minute. No further transactions with 
Iran and you were sitting there with roughly $6 million 
in gross income or gross profit, what was your position 
as to whether you could use that money for whatever 
purpose you wanted? 

MR. JANIS: What would have been his position. 
MR. LIMAN: Well, at the moment you only have 
one transaction. 

MR. JANIS: You are asking what his position 

would be — 

MR. LIMAN: At that moment. 

THE WITNESS: You are saying if the U.S. 
Government decided to stop, what my position would have 

been. 

MR. LIMAN: They were considering stopping. 

THE WITNESS: I'm glad you asked the question 
in the way that you asked it because it makes it easy 
for me to answer that question. 

If the United States would have made that 
decision, I guarantee you I would have put up a big 
fight to get as much as I could from that money before 



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letting it go. 

BY MR. LIMAN: 

Q Let me follow that up. Who would you have had 
to fight with? 

A I would have had to fight with Secord and on 



up. 



Who is up? 

North . 

And what did you understand their position was? 

It never occurred to me. 

MR. NIELDS: The question I want to ask — 

THE WITNESS: We were not of that frame of 
mind. You asked me what I would have done, and I 
truthfully told you that I was financially motivated. 
If in the middle of my getting involved, forgive me for 
being so pregnant with the U.S. Government, I was not 
going to let the U.S. Government go in there before they 
paid for my efforts. I had a lot at risk and supposed, 
and I told you over and over that I don't work for 
medals. Medals are for generals. 

MR. LIMAN: You told that to North? 

THE WITNESS: I told that to everybody and 
I used that repeatedly. 

BY MR. NIELDS: 
Q Whose decision woii^d it havj^een? 



387 



UNCIASSIRED 



261 



1 A To do what? It would have been a battle. I 

2 would have to see if Secord is going to be on my side 

3 or sitting across the table from me. 

4 MR. LIMAN: It would have been some battle. 

5 THE WITNESS: You bet your life. 

6 MR. LIMAN: If you didn't survive it, then 

7 under your will he controlled it. 

8 THE WITNESS: I don't believe there was a 

9 will then. I don't believe there was a will then. 

10 Mr. Liman, until things become serious, and 

11 I told you I consider things become serious when the 

12 second channel started, I really did not make an attempt 

13 to organize things. 

14 BY MR. LIMAN: 

15 Q Six million dollars is serious money even for 

16 you. 

17 A For anybody. I told you if they would have 

18 stopped that operation, I "have made every effort that I 

19 could, even taking it to court, to take as much moriey 

20 from that money as I could. 

21 Q Did you have ciny agreement with either North 

22 or Secord as to how that money would be used? 

23 A No, none whatsoever. 

24 BY MR. NIELDS: 

25 o Had it ever been discussed between you and 



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1 Secord or you and North? 

2 A What? How this thing would be used? 

3 MR. VAN CLEVE: The $6 million. 

4 THE WITNESS: It was never -- we were not in 

5 that frame of mind. We were not in that frame of mind. 

6 BY MR. NIELDS: 

7 Q Who in fact was deciding how that money would 

8 be used? I'm not asking you an "if question now; I'm 

9 asking you a real question. 

10 Who decided how that money was used? 

11 A There was no question in my mind that the 

12 engine, the heart of the operation was Secord. No 

13 question in my mind that he would have been an influential 

14 person making that decision, if not the person. 

15 Q I'm not asking an "if question. The money was 

16 actually spent, some of it, the $6 million. It's not all 

17 remaining. It was spent for various things. It was 

18 spent for expenses on Iran. It was spent for the 

19 contras. 

20 A I understand what you are saying. Secord. 

21 Q It was spent on radios — 

22 A I understand your question now. Secord. 

23 Q How do you know that? 

24 A He was the one who told me what to do with it. 

25 Q Do you know if he was responding to what North 



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told him? 

A I'm sure that he was communicating with North. 

BY MR. LIMAN: 
Q Did you consider yourself really Secord's 
nominee with respect to this money? 

A You are talking about the $6 million? 
Q Yes. The gross profits, the gross income on 
these Iranian transactions. 

A Did you want me to answer this question as a 
businessman? 

Q As a businessman. 

A As a businessman — would you be patient with 
me to finish the way I will give you the story or you 
are going to interrupt me with legal questions? 

Q I'm going to listen to you if you're responsive. 
A Mr. Liman, I have every, every intention, so 
God help me, to help this committee. I consider myself 
a member of a team trying to end with this episode so we 
can get on with our life. I want to go out there and 
get money. I want to attack that $15 billion market. 
I have not given up. So I will do everything I can to 
bring this thing to an end as quickly as possible. 

To me it was a start-up business. We started 
up the business to attack the Iranian market, and I'm 
not talking about the political or military aspect of it. 



390 



UNtUSSW 



264 



1 You are asking me my frame of mind. And I told 

2 you earlier that I would not in any way kill the -- 

3 MR. NIELDS: The goose that laid the golden 

4 egg. 

5 THE WITNESS: Thank you. 

g So when you asked me the question, okay, 

7 Albert, stop, look at this, there's $6 million sitting 

3 here; what are you going to do with it? That's not my 

g way of thinking. My way of thinking is, we have this 

10 asset, there is a $15 billion market there, if I can get 

11 2 percent of that per year, that's $300 million a year. 

12 If I can net out of that 3 percent, I will be making a 

13 bundle. That is the way I would be thinking, Mr. Liman. 

14 BY MR. LIMAN: 

15 Q Do you want to answer the question? As I 

16 understand, that is the way you as a businessman would 

17 think. But with respect to the $6 million and the other 
13 mark-up and Hawk parts transactions, did you consider 

19 yourself to be General Secord's nominee? 

20 MR. JANIS: Do you understand the word 

21 "nominee"? 

22 MR. LIKAN: Agent. 

23 THE WITNESS: I understand the meaning of 

24 that. The problem I have is I cannot answer the question 

25 because such a thing never was discussed and never 



391 



UNCUSSIRED 



265 



1 occurred. 

2 BY MR. LIMAN: 

3 Q Did you follow General Secord ' s instructions 

4 on how to disburse the mark-up? 

5 A Yes, sir. The answer to that question is yes. 

6 Q And Mr. Nields mentioned to you some of the 

7 things you spent it on; whether it was a ship or on 

8 Motorola radios, some of the money was also invested for 

9 the benefit of you and General Secord. Isn't that 

10 correct? 

11 A Today you can reach to that conclusion. Today 

12 you can reach to that conclusion. Because the project 

13 is aborted, because there is no longer corporate activity, 

14 because there is no longer a commander in charge of this 

15 covert activity. Yes. The answer is yes. Then it was an 

16 ongoing operation. 

17 Q But the ongoing operation — 

18 A Needed to stay alive. 

19 Q The ongoing operation did not include buying 

20 a machine gun company, did it? 

21 A The ongoing company did not include — why 

22 not? 

23 Q Well, is that the way that you envisioned it, 

24 that you were buying the machiiftjt'gun company for the 



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A No. We were buying it for our own benefit, 
but I don't see the relationship between the two. 

Q Didn't you disburse -- 

A I have difficulty relating the two. 

Q Didn't you disburse profits, money -- let me 
put it that way — change the question. Did you not 
disburse money that was generated by the Iranian arms 
sales to invest in the machine gun company with General 
Secord? 

A I did not classify it or distinguish it as 
such. I thought I was reaching out for the profits 
that we had generated from the sales of arms to Nicaraguans. 
If we dipped into the Iranian money, it was an overdraw; 
it was a mistake, it should not have happened. I have to 
consult the records to answer your question. I don't — 
I had definitely no intent of reaching into the $6 million 
pot eind making an investment for submachine guns. 

Q The $6 million pot is the residual after all 
of these other expenditures, isn't it? 

A What other expenditures? You mean for the — 

Q Whatever else you spent it for. The $6 million 
pot is what is left after you buy a ship, after you send 
money down for the air resupply operation? 

A Did we buy the ship at the time we received 
the S6 million? llMni ilOnin*— 



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267 



1 Q The $6 million is -- we're talking about two 

2 different 6 million. The 6 million I was talking about 

3 is what is left, and you are talking about the 6 million 

4 of the original profit? 

5 A Yes. 

6 Q The 6 million — the ship you bought I believe 

7 after the TOW transaction and just before the money was 

8 received on the -- 

9 MR. NIELDS: Hawk parts. 

10 THE WITNESS: Mr. Liman , let me tell you what 

11 my frame of mind is. I'm still ansv^ing or thinking that 

12 I am answering the questions related to the first -- 

13 MR. LIMAN: Six million? 

14 THE WITNESS: The first 6 million. 

15 BY MR. LIMAN: 

16 Q Let me then go back . 

17 A Okay . 

18 Q There was a gross profit that was made on 

19 that first 1000 TOW transaction — 

20 A Through Ghorbanifar. 

21 Q Through Ghorbanifar. Correct? 

22 A I take your word for that. I do not know. 

23 Q Did you not know at the time there was a 

24 mark-up? 

25 A How I knew what the mark-up — there was a 



394 



mnrnm 



268 



1 mark-up, but I did not know what the mark-up was. I 

2 did not know what the cost was. 

3 Q I thought that you testified that you and 

4 General Secord would visit from time to time to talk to 

5 ZucKer and to look at the bottom line. 

6 A Yes. 

7 Q And did you not learn after the 1000 TOW 

8 transaction that there was a — 

9 A Leftover. 

10 Q — gross profit or leftover of somewhere in the 

11 neighborhood of $6 million? 

12 A The answer to that question is yes. But 

13 mark-up, knowing what the mark-up is, I don't know what 

14 the mark-up is. 

15 Q So you knew that you had — 

16 A A leftover. 

17 Q — a surplus from that? 

18 A Oh, yes. 

19 Q And then when the Hawk part transaction 

20 occurred in May, you knew there was a surplus there 

21 too ? 

22 A I learned that too, yes. 

23 Q Now, you disbursed the surplus from these two 

24 transactions in various ways, correct? 

25 A That is what the records _show^ yes. 



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Q And those disbursements, as I understand it, 
were at the instruction of General Secord? 

A Effectively, yes. 

Q And among the things that you bought were a 
ship? 

A Yes, sir. 

Q Some planes. 

A Yes, sir. 

Q You sent some money down for the airlift 
operation? 

A Yes, sir. 

Q You bought some munitions? 

A Yes, sir. 

Q And you also used money for some investments , 
correct? 

A Out of the total moneys that were left over 
there, including the profits that we had accumulated from 
the sales to the contras . 

Q Is it your testimony that you believed that all 
of the money that you disbursed for your benefit, Mr. 
Secord 's benefit and Mr. Clines' benefit came from the 
profits on the sales of arms to the contras and none of it 
came from the sales of weapons to Irsm? 

A First of all, I would like to get Mr. Clines 
out of this. I had nothing to do with his profit sharing, 



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HHWSSm 



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1 and he was not part of the group. 

2 To answer your question, I never stopped to 

3 make the differentiation whether this was the case or 

4 not. The business opportunity came about. We had money. 

5 I reached in there, paid for it and never made an accounting 

6 for that. It's very possible that some of the money from 

7 the Iranian sales was used for that purpose. 

8 Q Did you feel that you and General Secord were 

9 free to use the money that was generated by the Iranian 

10 arms sales for your own business purposes? 

11 A To a certain extent, yes, I did. To the extent 

12 that I thought that sooner or later I would be entitled 

13 to some income from my efforts for this covert activity, 

14 I thought we were free to do what we wanted. But I never 

15 felt free to completely use all the money, and I'm 

16 talking about that period of time. 

17 Q You couldn't use all of the money. 

18 A I did not feel free. Technically, I could. 

19 I'm saying, you asked me a question, if I felt free. 

20 You are talking about my conscience, my frcime of mind 

21 when you say free. 

22 Q Did you understand that if you took the position 

23 that you were going to use all of the money for profit- 

24 making ventures of yours and General Secord that Oliver 
95 North might stop usina vou as +-h<» intermediarv? 



397 




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1 A He didn't have to stop using us as the inter- 

2 mediary. That would be automatically stopped. If he did 

3 that, that was it. The operation would not have continued. 

4 Q Why ? 

5 A We had no money to operate from. 

6 MR. NIELDS: You had no money when you started, 

7 did you? 

8 MR. JANIS: It's hard enough to answer one 

9 question. This is a tag- team battle here. Give the guy 

10 a break. 

11 MR. NIELDS: I'm going to ask the next question 

12 anyway just for fun. 

13 EXAMINATION BY THE HOUSE 

14 SELECT COMMITTEE 

15 BY MR. NIELDS: 

16 Q In each transaction the purchase price was paid 

17 into your bank accounts before the U.S. Government was 

18 willing to ship the arms . So each transaction could be 

19 completely funded out of the purchase price that was 

20 received for that transaction. Isn't that true? 

21 A That is true. And the U.S. Government never 

22 shipped before you got paid. 

23 Q Then why would you need any residue in those 

24 bank accounts in order to do the next transaction? 
"■^ MR. JANIS: Just a minute. 



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MR. LIMAN: Off the record now. 

(Whereupon, at 6:00 p.m., the deposition 
adjourned, to reconvene at 1:00 p.m., on Sunday, 
May 24, 1987.) 



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STBHOGR.\PHIC MDOJTES 
Unrcvised and Unedited 
Not for Qaotation or 
Duplication 



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Committee Hearinsrs 

of tlM 

U.S. HOUSE OF REPRESENTATIVES 






Partially Declassified/Released on || J/^lO 58 
under (irovisrons ol E !2356 
by K Jormson, National Sscu'ity Council 



OFFICE OF THE CXERK 
OIBm of Official Reporters 



UNCUSSIRED .^-w-.^ 



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401 



UNClASSra 



DEPOSITION 0'=" ALBERT HAKIM 

Sunday, hay 24, 1987 

U.S. House of Representatives, 

Select Committee to Investigate Covert 

Arms Transactions with Iran, 
Washington, D.C. 

The Committee met, pursuant to call, at 1:20 p.m., 
in Room H-139, the Capitol, with John Nields presiding. 

On behalf of the House Select Committee: John Nields, 
George Van Cleve, John Fletcher, Joseph Saba, Robert Brink 
Ronald Points, M'.clvoUs VOi^e^ 

On behalf of the Senate Select Committee: Arthur Liman, 
Cameron H. Holmes, Timothy Woodcock, Louis Zanardi, David 
Faulkner, N«t^^S^ilM», Paul Barbadoro, John Monsky. 

On behalf of the Witness: N. Richard Janis, Lawrence 
H. Wechsler, and Clement R. Gagne , III; Janis, Schuelke & 

Wechsler, 1728 Massachusetts Avenue, N.W., Washington, D.C. 

Declassified/Released on _L!_J^ 88 
20036. . . '.^ n la tftk ,«^ <'.'*■' 8^ m unoer provisions ol E 12356 

H Jofinson National Sscunlv Council 



yNMSSIrlEO 



402 



UNtUSSIHED 



MR. NIELDS: Let's go back on the record. 

Mr. Janis has something that he wants to say as we 



begin. 



MR. JANIS: Just to amplify the record, I spoke 
to Mr. Liman and Mr. Nields just before he resumed today just 
to alert them again that with respect to the stranded shipment, 
I think that it would probably be prudent since to some extent 
Mr. Hakim was speculating about the numbers, it would probably 
be prudent to try to relate the total amount paid — let me 
try to jxit this another way. 

We had assumed that the totality of the last shipment 
was represented by the $1.7 million paid to Defex in July. 
I reviewed the records again last night and I noted that 
there were payments in late May to Defex totalling something 
like $800,000 or in that ball park, emd I had assumed and it 
may be a correct assumption, that those payments had nothing 
whatever to do with the stranded shipment in which case the 
speculation would seem to be correct that Mr. Hakim made 
yesterday. 

But I think before any final conclusion is reached, 
you all, with the statements you have, or somebody, should try 
to go back and determine whether the payments made in May 
1986 to Defex did or did _no^ xelaXe_ta. that last stranded 
shipment. 

I think that would be useful for everybody's purpose. 



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MR. NIELDS: That is fine. We appreciate the 

statement. 

I guess I should probably just add for the record 
that we have seen those same payments to Defex and we would 
note that there were other 30-30-30-10 distributions to the 
partners following those May payments to Defex. 

MR. JANIS: And we figured the record would be made. 
The truth will be the truth and whatever comes out comes out. 
I just wanted to be sure that was pointed out. 

MR. NIELDS: Okay. Good afternoon, Mr. Hakim. 
Whereupon, 

ALBERT HAKIM 
having been previously duly sworn, was recalled as a witness 
herein, and was further examined and testified as follows: 
THE WITNESS: Good afternoon, Mr. Nields. 
EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 
BY MR. NIELDS: 
Q We are continuing, of course, the deposition that 
began on Friday and continued over to yesterday. As we 
broke yesterday, we were on the subject of what your under standi] 
was with respect to the profit or surplus left over from the 
sales of arms to Iran. Just to sharpen my question ~ 
because we very much want your help on this issue and it is a 
very important issue to the committee — the United States 
Government chose.tjx uag-a xonpneix^l^uit-out in connection 



iMi'ssm 



404 



(INCUSSIFIED 



with these sales to Iran and I take it that was your 
enterprise, yours and Mr. Secord's enterprise? 

A That was the terminology that Mr. Secord used. 

Q Right. And the United States Government chose in 
that connection to sell the arms at S25 million, that would 
be the first TOW shipment of a thousand TOWs and the Hawk 
spare parts that were shipped in May, and it was done in 
such a way that the United States Government accounts 
received eight million of that 25, and the commercial cut-out 
received 17 million. 

Of course, there were certain expenses to be paid 
out of the 17 million and they were paid out of it according 
to Mr. Secord's testimony and the question which interests 
the committee and it is a very important one and anything 
you can do to help us with this would be very much 
appreciated is, why did the Government choose to structure 
the transaction in such a way that there was a many million 
dollar surplus left in the enterprise account? 
MR. JANIS: Off the record. 
(Discussion off the record.) 
BY MR. NIELDS: 

Q Eight million to the U.S. Government, 17 million 
ended up in Lake Resources account. My question to you, my 
first question to you is, and as I say, this is a very 
important question to the commi tl^A ^rp^nything you can do to 



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help shed light on this question would be much appreciated 
by the committee -- why did the Government choose to structure 
the transaction in such a way that there was this many 
million dollars surplus in Lake Resources? 
(Witness conferring with lawyer.) 

THE WITNESS: Mr. Nields, I recognize the importance 
of the question that you are asking. I have been in many 
different ways trying to ask the very same question for myself 
and try to find it best answered that I come up with at 
least to satisfy my own mind, so I would be prepared to answer 
the committee's question or in this deposition your 
questions, I believe yesterday we made some progress when this 
line of questioning finally was led to what was the 
enterprise. 

I believe that is where we broke off yesterday 
when Mr. Liman tried to understand what was the enterprise 
and I left the meeting of yesterday this question on my 
mind and on the mind of my attorneys and we tried for the 
millionth time — I am exaggerating, of course, too — to 
go over the same question working very hard to understand 
what this all means. 

With the help that indirectly was given to me as a 
result of the deposition and with the cooperative effort 
that I have been noticing in these depositions, that there 



UNClASSInED'' '" " " '°'' '° ^^ '° '*'"'^" '"^^ '"'" 



406 




UNCLASSIFIED 



and focus on the bottom line and I learned quite a bit over 
the past few days, finally last night I tried to restructure 
all these events in different form by going to very basic 
issues and try to in my mind at least solve this complex 
situation and I came to the conclusion that I can continue 
to be cooperative, I can continue to be truthful and at the 
same time I can give you answers that would be contradictory 
and all this is the result of the original design of this 
activity. 

I was told — and this is not my opinion — I was 
told by General Secord that we are getting into a totally 
private endeavor on behalf of the U.S. Government for both 
the Nicaraguan initiative and the Iranian initiative. 

The past few days we have sorted out this situation 
of the contras. We haven't gotten deeply into the situation 
of the Iran and there is — at least my understanding is that 
we still don't have an understanding of what the enterprise 
is. 

So here I zmi a businessman, his business partner, 
who had sensitive, very sensitive positions in the U.S. 
Government for whom I have a lot of value and for whom I have 
a lot of respect. He has a remarkable track record. This is 
important. I am not trying in these testimonies to build him 
up. I am trying to give you my state of mind. 

A mar. comes with such a background to me and then he 



407 



1!^'!^! ASSIFIED 



1 

2 

3 

4 

5 

6 

7 

B 

9 
10 
11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 
23 
24 
25 



tells me that we are going to — we are going to start a 
covert activity on behest of the United States Government 
approved by the United States, the President of the United 

States. 

Okay. I make obviously no apologies that I may 
have jumped into a lot of conclusions as a result of that 
statement, but my understanding was that we are going to get the 
support of the United States Government and go into this as a 
private company, private individuals and do transactions as 
it is conventional and normal. 

That was how the whole thing was set forth to me and 
that is how we got started. 

Then as we got deeper into this, I started to see 
things that, you know, started not to make sense in the mind 
of a conventional businessman. I saw General Secord 
playing a very important role in this. I saw the result of 
his decisions. 

I saw the result of his judgments. I saw the number 
of times that Mr. North consulted with him. 

So I saw the man has importance in this whole 
operation. Then at the same time I see that there are 
times that Oliver North becomes, if not as important, if 
not more important, but definitely very important in our 

So I am sitting back looking at this thing and totally 



408 



ICUSSIFIED 



relying on my trust in General Secord and his 
comprehension, understanding, experience with the U.S. 
Government and totally trusting him and I continue to trust 
him today, that he understands this complex U.S. structure, 
the government structure, better than I do, so my 
partner, my friend, is in there, I trust him. He knows, 
so I am not going to bother with this. All I know I am a 
businessman and I am supposed to run things as a businessman 
does. 

So then at the same time I see conflicting 
approaches. I see — to give you an example, Oliver North 
wants to« much money for the contras and sometimes he gets 
it, sometimes Richard says, well, we cannot afford it. We got 
to keep the enterprise going. 

It is a question in my mind, but I don't consider 
it to be my business. I will do what I have to do. 
BY MR. NIELDS: 

Q I want you to continue, but before you do, were you 
present during these conversations in which North asked for 
money to be spent for the contras and Secord refused? 

A I don't really recall. I am not — in this 
context, I am not focusing on that. But I am talking about my 

knowledge of things [j^ J)[A3SlFlED 

Z ^ I really didn't come to get to know or even meet 

Oliver North until this February meeting m Frankfurt, so 



409 



MASSIflEO 



I was not present in any previous meeting prior to that; I 
did not even know of North until I met him in Germany. 

So if you will be patient with me and leavethat 
for a different line of questioning, I can — I am trying to 
find a common understanding here so we would not waste 
time and god forbid put myself in a situation that the Members 
present here would think that I am trying to contradict 
myself. 

I am trying to say that I could be truthful and I 
could answer the questions and yet they might be contradictory 
because the whole structure put together was in a very 
unconventional way. 

Here I aia told this is a private organization and I 
learn now that they structured it in such a way that the 
Government had to have participation in it and then the Governmeo 
was not supposed to have participation in it. 

We were supposed to keep the interests of the 
Government in mind and then we were supposed to go around the 
Government. You know, these issues did cross my mind, but 
I told myself, Albert, you got this General more than half-a- 
century old — please never tell him that; he is very 
sensitive to his age — he has been with the Government so 
many years, he has been involved in such sensitive projects, 
who are you to question this? Either you trust Richard or you 
don't trust Richard. 



UNCIASSIHED 



410 



m 



mmm 



10 



If I would not have trusted Richard, I guarantee you 
for no money in the world I would have participated in this 
activity because I can make money by spending less effort 
than I have spent in this covert activity. 

But I got into this for a lot of motivations and I 
differentiate between motivation and reward. I v.ould 
like you to go on the record with that. I hope time would 
allow so I can describe this issue. 

So I am left still with all these questions in my 
mind outstanding, Mr. Nields. So when you ask me whose 
money is this, what I could do with it, I am sorry, I have 
to give you a Jewish answer and that is to ask you a question 
instead of answering your question. Being a Jew, you know, 
I can afford doing that. 

So my question is, you are asking me whose money was 
this. I am asking you, whose enterprise was that? Was it a 
private enterprise? Was it Government enterprise? Was it a 
joint venture? 

If it was a joint venture, where are the documents 
describing the relationship? Who were the people who were 
supposed to control the activities? 

Why didn't they control the activities? Why did 
they let me go — you know, nothing was done in bad faith 
in my operation, I guarantee you. Nothing was done in bad 
faith in CSF's operation. 



UNCLASSIFIED 



411 



UNCLASSIFIED 



11 



I guarantee the honesty of all the people that I 
brought into this. But you know, trust is one thing, 
control is another thing. 

The thing started, with all due respect, in a sloppy 
manner, and got sloppier as we went into this and now 
here after the facts I am sitting in front of you and you want 
me to go back and analyze all these events and be precise in 
my answer to your very important question. 

I try to give you as many answers as I can, but I 
want to warn you that they may sound contradictory, that is 
not my intention, I am trying my darnedest, like I said 
yesterday and the day before, to help you as part of your 
team. 

I am looking at this as a team effort. So we can 
get to the bottom of this thing quickly so we can get on with 
our life. I am a bottom line man. I have to go there and 
do business. 

Here I am not making any money spending my time 
testifying. 

So I have again financial motivation to get to the 
bottom of this thing as quickly as possible. 

I want to make sure that you all understand all these 
outstanding important questions in my mind and I am afraid 
when you sum up all the various answers that I will be giving 
you if you would continue to trust what I am telling you. 



UNCLASSIFIFn 



412 



wmm 



12 



you would end up with one answer — I don't know. 

Q That was the answer I was taking you to give. 

I take it that that is the answer to the question 
whose money was this surplus? 

A I don't think that is a right question to ask, 
Mr. Nields. I don't think there is one answer to that 
question. I don't think there is going to be a situation 
that. you can classify things in the form of black and white. 
There are going to be a lot of grey areas. I believe that this 
bad architectural work that was done from the conception of 
this thing — 

Q Your first speech was very helpful and I don't want 
to stop you from making another one, but I don't want to hear 
the same speech again. I take it the bottom line is, your 
answer is, as you said, you don't know? 

A I don't know. 

Q All right. 

A It is not — 

Q Did anyone ever tell you — 

A — whose money this was? 

Q Yes. 

A My understanding was that this money belonged to 
our private enterprise. That was my understanding. That was 
what I was told at the beginning, that is what I continued to 
assume. Today I am confused. 



«!!CilSS!nEfl 



413 



UNCIASSIHED 



13 



1 

2 

3 

4 

5 
6 
7 
8 
9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 



24 G' 

UNClASSttlEir 



Q who told you that? 
A General Secord. 

Q Did you ever talk with Oliver North about it? 
A I did not get to know Oliver North as I testified 
earlier until the Frankfurt meeting and I did not become 
close to Oliver North until we got into the second channel, 
so my involvement with Oliver North really in a substantial 
way did not occur until September and on into October. 

It was a short encounter but very — but under 
intense environment. We became extremely close. I had to learr 
about him because he effectively was my client and 
eo. the other hand the Iranians, so I had to learn about him 
as quickly as possible. 

so the bottom line is I don't recall having had 
such a discussion with Mr. North. 

Q You have said that in some ways you were told and you 
understood that this enterprise was private to get around the 
Government, and in other ways it was responding to the 
direction of the Government. 

A That is my interpretation of it. It is not that 
they came and told me, Albert, we want to get around the 
Government and therefore we have architected this activity. 

That was my understanding, that is the U.S. 
Government is employing the services of the private organizat.o, 
ivate individuals to perform a covert activity. 



414 



mmm 



14 



Q What was your understanding of the reason why the 
United States Government chose to employ a private organization 
to perform this covert activity? 

A What was my understanding? 

Q Well, were you told the reason? 

A I cannot recall ever it was told to me in a clear 
way, but I took it for granted that they could not do it 
through their normal channels. They had not succeeded to do 
it through their normal channels and they needed the help of the 
private sector and this was not unusual for me. I have seen 
signs of that in the past. 

I really didn't focus very much on that. I heavily 
relied on General Secord to understand the U.S. Government. 
I don't consider myself an expert in the subject. I left 
all that very much to him. 

Q What was your understanding of the things which a 
private enterprise could do that the Government had not been 
able to do? 

A In connection with the contras, my understanding 
was that the U.S. Government could not support the contras, 
but private individuals could. 

Q You mean they couldn't do it legally? 

A Well, of course, yes, I taXe it for granted that 
the U.S. Government would not do anything illegally as a 



government body. I 



OHSiSsina 



415 



UNcussm 



IS 



So that, yes, is what I am saying, that the laws were 
such that it did not allow them to do what the President 
wanted to do. 

Q Okay. How about with respect to Iran? 

A My understanding with regard to the Iranian affair 
was a little bit different. My understanding waanot that the 
government wanted to go around any part of its structure. 
My understanding was that it was important for them to establish 
relationship with Iran and I very much subscribed to that 
policy, and I am also personally aware that there was no policy 
with regard to establishing a relationship with Iran and the 
reason I am aware is because I did try prior to my involvement 
with this re-establishment of relationships, many years before 
that, I approached the son of that Shah of Iran and I spent a 
lot of time, money and effort to see if I could sort of 
bring him around to get close to the U.S. Government so we 
could do something about Iran and this goes back maybe a year 
or two after the revolution and as a result of that activity 
I learned in more than one way that the policy, foreign 
policy was not to have a policy. So my understanding with 
regard to the Iranian initiative was that taking everything 
into consideration, including the situation in Iran, by 
the situation in Iran, meaning that there were a number of 
factions, the information about the movement of the Soviet 
Union, the apfMaLKfKft ttiA Alft#\lLpC|) be made from various 



^,'L^V*Jii 



416 



UNCLASSIFIED 



16 



' . - i . ■ • , • 25 ■ yob" t 



U.S. Government officials and ex-officials, that slowly 
there was a desire on the part of this Administration to do 
something about this and the best way to approach this was not 
to get Iranians panicky with them not having trust in us and us 
not having trust in them, try to start with this in a low key 
manner to see where it ends. 

That was my understanding. 
Q Why was a commercial cut-out important in doing that? 
A What is my opinion? 

Q First of all, were you told anything at the time? 
A No, it sort of — one thing led into another. 
When I say one thing led into another, we are here doing the 
contra thing and all of a sudden I am called, "Albert, your 
help is needed, be there in less than 24 hours." 

I happened to be in Geneva — "I will tell you what 
it is when you get here. I cannot talk about it." 

I get there. They tell me I have to all of a 
sudden become the President's interpreter. 

MR. LIMAN: Could we stop for a moment on this 
because, for the record, I think that it is critical. 

Mr. Hakim, I know, is not a professional witness, 
but it is important to differentiate between what is an 
understanding, which you can get from any number of ways, 
and what you were told. So when Mr. Nields says what were 



■ yob"told, you know, the answer is I was told this, or I wasn't 



417 



UNClASSra 



17 



told anything, or I don't remember, because when we get to 
general understandings, I am concerned that they can be 
grossly unfair to people in that they can be your interpretation 
not intended by a particular individual, but to the listener. 
I am sitting now away from John listening very carefully. 

To the listener, it can sound as if you were 
told something. So I do think that -- you know, we don ' tjhave 
a judge here, there is no judge in the hearings either, but 
it is important to listen to John's question and when he asked 
were you told something, to try to answer it directly. 
MR. JANIS: Just a moment. 
(Witness confers with his lawyer.) 
MR. JANIS: Okay. 

THE WITNESS: Mr. Liman, I appreciate your 
explaining to roe. I understand. 

Mr. Nields, could you please repeat your question 
so I will try to answer the question in a manner that is -- 
BY MR. NIELDS: 
Q My question is what were you told, if anything, 
about the reason for using a commercial cut-out in the Iranian 
transactions? 

A I don't recall that I was told anything at the 
early stages of my involvement. 

Q Were you told something about the" reason Tor using 
a commercial cut-out on the Iranian transactions at a later 



UNCIASSIHED 



418 



18 



time? 

A Yes. 



UNCLASSIFIED 



Q When? 

A When I was requested to open a second channel. 

Who told you? 

A General Secord. 

Q And anyone else? 

A He started it. There were a lot of follow-up 
phone calls by Oliver North. 

Q What did General Secord tell you? 

A That my, Albert's assessment, was correct, and the 
Ghorbanifar channel was not getting where they wanted it to 
get. They had a lot of disappointment and without — I 
underline this was repeatedly discussed and made known to me, 
that without losing the first channel they wanted to create a 
second channel, test it, make sure it is viaUsle and reliable 
before they abandoned the first channel. 

Q What were you told, if anything, on the subject of 
why a comnercial cut-out was being used? 

A That was not even an issue. I was told nothing. 

Q So at no time were you told why a commercial cut-out 
was used in connection with the Iranian transactions? 

A The — in the light of what Mr. Liman explained, 
the answer is no one told me] 

MR. LIMAN: John, a*ift.l^"S6#TdW ^^e" ^Tbnd? 




419 



1 

2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
end BOYUM 25 



UNCLASSIRED 



19-30 



MR. NIELDS: Sure. 
(Discussion off the record.) 
BY MR. NIELDS: 
Q Where were we? Do I have a question pending? 

MR. WECHSLER: I believe you asked the question, 
so you were told nothing, and he agreed. 

THE WITNESS: I think I answered your question. 
MR. LIMAN: I waited for the answer and then 
interrupted. 

MR. NIELDS: Okay. Fine. 
BY MR. NIELDS: 
Q What were you told about why you were being used — 
you and your Swiss accounts? 

A I am afraid I don't understand the question. 

You are still on the Iran initiative? 
Q Yes, on the Iramian transaction. 

A On the Iranian tramsaction and the question is why I 
was used as — I was not told that either. 

MR. JANIS: Can I have a moment here? 
(Witness conferring with his lawyer.) 
MR. JANIS: Csm we take a minute here? 
MR. NIELDS: Sure. 

MR. JANIS: I mean the three of us? 
(Discussion off the record.) 



UNCIASSIHED 



420 



«2 

CANTOR /md 
fls BOYUM 
2:00 p.m. 



yNCUSSinEO 



31 



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 WITNESS: I understand why we are having these 
miscoitununications . 

BY MR. NIELDS: 

Q Let me just ask you some other questions, if I may. 
The Iranians I guess represented by Ghorbanifar paid the 
money for these arms sales into Lake Resources? 

A Yes. 

Q Now, there was, I take it, a CIA account in 
Switzerland, and my question to you is if you know, why didn't 
the Iranians simply put the money into the CIA? 

A I don't know. 

Q Did you ever talk to anyone about why it was that a 
private party with a private bank account in Switzerland 
was used to receive the purchaseprice for these Iranian 
arms? 

A I don't recall such discussion. 

Q The record is clear. You don't recall any 
discussion as to why it was that your Lake Resources account 
was used to receive the monies rather than the CIA account? 

A That is correct. 

Q What was your understanding? 

Let me ask you even a simpler question. Did you 
have an understanding as to why your system of bank accounts 
was being used to receive the money? 

A The best way to answer that^is 'CT 




421 



UNCUSSIFIED 



32 



1 speculation. I speculated why all of this was happening, 

2 and my speculation also was in line with my logic, and also 

3 with my philosophy towards dealing with Iran, and that 

4 speculation was only through business channels can you 

5 penetrate into the Iranian system. 

6 Q You have repeatedly characterized the transaction, 

7 the transaction as covert. 

8 A Yes. 

9 Q And you have also explained to us the manner in which 

10 you used the various bank accounts for confusion purposes? 

11 A Yes. 

12 Q Now, wouldn't it be fair to say that it was your 

13 understanding tha+'one of the reasons Lake Resources and 

14 your accounts were being used wfasve in order to make it 

15 more covert? 

16 A That is a reasonable conclusion. 

17 Q In other words, it would increase the difficulty 

18 for someone to detect what was going on in these transactions? 

19 A Without a shadow of a doubt. 

20 Q And that that was your understanding as one of the 

21 reasons why your Swiss bank accounts were being used? 

22 A By then it had become part of my life. It was a fact 

23 I never questioned it any more in my mind. 

24 MR. JANIS: What is the answer to his qu^s_tion? 

25 THE WITNESS: Yes. 




422 



33 



yNCUSSlHED 



1 BY MR. NIELDS: 

2 Q Here is the second question I want to ask. What was 

3 your understanding of why, in using your bank accounts in 

* furtherance of making the transaction covert, why there was 

5 left so much money in your bank ac-ounts? 

6 A Your question is, if I was told or what was — 

7 Q The first question is, why you were told. Let me 

8 sharpen the question. $25 million came in, maybe 1.5 were paid 

9 out in expenses, why wasn't all the rest put in the CIA 

10 account? First tell me if you were told the reason, and if the 

11 answer is no, please say so. 

12 A I don't believe the answer is no, because I recall 

13 statement, most probably from General Secord, possibly also 

1^ from Oliver North. I cannot be certain about that, that it was 

15 going to be a source of income for the contra effort . 

16 Q Here any other reasons given to you? 

17 A Not that I can recall. 

18 Q Here you ever told that one of the reasons was so th4 

19 you or Mr. Secord could profit personally? 

20 A At a certain point in time, yes. 

21 Q Who told you that? 

22 A Mr. Secord. 

23 Q When? 

24 A When I became more involved in the activity. 

25 Q That is in the second channel? 



ONCLASSinED 



423 



iii^iUSSIHED 



34 



1 A No, even prior to that, I did perform other functions 

2 in the first channel, nothing substantial, outside of the 

3 very important first meeting in Frankfurt, but the issue was 

4 discussed at one point there would be also profit to us. 

5 Q I want to make sure first I understand at what 

6 point. 

7 MR. JANIS: At what point was it discussed? 

8 BY MR. NIELDS: 

9 Q Yes. At what point was there discussion? 

10 A I believe towards the end of the life of the first 

11 channel, so that brings it to I would say sometime around 

12 August of 1986. 

13 Q You discussed this with General Secord? 

14 A Yes. 

15 Q Did you discuss it with anyone else? 

16 A In that time period, no. In September, yes. 

17 Q Who did you discuss it with in September? 

18 A I discussed that in a meeting where the Iranian 

19 representatives were present. General Secord was present, 

20 George Cave was present, obviously I was present, and I discuss^, 

21 that openly with all of them. 

22 Q Was Oliver North present? 

23 A Yes. George Cave was present, and if I remember 

24 correctly, as a matter of practice, Oliver North always carried 

25 his briefcase that was equipped to record the discussions tf 



UNCIASSIHED 



424 



35 



UNClASSra 



1 of the meetings that he wanted to record, so I would be 

2 surprised if there is no such tape. I understand the 

3 impression that the whole series of discussions we had, and 

4 I remember it was a Saturday, because this took place in 

5 the offices of Stanford Technology Corporation in Vienna, in 

6 our conference room there, and so, I believe there should be 

7 a recording of that meeting. I was told — 

8 Q Did you discuss this subject at any other 

9 occasions that you can recall? 

10 A Yes. The subject was discussed in almost every 

11 meeting that we had that both the representativeaof the Iranian 

12 Government and the U.S. Government were present, because I had 

13 people who had assisted me. 

14 The reason it came up all the time, Mr. Nields, was 

15 because I was under pressure by a number of people that had 

16 helped me to open the second channel. For them, they wanted 

17 to know where they were standing financially with regard to 

18 this, and so I had to bring the subject up at every meeting, 

19 and in every meeting I was promised by both groups that they 

20 recognized that I am in this for financial benefit, and they 

21 will deal with this at a later date, and that was sufficient 

22 for me, esepcially when the Iranians also confirmed that this 

23 is quite common 

24 It is not the case at all, but very usual that when 

25 you get involved in a transaction that all parameters are not 



UNCLASSIFIED 



425 



ONCLASSIFIED 



36 



know^ you leave it for the times that things arebcnown. You deaj 
basically in trust, and settle things up when the issues are 
more tangible, so I was promised that this issue would be 
dealt with. 

I communicated that to the other people who had 
interest in this venture. I kept them quiet, but they 
continuously badgered me with where they stood. I came back 
to -- each meeting was repeated. 

Q I jumped ahead of myself. I want to get back to 
this in greater detail, but you said you had a conversation 
with Secord in August on this subject, and you have not yet 
described that conversation. 

Why don't you describe that conversation? 

A I have to back up. I am reconstructing the events 
in my mind. I have to back up maybe a month. There was a lot 
of effort on my part during the month of July to arrange 
the meeting between what turned out to become a second 
channel, and the American group, and we had difficulties in 
coordinating the meeting because of the Oliver North 
schedule. 

He had a very tight schedule, and he wanted to participate 
in this evaluation meeting, I referred to it as an evaluation 
meeting . 

MR. JANIS: Excuse me. 



(Witness conferred with counsel.) 



ilUSSIflED 



426 



37 






1 BY MR. NIELDS: 

2 Q The Brussels meeting is sometime August 2Qth. 

3 MR. JANIS. Just for the record, while we were off 

4 the record, Mr. Hakim was trying to reconstruct events in his 

5 mind so he could be as accurate as possible. Mr. Nields, 

6 I think as I recall the question outstanding was what was 

7 the substance of the first conversation he had with General 

8 Secord regarding payments; is that correct? 

9 BY MR. NIELDS: 

10 Q Yes. 

11 A I think that it was early August when I discussed 

12 the subject of financial participation in the Iranian initiativ 

13 with General Secord, and General Secord 's response was that 

14 if he were going to be successful to make a smooth transition 

15 from the first channel into the second channel, we can benefit 

16 from the total initiative. 

17 Q What did you understand that to meem, that you could 

18 benefit from the total initiative? 

19 A I understood it to be one project that was going back 

20 and if you could come in and cure this and make this good, then 

21 we were going to be entitled to the benefits derived from the 

22 total effort, total project. 

\ 

23 Q Does that mean including the benefits that had alread 



yHCLASSIRED 



24 been derived? 

25 A I didn't focus on it in that manner. 



427 



38 



UNCUSSIHED 



1 Q I am not sure I am understanding you, Mr. Hakim. Are 

2 you saying that what Mr. Secord said to you in substance was 

3 simply that if you were successful in developing a second 

4 channel, there would be something in it for you financially? 

5 A Effectively, we would be replacing Chorbanifar, 

6 and we are going to be the people that are going to go in bot>f i 

7 the two governments. That was my understanding, and we are 

8 going to benefit from the venture. 

9 EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 

10 BY MR. LIMAN: 

11 Q Who is the we? 

12 A Richard and I. 

13 EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 

14 BY MR. NIELDS: 

15 Q Did he indicate to you at all in what way or in 

16 what amounts you were to benefit? 

17 A No. It was very vague. 

18 Q Simply that there would be something in it for you 

19 financially? 

20 A Yes. 

21 Q And something in it for him? 

22 A I might as well put this thing to rest once and for 

23 all. My understanding at all times was that I was not, or at 

24 least in my mind, I never separated myself from my partner. 
Q Your partner being Secord? 



25 



ilSLASSIRED 



428 



20 
21 
22 
23 



UNCUSSIHED 



39 



A Secord. As a result of my culture, my 

2 association, all these things, in my mind — 

3 Q You were 50-50 on all these transactions? 

* A That was my interpretation of things , and that was 

5 my understanding at all tinies. 

^ Q Was anything further said during this conversation 

^ in August with Mr. Secord? 

8 A Not that I can recall. 

^ Q I interrupted you as you were describing the 

various conversations that you had in joint meetings with the 
Iranians, North and Secord, and Cave. Could you just tell us 
again what was said on the subject of your financial 
remuneration? 

A The way this thing worked out, the other individuals 
that had helped to open the second channel , they managed 
to come to the places that we held our meetings, but not 



^^ staying with us or participating in the meetings, but being 

18 

19 



present in that city, and at the end of each official meeting 
that I participated, in the evenings I was question*, what is 
happening to us? They wanted to know if in the discussions 
we had reached agreement clarifying their position, and this •* 
not done. This was discussed in Frankfurt during a couple of 
three meetings that we had there, I don't remember how many 



2^ meetings. 



25 



DNCUSSIHED 



I believe there was a meeting in Meintz, if I am 



429 



UNCLASSIFIED 



40 



1 correct, Germany, or a city similar to that. We had meetings 

2 also in Geneva, but I don't recall whether the issue of money 

3 was discussed then or not. I cannot recall that, because I 

4 don't remeriber those associates of mine being in Geneva, 

5 but it w=s an outstanding issue, and each time I had people 

6 sitting and waiting for me to come up with some sort of an 

7 answer as to when, how much, how they are going to be 

8 compensated, and I tell you, these people are not people that 

9 one likes to fool around with, so I tried to get an answer 

10 from the two members. 

11 I felt uncomfortable. These are representatives of 

12 two countries sitting there trying to establish this very 

13 important relationship, and I had enough imagination and 

14 self-confidence that somewhere along the line, in the future, 

15 I would be making a bundle of money, but at the same time, I am 

16 being harrassed by these people, and I have to come in and 

17 I cannot tell especially the Americans, "Hey, guys, my life is 

18 at stake. Come on, tell me." 

19 Q I want to make sure I understand this picture 

20 correctly. The people you say who were not at the meetings 

21 were people, private citizens, who were helping you establish 

22 the second channel, is that it? 

23 A I would best say that private citizens were involved 

24 in there, too. 

25 Q There were private citizens and other people who were 



La oes^ say tnat private < 

UNCLASSra 



430 



ONCLASSIFIED 



41 



not Americans who had helped you establish the second channel. 
2 A And who could possibly -- 
Q Is that correct; 
A Yes. 
^ Q And they told you they darn well wanted to be 
^ compensated if the transactions went through: 

A To put it lightly. 
^ Q And in meetings with officials of the United 
^ States Goverment and the Iranian Government, you told both of 
them that you needed to be compensated in some satisfactory 
fashion. 

A It got to a point that it was beyond that. That was 
understood, and they all agreed. The question was how much, 
^* when and how. 
^^ Q What was said on the subject of how much? First, 

let's just establish who these representatives were, at least 
from the American side. Is that Mr. Cave and Mr. North? 

A And, you know, we were taking into consideration 
my earlier explanation cibout the enterprise, I would like to 
also include General Secord in there. I want to go on the 
record here with all due respect, and I mean this sincerely, 
my guarantor for all these things was Richard Secord. That 
was the only guy that I could rely on to make these promises 
good. 

u. 

I did not ever find myself in a position that I coul 






431 



UNCIASSIRED 



42 



1 go with an invoice in my hands to NSC and say, gentlemen, 

2 you owe me this much. I never had that understanding. 

3 Q So, you wanted Mr. Secord's commitment, and you 

4 also wanted this raised in the presence of Mr. North and 

5 Mr. Cave? 

6 A Yes, and the Iranians. 

7 Q And the Iranians, and you raised the subject in the 

8 presence of all of these people, and they agreed that you would 

9 be compensated in some way? 

10 A Yes. 

11 Q Then you raised the subject of exactly how, when and 

12 how much? 

13 A Right. 

14 Q What was said on that subject? 

15 A It was left to further developments of the 

16 relationship. We were going through a very, very difficult 

17 and intense time. We really were. I could understand why 

18 they could not give me an answer. I was very sensitive to 

19 that. I was involved in the discussions. 

20 Q But I want to make sure that — it was left uncertai 

21 but you were told that one way or another, you would be 

22 compensated in a way satisfactory to you and the people sittin 

" —' UPlASSinED . , , , 

24 A Exactly, Dut you must recognize the time frame m aJ 

25 this. All these are happening in the time frame of October- 



432 



10 



43 



UNCLASSIRED 



■• November. 

2 Q Understood. 

3 A And partially in September. 

* Q I take it you were aware that there was to be a 

5 difference between the price paid by the Iranians into 

6 your Swiss bank accounts and the price that would be paid out 

7 of your Swiss bank accounts to the CIA? 

8 A Yes. 

9 Q And I take it it was not said during those meetings 
that you will be compensated by being able to keep this 

I! difference? 

12 A I don't recall such a discussion at all. 

13 Q Would it be fair to say, then, that it was not 

1* clear during those discussions that that difference would beloi 

15 to you? 

16 A That would be fair, 

17 Q And I take it by reason of the fact that you 

18 explicitly discussed the subject of compensation for you with 

19 Mr. Secord in August, that it was not your collective 

20 understanding previously that the $17 million differential 

21 on the first two transadtions was to go to your personal 

22 benefit or his? 

23 A That is fair. 

24 Q Did you ever discuss any reason for this $17 
million differential, other than use for the contras or use 



icussra 



25 



433 




..Hrl?i 



1 

2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 



5& 



^ 






22 



25 



for your personal benefit? 
A Expenses. 
Q Anything else? 

A The issue of self-insuranae came about sometimes. 
I can't recall the exact presentation of this thing, but 
the bottom line was that Richard said that you never know what 
Ollie would need next. 

Q And I take it at one point Ollie needed a ship and 
you used the money to buy a ship? 
A Ves. 

Q And at one point, Ollie needed Motorola radios and 
you used the money to buy Motorola radios? 
A Yes. 

Q And I take it at one point, he wanted some money 
for DEA agents in cash, and you used it for that purpose? 

A Well, I don't know whether he initiated that. 
Richard told me that such-and-such people will come to you 
and give him so much. 

Q But it wouldn't come as a surprise to you to learn 
that that also was originated by Ollie North? 
A I would be surprised if it didn't. 
Q And so, is it fair to say that it was your 
understanding North wanted the money used for the contras , 
he wanted the money used for the boat, he had money used 
for Motorola radios, money used for the DEA and of course,"^ 



434 



mmvm 



45 



1 

2 
3 
4 
5 
6 
7 
8 
9 

10 
11 
12 
13 
14 
IS 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



he needed to use it on expenses for Iran and 
for the reserve insurance. 

Is it fair to say it was your understanding that 
during that period of time, that this differential, surplus, 
profit, whatever we call it, was being used and was to be 
used at North's direction? 

A This is what I tried to explain earlier. 
Everything that you mentioned are the examples of these 
contradictions, yes. 

Q Is the answer yes? 

A Yes. 

Q Was there ever any discussion with Secord or North 
to the effect that North affirmatively wanted a pool of money 
available to him in Switzerland for any use that might arise? 

A I understood -- 

MR. JANIS: You are asking him if he was privy 
to any such conversations or if he was told of any such 
conversations ? 

MR. NIELDS: Both. 



UNCUSSinED 



435 



CANTOR :mhl 
fls md 



UNCLASSIFIED 



46 



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 



BY MR. NIELDS: 
Q Let's do first whether he participated — I am 
really asking whether that was ever told to him either by 
North directly, by Secord, or by anybody else? 



A The answer is yes, it was told to me by Secord. 
Q I am going to move tc another topic. 
MR. LIMAN: What was he told? 
BY MR. NIELDS: 
Q Yes, what exactly were you told? 

A That we need to stand on our own feet. It has to 
be a self-sustained enterprise. We cannot rely on any other 
income, so we have to build up a financial backbone. 

Q And what did he say on the subject of the financial 
backbone being there because North wanted some money available 
to him for whatever needs might arise? 
A Also. 
Q He said that? 

A Yes. Not in that meeting, but you know, when you 
add this up, and I am sitting here in front of you today, 
when you pa^^ge it, the answer is yes. 

MR. JANIS: What he wants to know is as specifically 
as you can recall, did Mr. Secord ever tell you that North 
told him that he wanted a pool of money available for North 
to be able to use for whatever purposes he wanted? 

THE WITNESS: Not for whatever he wanted, but it 
was very definite about che contras. 



UNCUSSIHED 



436 



1 

2 
3 

4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 



20 
21 
22 
23 
24 
25 



UNCLASSIFIED 



47 



MR. JANIS: So the answer is yes, Secord told you 
North had told him he wanted nxaney to be available in a pool 
to use for the contras? 

THE WITNESS: Yes. 
BY MR. NIELDS: 

Q Th: next question is did he ever go further and 
say that North wanted a pool of money available for whatever 
needs might arise? 

A You know, I have to refer to my earlier answer. 

Q It was used for those — 

A It was known to me that North may have other needs. 
It was not an outstanding issue that needed to be clarified. 

Q So, what Secord told you in effect was affirmativel 
that North wanted money available for the contras, and then 
he said at some point or another there is no telling what 
else North may want to use money for, is that correct? 

A I testified to that earlier. That is correct. 



^^ MR. LIMAN: John, has he defined what enterprise 

^® is as he uses that term? I wasn't here the first day, but 
19 



I have heard the term "enterprise" yesterday. I heard it 
again today. 

MR. JANIS: As I recall, the first day we got into 
that as a system of compamies that he made available, ^ut 
if you need to go over it again -- 

THE WITNESS: I think we went into that quite 
heavily, and even referred to the chart, explained the purpose 



at he made availanie, out 

UNCLASSIFIED 



437 



mmm 



48 



of it 

1 MR. LIMAN: 

2 I know the entities that make it up, but you use 

3 the enterprise in the sense of a group of companies that have 

4 a particular objective. 

5 MR. JANIS: I think the enterprise has entered the 

6 English language in a colloquy which all senses — 

7 MR. NIELDS: I take it this is a term he may not 

8 have used at the time but is using it now after listening 

9 to Mr. Secord's testimony. 

10 MR. JANIS: I think everybody in the country is 

11 using it now. 

12 THE WITNESS: The answer to your question, Mr. 

13 Nields, is yes. I have no other terminology to use to 

14 describe this strange animal. 

15 BY MR. NIELDS; 

16 Q This wasn't a term that North used in your presence 

17 
18 

19 asked a lot of questions, as a businessman. They didn't use 

20 it. They were not specific. 

21 Q When we broke yesterday , or maybe not when we broke 
yesterday — Arthur, has this been satisfied? I think it is 
covered — when we broke, or sometime yesterday, I asked you 
to take Vhome the ledger. Not the ledger, not the full 

the ledger which has been marked 



A I don't think even Secord used it in the past. If 
anybody would have used the name in the past, I ^ijuld have 



iiMA?!li?rn 



438 



UNCIASSIHED 



49 



Deposition Exhibit 1, to see if you couldn't review it, that 

1 you could put yourself in a position to tell us what various 

2 enterprises in the ledger represent, and I would like to turn 

3 to that now and I put in front of you a copy of Exhibit 1, and 

4 I would like to begin with the page headed Albert Hakim, which 

5 is page h. 964 . 

6 A I approach it the same way, Mr. Nields, skip over 

7 the first four or five pages, and started to try to analyze 

8 as much as I could these figures. 

9 Q I would like to just go through them items by item, 

10 and have you tell us what you can about each item. The first 

11 one is a February 18, 1985 cash withdrawal in the amount of 

12 $5,000. What does that represent? 

13 MR. JANIS: Can we, as ground rules, I think it 

14 would be easier, I assume that you want him to testify whether 

15 he knows or even if he can speculate, is that correct? If he 

16 can specualte you want him to do that too? 

17 MR. NIELDS: I want him to do both, but I want him 

18 to clearly state which he is doing. 

19 MR. JANIS: Okay. 

20 THE WITNESS: Item 1, I don't know. My speculation 

21 is that it could be, judging from the amount, it could be cash 

22 that I withdrew to serve the purposes of the expenditures of 

23 the enterprise private, or STTGI. It is possible for the use 

24 of all of those. 



25 



BHaftssm 



439 



UNCLASSIFIED 



BY MR. NIELDS; 




50 



Q I am notqoiing to mark this, but I am going to put 
something in front of you and see whether it refreshes your 
memory. 

MR. JANIS: Just for the record, this is document 
H. 411. 

MR. NIELDS: Both H. 11 and H. 411. But I think 
you are correct, we should use the H. 411. It is a basic 
record that was made available by Mr. Hakim to the committee 
in Paris. 

MR. JANIS 5 Let's go off the record. 
(Off the record discussion) 
BY MR. NIELDS: 
Q Mr. Hakim. I take it with respect to this first 
transaction, February 18, 1985, $5,000, you believe that it 
is either an expense of the enterprise or it is a personal 
payment to you, or for the benefit of STTGI, and you can't — 
A Or a combination. 

Q Or a combination of them, and you cem't tell which? 
A That is correct. 

Q Did that money leave the enterprise and CSF, or 
is it on deposit invested by eS6? 

MR. JANIS: If you know. 
^«^ THE WITNESS: I have no idea. 

lV\/ MR. JANIS: Just for the record, the document that 
Mr. Nields just showed us would indicate that on the same 



440 



ONCUissra 



51 



date, $5,000 was transferred from Energy Resources to CSr 

1 Investments Limited, and again that is the same date of the 

2 cash withdrawal. Whether that means it was an operational 

3 expense, I guess he has no recollection. 

4 THE WITNESS: Or the capability to even speculate 

5 about the transaction between CSF — 

6 BY MR. NIELDS: 

7 Q I just want to make sure I understand that, because 

8 this document that I showed you, H. 411, shows it going to 

9 ."^PF - Would that indicate that it was invested by CSF rather 

10 than being a cash dis^rsement to you? 

11 A I have no idea. I don't know. 

12 MR. JANIS: I think what he is saying is that there 

13 are occasions when I suspect many occasions, when CSF 

14 Investments may indicate a cash withdrawal to Mr. Hakim when 

15 it may have been for cin operational pupji|ose, and not for a 

16 personal purpose, and the CSFV accounts may have been used 

17 that way. Is that correct? 

ia THE WITNESS: What I am trying to say, I don't knov 

19 exactly what sort of an arrangement CSF had with expenses, 

20 even in connection with our accounts, and I am not aware of 

21 the meaning of this sort of transaction. The only thing I se« 

22 in common between what I have in the ledger and this document 

23 is the date. 

24 BY MR. NIELDS: 

25 Q The amount. 



UNCUSSIFIED 



441 



UNCUSSinED 



52 




1 

2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
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18 
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20 
21 
22 
23 



A The amount is $5,000 here, and there is $5,2152. 
Q Wouldn't that be the bank charge? 
A Could be, I don't know. YOu see, there is a 
separate entry says $1.52. Is that bank charge? Why is it 
5.20? That is what I don't understand. 

Q What I am trying to get at is this. If this were 
an expense of the enterprise, would it be transferred to CSFV, 
or would it be transferred somewhere else? 

A I don't know. If I wanted cash I would tell CSF 
and they woulc^ake it available to me. How they did it, I 
don't know. 

MR. JANIS: Let me have a moment. 
(Counsel conferring with witness) 
BY MR. NIELDS: 
Q The second item is a $3,000 item for April 18, 1985 
What does that represent? 

A That is personal for me. 

Q That is not an expense of the enterprise? 
A No, it is not. 

Q The $5,000 transaction, what does this represent? 
A If you go further down, since I studied this page 
carefully, if you go further down on the 17th, you see it 
says funds returned unpaid for the same amount. 

Q It doesn't look like the same amount to me. 
A Sorry, I am making a mistake. Let me explain to 
What I me:.nt, if you go down to the 17th to the $45,000 



442 



UNCUSSIHED 



53 



1 



amount — there is a $45,000 amount transferred to Bank of 

^ Korea, 18th. Do you see the $45,000? 

2 MR. NIELDS: Let's go off the record. 

3 (Discussion off the record) 
BY MR. NIELDS: 

5 2 We are back to the June 16, $5,000 transaction. 

I take it that is personal? 
^ A That is personal. 

8 Q Then there is a February 20 transaction in the 

9 amount of $20,000. 
'0 A I don't know -feteffit that was. If you have any backup- 

11 documents that can help me, I would appreciate it. 

12 Q We do is the answer, but it will take me a second 

13 to find it. 

14 (Off the record) 

15 BY MR. NIELDS: 

16 Q Let's go back on the record. I put in front of you 

17 a document from the records you supplied us that has Bates 

18 stamped H. 409 on it. 

19 MR. JANIS: It indicates a cash withdrawl from 

20 Energy Resources payable to CSF per the orders of Republic 

21 National Bank. 

22 MR. NIELDS: Yes, and that is broken down $22 Korel 

23 $20 Hakim. 

24 (Off the record discussion)] 

25 MR. JANIS: We have also in front of us H. 1829, 



UNCLASSIFIED 



443 



end 
end 



1 

2 

3 

Cantor 4 
mhl 

S 



6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 



UNCLASSinED 



54-60 



which is another Energy Resource bank record. Is this from 
Credit Suisse? 

MR. NIELDS: Republic National. 

Mr. Janis. My question is this: This is not the 
same Energy Resource account. 



22 



23 



25 



UNtlASSra 



444 



Bun 2-24 
Boyum tape 3 
mkb 1 



uNcussra 



61 



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2 

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8 

9 

10 

11 

12 

13 

14 

IB 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



.A I cannot identify this handwriting. I can tell you 
it is not Bill Zucker's. 

MR. ZANARDI: This is the Secord portion of that 
amount going out. 

This is the 522,000 account going to Secord out of 
that portion. 

MR. VAN CLEVE: And he has a receipt for that. 

MR. NIELDS: Let's go back on the record. 

BY MR. NIELDS: 
Q Mr. HzJcim, we are going to change format a little 
bit and let you go through the items on this ledger and 
identify for us the ones that you can, and then we will come 
back and pick up the ones that you are uncertain on. 
A Okay, let's do that. 

There are a number of small cash withdrawals here on 
the 20th for $3,000 and the 25th for $3,000 and again — the 
25th is for $5,000 and twice on the 20th for $3,000. I have 
marked all these things to be under the same category that we 
had the first $5,000 and on the 18th, top of the page. 
Q Yes. 

A I would like to answer or identify these in the same 
manner that I have identified the $5,000, i.e., these could be 
operational expenses of the enterprise, private or STTGI or 
a combination of them. 

MR. JANIS: For the record, I also think on these 



i 



tne enterprise, private 

UNCUSSIFIED 



445 



UNCLASSIRED 



62 



1 small amounts I recall the records that we produced, there are 

2 a number of instances in which, even for the small amounts, 

3 there are back-up documents from CSF records indicating that 

4 the funds may be further disbursed or on some occasions for 

5 other purposes that they were disbursed. 

6 THE WITNESS: This transfer to Barclays Bank in 

7 California for $10,000, that is personal for me. 

8 MR. VAN CLEVE: Let me ask before you go on, did you 

9 mean to tell us or have you told us whether the notations were 
created contemporaneously, if you know? 

MR. JANIS: It is my understanding that the 
'2 notations on the back-up documents were created contempora- 
'* neously. 

'* THE WITNESS: The amount of $12,800 transferred to 

the Bank of America, because Bank of America was one of the 
banks that I used. 

I would like to see if you have the back-up 
document on that. I might be able to help you with that. 

MR. SABA: Here you go. 

THE WITNESS: Okay. I know what it is. 

MR. WECHSLER: Turn the document over to see if — 

THE WITNESS: I know what it is. 

MR. JANIS: Turn the page to the next one. 

THE WITNESS: Okay. 

MR. JANIS: For the record, Mr. Hakim was shown 



e page to the next one. 

UNCIASSIHED 



446 



UNCLASSIHED 



63 



1 documents H-20 and H-19. 

2 MR. WECHSLER: 18 and 19. 

3 MR. JANIS: He looked at the first two pages, 20 and 

4 19. 

5 THE WITNESS: Can I see that again? 

6 MR. ZANARDI : Sure. That is a copy of a check. 

7 THE WITNESS: I understand. 

8 This is a loan that I extended to my company, 

9 Stanford Technology, Inc. , in California. So for the purpose 

10 of your accounting, it should be charged as my personal draw. 

11 MR. NIELDS: Okay. 

12 THE WITNESS: There is a transfer to Albert Hakim 

13 for $50,000. 

14 BY MR. NIELDS: 
18 Q April 16? 

18 A April 16th. That is return back to the account. 

^7 If you come further down on the 17th of June, it says funds 

18 returned and paid for the saipe amount, $50,000. 
1* MR. NIELDS: Off the record for a moment. 

20 (Discussion off the record.) 

21 MR. NIELDS: Back on the record. 

22 THE WITNESS: Okay. This is — 

23 BY MR. NIELDS: 

2* Q Mr. HeJtim, r think you are now going to correct the 

28 einswer you previously gave on the $50,000 transaction on 



Kay. xnis is — 

IINCUSSIHED 



447 



17 



22 
23 
24 
28 



iiNcmssinED 



64 



1 April 16; is that correct? 

2 A Yes, sir. 

3 1 would like to leave that and come back to it when 

4 we have more back-up documents to look at. I don't know. It 

5 falls under the category of the items that I don't know. I 

6 mistook that for another $50,000, 

7 Q That transfer went to Chase Manhattan in Paris, 

8 Does that help refresh your memory on it? 

9 MR. JANIS: What was the date again? 

10 MR. NIELDS: April 16, 

11 MR. JANIS: Off the record for a second. 

12 (Discussion off the record.) 

13 THE WITNESS: That won't help me. 

14 BY MR. NIELDS: 
18 Q Keep going, then. 
1* A 18th, transfer to Robert Gooding, $37,000, 3730. 

That is personal. That is my attorney in San Francisco. 
1* 29th, $7,000, I again categorize that as a combinatioi 

'• of operations or one of them, expense. 
**' The next one, same thing, the $3,000. 

** Q Okay. 

A The 21st — . 

MR, JANIS: May 21st, 1985. 

THE WITNESS: Yes. 

If I can recall correctly -.- and I am basing my 



It, iSOD. 

UNCLASHD 



448 



WUSSIflfO 



65 



1 judgment on the amount of the $250,000 and the annotation 

2 here says that re-loan, re: lo loan, this was a transaction 

3 that CSF and I jointly entered into in a piece of property 

4 that apparently I found out later that CSF, too, has that as a 

5 loan, a piece of property we bought jointly, and it was 

e returned and I paid some interest on that and I cannot see 

7 where I was charged for the interest. 

8 This was the principal, I believe. So this needs 

9 further clarification. 

10 The principal could have been less and the 250 

11 includes the interest. But judging from — it says transfer 

12 to Compaigne de Services, Re: Locin — 

13 MR. JANIS: But it says Re: Lo. 

14 THE WITNESS: I read that to be "loan." 
IB BY MR. NIELOS: 

18 Q So that is a personal amount? 

17 A Yes. On those assumptions it is personal and there 

18 should be back-up documents. Such a transaction existed. 

19 The principal could have been $200,000 and the $50,000 

20 represents the interest, or the principal could have been 2 50 

21 and then there should be somewhere where they charged me for 

22 the interest. 

23 Q But this is $250,000 leaving the enterprise, going 

24 to your personal benefit? 

28 A With those assumptions, yes. 



ONCLASSIHED 



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5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

IB 

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18 

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20 

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24 

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UNCUSsm 



f .. Q All right. 

I should say, in case it affects your recollection, 

3 that it appears to have been transferred to Banc Nacional de 

4 Paris. 
MR. POINTS: You see that $250,000 reappear on the 

next page in '86. 

MR. WECHSLER: Did you say you paid back the loan? 

THE WITNESS: Yes. 

BY MR. NIELDS: 
Q Paid it back to where? To the enterprise? 
A To CSF. They are showing these things 
Q In other words, CSF had loaned money earlier and you 
paid them back with the 250? 
A With that 250, yes. 

MR. JANIS: CSF had loaned him money and he paid them 



back — 

MR. NIELDS: That is the payment back. 

THE WITNESS: I would like to make a correction here. 

If these — 

MR. JANIS: Incidentally — 

THE WITNESS: I need to make a correction first. 

- — o-v IJHCLASSIFIEB 

THE WITNESS: That I, just since we went through 
this mental exercise here, the $250,000 that I was referring 
to in connection with the purchase of property in San Jose 



23 



25 



450 



ONCUSSIflEtt 

1 was not paid back through the enterprise. That was paid from 

2 my account, because the property was sold in San Jose and I 

3 sent a check to CSF to their account in Republic — New York. 

4 So I would like the record to be corrected for that mistake 

5 of mine. 

6 BY MR. NIELDS: 

7 Q So what — I want to understand . 

8 A I am saying there was a previous loan and I am 

9 reading this "Re: Lo" to be "Re: Loan." 

10 MR. JANIS: You are reading this to be a payment 

11 back to CSF for the loan. 

12 THE WITNESS: Yes. 

13 MR. JANIS: Do you have a record from Republic 

14 National Bank that they got a check? 
IB MR. ZANARDI: Yes. 

16 MR. JANIS: What this transaction highlights about 

^7 this ledger emd one of the reasons it is confusing, assuming 

'6 this is correct, this was a trzmsfer to CSF and not a 

^' transfer into Mr. Hakim's capital account, which apparently 
is the case, if you look at that balance. The balance, 
even though it was payment to CSF from this account, the 



^2 balance goes up $250,000. 



MR. ZANARDI: That is the balance 



2* MR. JANIS: This is a running total of all the money 



that came through, but not — 



UNCUSSIHED 



451 



IB 



UNCLASSIFIED 



68 



1 - MR. NIELDS: Not the amount being invested, no. 

2 That is clear. 

3 BY MR. NIELDS: 

4 Q This is just a total of money paid, according to 

5 their accounting, to your benefit out of the enterprise, and 

6 they made mistakes because they have some expenses in there. 

7 A The way I read this document, Mr. Nields, is that 

8 these are the monies that were paid from the enterprise to CSF 

9 that somehow, somewhere, there must be then some allocation 

10 that it was paid to CSF for my benefit. 

11 So we need to have those back-up documents to see if 

12 the allocation is correct. 

13 MR. JANIS: My point was that since this wasn't a 
1* payment out of CSF into his capital account, it should have 

reduced his — the balance by $250,000 and not increased it. 
^8 MR. NIELDS: Let's go off the record. 

" (Discussion off the record.) 

MR. NIELDS: Back on the record. 
BY MR. NIELDS: 
Q Mr. Hakim, we are still on this transaction of 
$250,000 dated 5-21-85, and I think it is the best of your 
recollection that this is a $250,000 transfer to your personal 
benefit? 



UNCLASSIFIED 



I would like to again repeat, the only clue that I 



452 



UNCLASSIFIED 



69 



^ iiave, that I am going by, is not the bank record that you have 

2 shown me. That doesn't help me. It is the statement here in 

3 the ledger that says Re: Lo, and I — because there was a 

4 loan — therefore concluded this to be Re: Loan. 

5 I could be totally off. 

S Q And Re: Loan, you are interpreting, means that it 

7 was used to — 

8 A To repay back — 

9 Q Let roe finish. 

10 ~- to pay back a loan that had been made to you 

11 personally earlier? 

12 A That's correct. 

13 Q Next item that you can identify. 

14 A It says to Hotel Intercon right below that, Swiss 
16 francs, 578, and it has its dollar value as S224.12. I don't 

16 know which Hotel Intercontinental. I assume if it is Swiss 

17 francs, it is Intercontinental Geneva, and if it is Geneva and 

18 it is in '85, it must have had — must be charged to the 

19 expenses of the enterprise. 

20 Q Next item. 

21 A Now, I see the next item, the $50,000 transfer to 

22 the Bank of Korea — 

23 Q That was washed out, I take it. 

24 A That was washed off. 
26 Q Two items below. 



UNCLASSIFIED 



453 



ONCUSSinEO 



70 



^ - A Correct, two items below. 

2 So then we come to the next transaction, transfer 

3 to AH, Albert Hakim, $30,000. I need some back-up document 

4 to help me, please. 

5 MR. JANIS: For the record, Mr. Hakim has been shown 

6 H-1803, which is a debit advice from the Credit Suisse bank 

7 accoun'^. Energy Resources International. 

8 At the bottom there is a typewritten note. 

9 THE WITNESS: Mr. Nields , I am afraid that this 

10 back-up document doesn't help me to recall what this 

11 transaction was for, because it is more of the same thing. 

12 It doesn't say what it was for. 

13 MR. ZANARDI: You see this, STTGI? 

14 THE WITNESS: I can vaguely read Las Caros in 
'5 here, and you have traced this to the same transaction? 

16 MR. ZANARDI: Yes. 

17 THE WITNESS: If it says Las Caros and I see it, 
it says favor of Albert H. Hakim — here, Barclays Bank right 
here, so it is personal use, yes. 

MR. NIELDS: Okay. 

BY MR. NIELDS: 
22 Q The next item, $45,000 transfer to the Bank of 
23 



Korea. 



*^ A We covered that. 



UNClASSinEO 



26 



June 18. That is personal? 



454 



24 



ONCUSSIRED 



71 



1 A Personal. 

2 Then this cash withdrawal of $420.17, that must be 

3 a company expense. Which one I don't know, because it is not 

4 a round number and it must have been for paying bills for 

5 that amount. 

6 Q Okay. The next one? 

7 A The transfer to A. H. through Republic National Bank 

8 for $20,050 — do you have back-up documents for that, please? 

9 MR. ZANAROI: Yes. 

10 THE WITNESS: Okay. 

11 MR. JANIS: For the record, Mr. Hakim is referred 

12 to H-1784 and 1785. 

13 THE WITNESS: 27 June '85, the documents that you 

14 have given me, that is the date. 

IB Unlike the previous document from the Republic 

16 National Bank that had a destination, i.e., showed that it 

17 went to Barclays Bemk, I could complete the transaction, this 

18 one doesn't have a final destination. 

18 It could very well be expenses or cash that — I 

20 cashed out and used for the benefit of the contras. It could 

21 be — we must trace this to see where it ends. 

22 MR. ZANARDI: Just call it general, then? 

23 THE WITNESS: Yes. I am uneOsle to identify this 
transaction. 



UNCLASSIFIED 



28 I need back-up documents on the cash withdrawal. 



455 



Mussm 



72 



1 -iSth of July, $20,300, 

2 MR. NIELDS: Do we have it? 

3 MR. ZANARDI: We have it under Republic National 

4 Bank . 

5 MR. NIELDS: Page 25. 

6 MR. JANIS: What have we got here? 

7 MR. NIELDS: Transfer to STTGI . We have it marked 

8 that way. 

9 THE WITNESS: There were such entities, that they 

10 charged me, and it goes to STTGI because I ordered the 

11 transaction. So have you traced this through to STTGI? 

12 MR. ZANARDI: Let's see it for a second. 

13 MR. JANIS: We are looking at docuinent H-284. 

14 MR. ZANARDI: I haven't traced this one -- I don't 

15 know anything right now on this one. 

16 MR. NIELDS: You don't know of any? 

17 MR. POINTS: No. 
1> MR. SABA: No, 

19 MR. NIELDS: Oh, oh, oh, wait, this is something 

20 which is probably not — this is on their books under an 

21 expense item to STTGI. This item, this is a 40 — 

22 MR. JANIS: This is on the record? 

23 THE WITNESS: Yes. 
2* MR. ZANARDI: That is what it is, 
28 MR. NIELDS: We don't know what the $20,300 is 



on tne record? 

UNCUSSinED 



456 



NCIASSIRED 



1 'unless Mr. Hakim can reipember, and I take it he cannot. 

2 THE WITNESS: I cannot. 

3 BY MR. NIELDS: 

4 So this is a — you don't know? 

5 A It could be a raisallocation. 

6 Q The next one? 

7 A Now we are looking at the July 16 cash withdrawal 

8 of $^,500. Again I would categorize it as the small cash 

9 withdrawals that could be expense of any of the three entities, 

10 myself, the enterprise or Dick or STTGI. 

11 Q Just hold that one for a minute there. 

12 I am putting in front of you a document which is 

13 Bates stamped H-282 and I ask you if that refreshes your 

1* memory on the $2,500 transaction you have just been testifying 

1* about. 

18 A I don't know if — 

17 MR. JANIS: This is the wrong document, I think. 

** This docxnnent reflects a $250,000 transaction. 

^' MR. NIELDS: It was a single transaction. Most of 

*^ it went to Tom Clines, $206,000 went to Tom Clines. 

21 MR_ JANIS: This reflects $7,500 going to Mr. Hakim. 

22 MR. NIELDS: No, I think you are just reading a "2" 
23 



UNCLASSIFIED 



as a "7." It is a "2." 
2* THE WITNESS: Whose handwriting is this? 

28 MR. ZANARDI: Can I just see it; 



457 



UNCUSSinED 



74 



1 .. THE WITNESS: This is from CSF or from who? 

2 MR. POINTS: No. 

3 MR. ZANARDI : This writing right here, referring to 

4 these numbers, that is CSF writing. 

5 THE WITNESS: But — 

6 MR. JANIS: What is the other writing? 

7 MR. ZANARDI: The writing on the bottom is the 
e auditors from the House committee. 

9 BY MR. NIELDS: 

10 Q The point of this document is that on the ledger 

11 it indicates that on that day there was a $206,000 — 

12 $206,090 transfer to the C. Tea capital account. There was 

13 also a $2,500 transfer to the Korel's capital account. 

14 A How much was to Korel? 
16 Q $2,500. 

16 $2,500 to your capital account, and apparently a 

17 $50,000 transfer to Rafael -Quintero. 

18 A The only thing that we have that leads you to 
^9 connect these transactions together is the date; is that 

20 correct? 

21 Q The date and this transfer on the same day. 

22 MR. JANIS: Which transfer? 

23 MR. NIELDS: The transfer which is H-282. 

24 MR. JANIS: That transfer indicates — let me see it 

25 for a second. 



UNCUSHD 



458 



ONCUSSIHED 



75 



. .. MR. NIELDS: It indicates a total transfer of 

2 $250,000. 

3 MR. JANIS: Yes, of $250,000. You are talking about 

4 a $2,500 transfer. The only note on this document is AH, 

5 $420.17, which refers to -- 

Q THE WITNESS: And we have that $420.17 back up there. 

•J MR. JANIS: So I think we are looking at the wrong 

8 document. 
g MR. ZANARDI: I think it is the same document. It 

10 is just different parts of it. In other words, the 

11 transaction includes the 420. 

12 THE WITNESS: But we have a reflection of the 

13 $420.17 that I said must be some sort of expense. 

14 MR. ZANARDI: Yes. 

IB THE WITNESS: I see a reflection of that, and you 

16 tell me that that is CSF's handwriting. 

17 MR. ZANARDI: Right. 

18 MR. NIELDS: Let's go off the record for a second. 

19 (Discussion off the record.) 

20 MR. NIELDS: Back on the record. 

21 BY MR. NIELDS: 

22 Q We have been off the record, Mr. Hakim, and I take 

23 it it is your testimony tJiat you don't know for what purpose 

24 this $2,500 transfer on July 16 is for? 

25 A That's right, sir. 



ONCLASSIRED 



459 



UNCMSSIFIED 



76-90 



1 

2 

3 

4 

S 

6 

7 

8 

9 
10 
11 
12 
13 
14 
18 
16 
17 
18 
19 
20 
21 
22 
23 
24 
2S 



Q Keep going, then. 

A The next transaction, 22nd of July transfer to Las 
Caros, $75,000 for my personal benefit. 
Q Next? 

A 16 August, cash withdrawal, $2,943.46, and I need 
a back-up document , if you have something to refresh my 
recollection. 

Q I have it on here. It looks like Bank of America, 
San Francisco — no, it just says paid to cash. 
MR. NIELDS: Do you have a document? 
MR. ZANARDI: No. 
Do you have one? 

MR. NIELDS: I'll tell you in a minute. 
Advance on travel expenses for phase four, debit 
SciTech, Albert Hakim. 

MR. JANIS: Document H-261. 

THE WITNESS: Then this is a contra expense. 
BY MR. NIELDS: 
Q A contra expense? 

A Yes. It is advance, on travel expense for phase four. 
Q That is the last arms sale to the contras out of 
Energy Resources? 

A Whether it is the last one or not — maybe the last 
one was the stranded transaction, so it was — so it is a 



contra expense. 

Q A contra expense, okay. 



OILASSIHED 



460 



I 



Cantor/drg 
Take 2 
3:30 p.m. 



2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
IB 
16 
17 
18 
19 
20 
21 
22 
23 
24 
26 



WUSJIFIfD 



91 



BY MR. NIELDS: 
Q Mr. Hakim, I take it phase 4 refers to the fourth 
arms sale to the contras? 

A That is right. The document that you showed me 
that indicated that, were we on the record? 
Q We are on the record now. 

A No, when we were reviewing the document. When you 
showed me a document that showed my signature advanced to 
me $2,943.46. The next transaction, 28th, 10,000 cash with- 
drawal, do you have any backup document on that? 
(Discussion off the record.) 
BY MR. NIELDS: 
Q This goes to Bermuda. 

MR. JANIS: Looking at document H-661. 
THE WITNESS: I don't know what that is. The back- 
up documents don't help me. 
BY MR. NIELDS: 
Q I want to make sure I understand that. If it goes 
to CSF Investments Limited in Bermuda, wouldn't that indicate 
that it went to CSF to be invested on your behalf? 
A Not necessarily. 



CSF 



Q What other purpose would money go to 
Limited in Bermuda? 

A For investment on someone else's behalf, for 
instance, Kore 



Investments 



'\' 'kli 



461 



ONCLASSinED 



92 



C5F 

f Q But It IS credited on the SSt documents to your 

2 capital account rather than Korel's. 

3 A I am saying maybe I ordered it, and because I 
^ ordered it, they simply reflected it in my account. 

g Q I understand that. 

g A I do not know of any investment that I have except 

■J those that I have testified to about the reserve investments. 

g Q I take it that this is not an expense so far as you 

9 know? 

^0 A It doesn't appear to be. It does not appear to be "an 

f1 expense. 

12 MR. ZANARDI: Could I make a statement, whether it 

13 goes into the investment account or whether it goes into the 

14 companion account, they are interchangeable, so moving them 
IB from one account to the next account, you never know whether 

16 it is a matter of convenience, the way they transferred it to 

17 New York, or — 

18 THE WITNESS: That is true. 

19 BY MR. VAN CLEVE: 

20 Q But it is not correct to say this is a cash with- 

21 drawal. That is not your testimony that it is a cash with- 

22 drawal. 

23 A You are exactly correct. I do not recall that I 

24 withdrew cash. I simply do not understand this Hamilton, 
2B Bermuda being credited with it. Here it says "cash with- 
drawal", and then, as you mentioned, they interchangeably 



is not your testimony tr 

UNCUSSIFIED 



462 



2 



DNCUissm 



93 



use the investment company. 
BY MR. NIELDS: 

3 Q Let's get going. You don't know what that is? 

4 MR. JANIS: I think what he is saying here is the 

g fact that these transactions appearing in this ledger doesn't 

g necessarily mean that the ledger is accurate. "e didn't 

7 prepare the ledger. It doesn't mean it is inaccurate, but it 

8 doesn't mean it is accurate. If he ordered a transaction from 

9 CSF, it is entirely possible that Farina could have credited 
to it to his account when it should have been credited to some- 

11 body else's account. 

12 MR. VAN CLEVE: But wouldn't it be fair to say as 

13 to CSF Investments Limited as a normal matter, if money comes 

14 through there, it is for investments of some kind? It is 
IB not for cash payouts? 

16 THE WITNESS: That is the logical conclusion, but 

17 that doesn't mean it is the way the CSF financial system works 

18 as Lou says. We have seen that in many other transactions. 

19 They use whatever facility they have that is efficient at 

20 the time that they want to perform that certain transaction. 

21 Going to the next one, the 7,000 cash withdrawal, 

22 Lou, do you have any backup document on that? 

23 BY MR. NIELOS: ^ 

24 Q It says CSF Geneva. 

%v' * , ^. — - _ _ - 

28 MR. JANIS: Looking at H-1758, this record simply 



♦ 



463 



UNCUSSIHED 



94 



- iTidicates that 7,759 was transferred from Lake Resources -- 

2 MR. NIELDS: The only question is whether it 

3 refreshes his memory. 

^ THE WITNESS: It does not. 

MR. JANIS: We are now looking at H-1760, a hand- 

g written note. This is one we have looked at previously. 

y MR. ZANARDI: I think Korel is in there, if you 

g read through those papers. 

g MR. JANIS: For the record, this note indicates 

^0 that at Albert Hakim's request we gave cash — 

I) MR. NIELDS: Let him just read it to refresh his 

12 memory. 

t3 MR. JANIS: I want this to be on the record, 

t4 $7,000 to some cat. 

15 THE WITNESS: This is category, I believe, isn't 

16 that a point? 

17 MR. JANIS: That is period. 

18 THE WITNESS: Short for category? 

19 MR. JANIS: No. 

20 THE WITNESS: What is the date on this? 

21 MR. JANIS: September of 1985. 

22 THE WITNESS: Mr. Nields, during that period of 

23 time, do you recall if there were any incidences with the 

24 operations of the contras? I am not talking financial, but 

25 operationally. Did anybody die, get killed? 



UNCIASSIHED 



464 



UNCLASSIFIED 



95 



1 MR. NIELDS: You may have bought a Maule airplane 

2 at about then. 

3 THE WITNESS: No, that would have been a direct 

4 transfer. We made a payment to a funeral home at some date 

5 that I don't remember. I believe it had to do with when the 

6 aircraft was shot down. 

7 MR. NIELDS: That is a year later. 

8 THE WITNESS: I don't know, but I see here Trade 

9 Development Bank, and, again, I would like to say since the 

10 only relation that I know had to do with Trade Development, 

11 maybe paid the bill. But I don't see why they refer to it 

12 as cash. This completely throws me off. 

13 BY MR. NIELDS: 

14 Q You don't know what that is, but you think it 

^B might have something to do with American Express, is that it? 
^8 A Exactly. 

Q Let's go to the next one. 

A As a matter of fact, it may really be that, because 
here I see in the last document it says "Trade Development 
Bank Geneva". 

BY MR. ZANARDI: 
** Q Would that be personal? 

** A No, that would be the company expense, American 
Express company expense 



i 



UNCLASSIFIED 



465 



liNCUSSinED 



96 



BY MR. NIELDS: 

2 Q Because of the timing, the Iran Initiative had not 

3 begun yet, I take it that would make it contra? 
A That makes sense. 

5 Q Okay. 

g A The next transaction, 11,500. Do you have any 

7 backup document with that? 

3 Q We may have something on this. 

g (Discussion off the record.) 

10 BY MR. NIELDS: 

11 Q Back on the record. The $11,500 entry for September 

12 23, you are not certain what that is? 

13 A No. The next transaction, 9,500, is contra. 

14 Q All right, next? 

16 A I categorize the next transaction of the $5,000 

16 as before — 

17 Q You are not sure what it is? 

18 A Since it is small, it could be company expenses, 

19 enterprise expenses, or personal. 

20 Q I think the next page should go more rapidly. I 

21 have a feeling you will know more of them. There are some 

22 large ones here that are obviously important to us. 

23 (Recess.) 

24 MR. NIELDS: Back on the record. We are over to 
26 page H-965 of Exhibit 1. 




U-MJ»3 



466 



3 f,?>: 



97 



BY MR. NIELDS: 



mssim 



2 Q There is an entry October 4. 



A Personal. 

Q That is for the $1,500? 



g A Right. 



Q The amount under that is 2,000. 
■J A I categorize it again as expenses that can be 

S attributed to any of the entities I testified to earlier, 
g Q Okay, the next item is $102,000. 

)Q A Could I have some backup document on that? 

y^ Q Abu Dhabi. 

12 A Yes, I think I know. 

13 MR. JANIS: Page 604. 

14 THE WITNESS: That is STTGI. There should be a 

15 reflection of this in the STTGI books. 

16 BY MR. NIELDS; 

17 Q So I take it that is a payment that is equally for 

18 your and Mr. Secord's benefit? 

19 A Effectively. 

20 The next item, 2,000 — 

21 Q I am sorry, I think maybe we ought to get just a 

22 little more detail about that $102,000 to Abu Dhabi for the 

23 benefit of STTGI. 

24 A STTGI needed money for its expenses to perform at 
26 the same time services for certai_n_UAE^ companies . If you 




467 



UNCLASSIFIED 



98 



"want to go into the details of what services we rendered, I 
will be more than happy to do that when you want, and they 
_ did not pay us, and we took the money out of the enterprise 
. and paid STTGI to compensate STTGI for those expenses. 
_ Q When you say he took money out of the enterprise, 
who was he? 

A I said we. 

Q Oh, we, sorry. All right. The next item. 
Q A This, by the way, should have come out of SciTech. 
fQ Again, this is a misallocation. 

If Q Okay, next item, $943.40. Is that an expense item? 
f2 A Expense item, I would say contras. It says Suisse 

13 francs, 2,000. So it was moneys paid for the expenditures 

14 there. 

1Q Q Okay, next item is §43,030. 

18 A Can you give me some backup document on that please? 

17 Q Republic National Bank in New York. 

18 A A day apart there is also another 20,000. The 

19 next day is 20,000 maybe the same. 

20 Q Our backup on the §4 3,000 amount simply shows that 

21 it went to Republic National Bank. 

22 A So I won't be able to — did you say you had soraethir 

23 on the 20,000? The same way. Really it j3pesn^_have any 

24 more information in here. 

25 MR. JANIS: Looking at H-1726 and 1729. 



ay. Really it doesn't ha 

UNCLASSIHED 



468 



17 



21 



UNCLASSIRED 



99 



1 THE WITNESS: It doesn't have additional informa- 

2 tion. 

3 BY MR. VAN CLEVE : 

4 Q Could I just ask, Mr. Hakim, did you keep any kind 

5 of an accounting record of your own with respect to these 

6 expenditures? 

7 A No. 

8 Q Outside of CSF? 

9 A No, I didn't. 

10 Q And, to your knowledge, did they keep sub-account 

11 numbers on their books? In other words, let's suppose you 

12 had an expenditure for the contra program. Would they have 

13 had a series of numbers to show what category of expenditure 

14 was being made? Would those be reflected, for example, on 

15 these telexes? 
18 A Not necessarily, no, because I testified 

that I made an attempt to get to that point at a later dat«. 
" but earlier it was not done. 

'* Q So that the numbering on the telexes is not going 
20 to tell us anything about the accounting classifications. 

A To the best of my knowledge, no. It has no 
22 substance really. 
*' BY MR. ZANARDI: 

Q This is their indication from the Republic National 
Bank. It says "repayment of line of credit." Would that 



UNClASS!nE:5 



469 



wtmm 



100 



- refresh your memory any? 

2 MR. WECHSLER: Which month is this on? 

3 MR. SABA: This is the 13th. 

4 THE WITNESS: The only thing that this would indicate 
g to me, that this was from their — if you check the National 

g Republic Bank record?, see if this has gone to STTGI, then it 

■J means it was paid as part of the line of credit that CSF 

g had provided us. 

g MR. JANIS: You also should check to see whether CSF 

]Q had its own line of credit with Republic National Bank, 

^^ which I assume it does. 

12 BY MR. NIELDS: 

13 Q Mr. Hakim, I am going to divert your attention 

14 just for a moment. 

15 MR. JANIS: There is another so-called diversion. 

16 BY MR. NIELDS: 

17 Q This is another matter of considerable importance 

18 to the committee, so I would ask you to try and search your 

19 memory as much as you can on this. How did you first learn 

20 of an Iranian Initiative? 

21 A I believe when Mr. Secord asked me if I knew a 

22 certain Ghorbanifar, without referring to any Iranian 

23 Initiative, I asked him if it was Manucher Ghorbanifar, and 

24 I don't believe what his answer was 
28 MR. JANIS: You don't belTeve or you don't remember? 



pianucner (jnoroanirar , ana 

MASSIHED 



470 



UNCLASSIFIED 



101 



THE WITNESS: I don't remember what his answer was, 
and I told him if it were Manucher Ghorbanifar, I knew him 



1 

2 

3 when he was a SAVAK agent and also he was recruited by the 

^ Israelis, and he told me, no, it could not be the Scime person. 

E That was his answer, and then a few days later, he gave me a 

g bu"ch of numbers, telephone numbers, and asked me to trace 

■J this man in Paris, and because he had difficulty locating him, 

g and I believe at that time he shared with me a little bit of 

g what was going on, that they were trying — he tried to 

(Q remain secretive, but then he had to tell me something so 

\\ I could help him. That is when I started to trace Ghorbanifar, 

12 and this was one of the times that I believe in his testimony 

t3 Mr. Secord said thatuie would disappear off the scope and they 

14 would make a search. 

IB BY MR. VAN CLEVE: 

18 Q When was this, if you remember? 

\^ AX don't remember the date. 

18 BY MR. NIELDS: 

19 Q Where were you when he first asked you this? 

20 A I think I was in California. Oh, when he asked me 

21 if I knew Ghorbanifar? I don't remember that, where I was, 

22 but I do remember trying to trace Ghorbanifar from my home in 

23 California. 

24 Q What is your best recollection of when you had 

25 these conversations? 



UNCLASSIFIED 



471 



5 



KUSSIflED 



102-103 



' A I would say late '85. I believe it was late '85, 
I am not sure. 



1 

2 

3 Q Where was Mr. Secord at this point? 

^ A Or early '86. I think he was calling me from 
Washington or Vienna, from our offices there. 

a Q Not from overseas? 

y A No, I don't think so, no. 

3 Q Let me get at it this way, if I can. One of the 

g entries in these records is a $1 million deposit into the 

^0 Lake Resources account in November of 1985. 

fl A Yes. 

12 Q That was apparently put there by the Israelis. 

13 Were you aware of that deposit when it occurred? 

14 A You mean aware that such a deposit had occurred? 
18 Q Yes. 

16 A If Richard would have told me to expect a receipt, 

17 a deposit, I would simply watch for it, and inform him when 

18 we received it, because we had a lot of cases as such that 

19 he would call me and say "Expect to receive such and such 

20 amount." 

21 Q My question is, do you remember receiving a $1 

22 million deposit in connection with Iran? 

23 A No . 

24 Q Not at all? 
28 A Do you remember a time when Mr. Secord went to 



uNCiAssra 



472 



UNCUS$IFIED 



104 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

2S 



[assist on an Iranian transaction? 

A I think I learned about that much later, when I 
was briefed on Ghorbanifar, that at the time that he took 
the trip or shortly after that, no, I was not informed about 
it, but later I believe he told me. I don't remember when. 

Q To the best of your memory, was the conversation in 
which he asked you if you knew Ghorbanifar, did that happen 
before or after his trii 

A I believe after. 

Q So you were not aware at the time he went | 

[that there was any transaction involving Iran? 

A No. 

Q Or even that there might be such a transaction? 

A No, I was not aware of that. 

Q When did you first learn why he was interested in 
Ghorbanifar? 

A You are asking for the date? 

Q Well, if you can give us an approximate time, how 
long after he first questioned you about it? 

A It is just a wild guess. Maybe a few weeks later. 

Q And what did he tell you then? 

A As to why he was interested in Ghorbanifar? I can't 
recall really if he was — he was not specific. He simply 
asked me if I knew about the man, and normally — I have alread 
testified to this, normally I tried not to question Secord 



iiNd mm 



473 



UNCIASSIRED 



105 



. too much. He reacts to that. 

2 Q What I am asking is how did you find out that there 

3 was a transaction with Iran that was going to involve arms 
^ and hostages? 

- A When I got involved in Frankfurt. 

a Q Not before then? 

y A Before that I started to sense that there was 

a something going on, when he asked me to trace the man, I 

g started to deduct and speculate. 

^Q Q Hadn't there been an actual shipment of arms before 

^ ^ you went to Frzmkf urt? 

f2 A I was not aware of it. 

^3 Q You must have been aware of a $5 million deposit 

14 into the Lake Resources account. 

15 A Did that occur before the February meeting? 
te Q More like a week before, I would say. 

17 A I don't recall if I connected that to the Iranian 

18 Initiative. I don't remember that. I may have. 

19 Q There was a payment out of the Lake Resources 
account November to ^^^^^^^^^^^^^H $127,000. 

21 Was that a payment that you were aware of at the time? 

22 A Not at the time. 

23 Q Is that one that Secord would have had the authority 

24 to advise Zucker and have him pay, or would he have had to 
2B go through you? 



UNCIASSIHED 



474 



25 



^ilt/SSSIREB 



106 



. A I would say either way it could have happened. It 

2 could have happened either way. 

- Q But if he went through you, he would have just 

. instructed you, and you would have followed without asking 

K questions? 

a A That is correct. 

y Q Okay, let's return to the ledger. I think we just 

g covered the $43,000 — 

g A And the $20,000. 

^g Q And both of those are question marks, I take it? 

If A Right. 

^2 Do you have anything on 25? The seune thing for the 

13 25. Anything for the 21, Lou? Again, the same thing? So 

14 the answer is again question mark. 

15 Q I don't think this is going to help you. This is 

16 all we have on it. 

17 MR. JANIS: H-1713. 

18 THE WITNESS: More of the same thing. It doesn't 

19 have any indication that would say. It doesn't help me. 

20 The next two transactions, $9,529.32, and the 

21 $4,098, they are both personal to me, my benefit. 

22 The next one, the 5,000 Swiss franc action, that 

23 corresponds to 2,386.63, simply because it is Swiss francs, 

24 and it says "cash withdrawal", I would attribute that — 



mmmm 



475 



*«xm 



107-120 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

18 

16 

17 

18 

19 

Cantor/drg 20 

end 
Boyum fols. 21 

22 

23 

24 

25 



BY MR. ZANARDI: 
Q That has Secord on it. 

MR. JANIS: H-569. 

THE WITNESS: That is what I was about to say. 
It is not necessarily to be charged to me. This is a contra 
expense . 

MR. JANIS: For the record, H-569 is a receipt 
showing that $5,000 was signed for by Richard — excuse me, 
5,000 francs was signed for by Richard Secord. 

THE WITNESS: Same date? 

MR. JANIS: Yes. This was apparently attributed to 
your account. 

THE WITNESS: Exactly. This is a contra or Iran 

expense . 

MR. WECHSLER: We are still in 1985? 

THE WITNESS: Yes. It could have been both. 

MR. NIELDS: No, it could be Iran at that point. 

THE WITNESS: It could be Iran at that time. This 
is another sign of the misallocations. 



yilKSIBEB 



476 



BOYUM 

CAS 

4:15 



UNCLASSIFIED 



121 



BY MR. NIELDS: 
Q Next. 
A I think — 

Q I am sorry. I am going to go back. Why is it 
that you say the $9,529 and the $4,000 transfers are 
personal? 

A It is for my insurance premium. You see Vita? 
Q Yes. 

A From the times that I lived in Switzerland. I have' 
my life insurance purchased there. That is the njune of the 
insurance company. 

Q Okay. Next? 

A Now, my understanding for the next item is that 
they had not credited my account for Phase I, II, III of the 
contra sales and for that amount they finally credited my 
account. That is the best way I can describe that. 

MR, JANIS: You are referring to the figure of 
$82,031.09? 

THE WITNESS: Yes, that says "balance of account. 
Phase I, II, III." 

BY MR. NIELDS; 
Q So that is personal, that is investment for you? 
A That is the best way that I cem deduct. 
MR. JANIS: Wait a second. 



UNCIASSIHED 



477 



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 



122 



UNCUSSIREO 



THE WITNESS: It may not be personal. See, there 
are — as I — 

BY MR. NIELDS: 
Q If these are transfers that relate to the balance 
of Phase I, II, and III, I take it that means -- 
A I should be getting it. 

Q — whatever your share of the commissions on the 
first three arms sales to the contras somebody, you.are 
owed more money and this is the amount and it is evening up the 
accounts. 

A But it doesn't mean that I got it because if you go — 
they were A.H. accounts for different purposes with sub- 
titles. They may show in this ledger that it went to A.H., 
but I actually don't know where it ended up. 

Q But it should have gone to an account for your 
personal benefit. 

A That is what I testified, but I am saying that it 
may not. 

MR. 2ANARDI: Just one. The point is that this is 
invested in CSF for you; right? 

THE WITNESS: It should have. 
MR. WECHSLER: Should be, yes. 

THE WITNESS: Whether they actually did it or not, 
we need to further investigate. 

MR. ZANAROI: When you begin To 'calculate" Re 




478 



UNcussm 



123 



reserve for the enterptise, this is not part of that reserve? 

THE WITNESS: That was not — exactly, you are 
right. The reserve was annotated differently when I instructed 
them. 

MR. ZANARDI: Okay. 
BY MR. NIELDS: 
Q Next item, $100,800. 

A Same answer, except it refers to Phase IV. 
Q Just the fourth arms transaction? 
A yes. 
Q May 1986 now. 

MR. ZANARDI: I have good back-up this time. 
THE WITNESS: No, that one I know. Personal. My 
attorneys in San Francisco. 

By the way, for your better understanding. Bob 
Gooding and Howard Grise is the same law firm. 

MR. VAN CLEVE: That the Mellick firm? 
TEE WITNESS: No. This is Howard, Grise and a 
bunch of other names. 

Next transaction is — 
BY MR. NIELDS: 
Q $165,000 on February 2. 
A I need some back-up documents on that. 

MR. ZANARDI: How about if I tell you what happened? 
THE WITNESS: Tell me. 



UNCU<;<;iFiFn 



479 



UNCLASSIHED 



124 



MR. ZANARDI: The 165,000 goes to Bermuda, the 
same day -- it is part of an overall transaction in which 
Korel is also credited $165,000. 

THE WITNESS: If you have such a documentation, 
does that date correspond to the time of the distribution of 
the profits? 

MR. ZANARDI: When I — 

THE WITNESS: Let me ask the question differently, 
is there a shipment that when you chop it up between the 
interested parties, the 165 constitutes a certain percentage? 

MR. ZANARDI: Yes, I think so. 

THE WITNESS: If you have such a back-up document, 
then it is my share of the profit. 

MR. ZANARDI: I have that in the records. This is 
Hakim document H-1540. 

MR. VAN CLEVE: The witness is examining H-1540. 

THE WITNESS: It makes sense, Lou, your analysis 
makes sense. 

MR. ZANARDI: Okay. When you see this, what does 
this mean, leave in the account? To the best of you understandii 
what is that? 

MR. JANIS: Looks like INV. 

THE WITNESS: Invoice account. 

MR. ZANARDI: Does that have investment there? 



UNCLASSIFIED 



480 



ONCLASSIFIED 



125 



THE WITNESS: Oh, yes, investment account. This is 
CSF's handwriting. 

MR. ZANARDI: This would be just like the other 
transactions. Yes, it is CSF handwriting. 

THE WITNESS: So that is the investment account. 
BY MR. NIELDS: 
Q I take it the answer on the 165,000 is to the best 
of your understanding that is a profit distribution? 
A Yes, sir. 
Q To you? 
A Yes. 

Q The next transaction? 

A Do you have any back-up? $1,351.42. It appears to 
be an expense because it says cash withdrawal, so it must be 
against a certain invoice, a certain expenditure for the 
companies, one of the companies. 

MR. NIELDS: I don't have anything. 
MR. JANIS: Looks like about 2,000 Swiss francs, 
isn't it? 

MR. NIELDS: It is February 19. 

MR. VAN CLEVE: There is no back-up noted here. 
MR. NIELDS: We don't have 2uiy back-up. 
THE WITNESS: It must be a company expense because 
of the exact figure of $l,j 



OiUSSIRED 



481 



^ 



UlLASSIHED 



126 



meant. 



BY MR. NIELDS: 

Okay. Next. 

Here we come to — 

MR. JANIS: Is that part of the enterprise? 

THE WITNESS: Part of the enterprise, that is what I 



MR. JXnIS: Off the record. 

(Discussion off the record.) 

MR. NIELDS: Let's go back on the record. 

THE WITNESS: The next item refers to CSF investment, 
A.H. sub-account and the amount is $2 million. This is what 
I have referred to in the chart that we talked about a couple 
days ago as the reserve that I classified as reserve. General 
Secord classified it as self-insurance money. 

BY MR. NIELDS: 
Q Finish your answer, and then we will have a 
question. 

A It is a set aside money for reserve for the 
enterptise. I classified it differently than General Secord. 
General Secord needed the money at that time to be set aside 
because he had to get the aircraft for shipment of the 
arms that we were about to make and we had to have insurance. 
The Israelis needed to have a guarantee so we set that aside. 
But as a businessman, I also took into consideration that 
one possibility is that we have to pay the Israelis if the 



482 



iCUSSIHED 



127 



plane should go down and the other possibility is we don't have 
insurance, so it is best to classify it as reserve, not as 
insurance money. That is why in my little chart there I 
showed CSF investment reserve. So this is the sub-account 
A.H. , $2 million. 

Q Do you have a question, Lou? 
If you don't, I do. 

MR. ZANARDI : I have just one question, but why 
don't you ask yf^rs. Mine goes with something else. 
BY MR. NIELDS: 

Q What I don't understand is why this money 
was transferred at that time? It says March 5, it was 
transferred into a A.H. sub-account, $2 million. Why was 
it transferred at that time? 

A I cannot answer the question why at that time. That 
is the time that General Secord told me to set aside that 
sun of money. 

Q Let me sharpen the reason why I am asking you the 
question. If General Secord asked you to set the money aside 
to cover the possible loss of the Israeli plane, the timing 
is odd because the plane had already_^2wn the mission amd 
come back. 

MR. JANIS: I think if I understood General Secord ' s 
testimony he said that is the reason that the two million 
dollars was built into the price. Once the plane — 



e plane had already flowr 

UNCUSSn 



483 




said. 



128 



MR. NIELDS: No, that wasn't his testimony. 
MR. JANIS: My understanding is that is what he 

MR. NIELDS: He said it was put in a CD. 

THE WITNESS: When actually was the shipment made? 

MR. NIELDS: Two shipments were made both in 
February. 

THE WITNESS: Late February? 

BY MR. NIELDS: 
Q Yes. 

A So it may very well be. I cannot be sure. It may 
well be that I was not present and — 

Q Let me sharpen my question and see if this helps 
any. Is it possible that this money was transferred out of a 
CD and/or a call account and into a reserve after the plane 
had flown the mission when it was no longer needed for insurance 

MR. JANIS: Let me see, before you answer, do you 
have any indication that there was a CD? 

MR. ZANARDI: Yes, I do. That is one of the points 
I was trying to make. I think the^e was both a CD and a set 
aside for the reserve at the ssane time. We have a CD account 
that ran a balance pretty close to the $2 million all the way 
through. That was at Hyde Park. 

MR. NIELDS: I have got a composite list somewhere in 
here. 



UNCUSSinED 



484 



UNCUSSIHED 



129 



MR. ZANARDI: Can I ask my other question? 

MR. NIELDS: Sure. Go ahead. 

MR. ZANARDI: How did this transaction work in terms 
of transferring the money to CSF? Was it a — I thought the 
records looked like there was a cash withdrawal for 
twelve million, you put three million into one of your 
accounts and I see two million that seemed to just disappear. 
Did you -- 

THE WITNESS: I understand what you are saying. You 
lose track of $2 million. 

MR. ZANARDI: Yes. 

THE WITNESS: If you go back, Lou, and check, you 
should see an expense about that time paid to the bank for us 
to cash that much money out. 

MR. ZANARDI: Right. 

THE WITNESS: So when you see such a — my guess is 
I can't remember correctly, but the cash out is $2 million, 
it would have cost us approximately $20,000 or something, 
about that much, to cash that kind of money out. That is 
what we have to pay to the Swiss bank. That is how we 
memage to lose the traceability of the monies. 

MR. NIELDS: Let's go off the record for a moment. 

(Discussion off the record.) 




MR.^ NIELDS: Back on the record ' "**""' 

THE WITNESS: I believe, Mr. Nields, your analysis 



485- 



UNCLASSm 



130 



might be closer to actually what happened. 

BY MR. NIELDS: 
Q Let me say, Mr. Hakim is referring to an analysis 
that I disclosed to him off the reocrd, I think, but in any 
event, he will say what it is. 
A Your analysis -- 

MR. JANIS: To the best of your recollection. 

THE WITNESS: Yes, to the best of my recollection, 
your analysis is correct that there was indeed that sum of 
money, $2 million, in certificates of deposit and later we 
transferred it into an investment account simply to have 
maximum income. You would have had more income from the 
investment activity rather than the CD activity and I believe, 
again, at that time it had become more apparent that the 
enterprise would be more involved in dealing with Iran, so 
we wanted to make sure that the money was completely set aside 
for reserv#e purposes. 

MR. ZANARDI: Did — once you made the investment, 
the money into the investment account, did that make it less 
liquid, less ability to get cash real quick than if you would 
have had it in a CD? 

THE WITNESS: Not necessarily. 

EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 

BY MR. VAN CLEVE: 
Q Let me ask a couple of follow-up questions. 



ALT OF THE HOUSE SELECT C 

UNCLASSIFIED 



486 



ONCussm 



131 



As I understand it, the purpose of having a 
$2 million account to self-insure is the shipment would be in 
the event the plane was lost the Israelis could be 
reimbursed for the value of their airplane? Is that correct? 

A And the goods probably. 

Q No, the goods were clearly worth more than the $2 
million. 

MR. NIELDS: Also the Israelis didn't own the goods. 
BY MR. VAN CLEVE: 

Q So the first question I have is did you ever put a 
lock on any account in favor of the Israelis? 

A No, no. 

Q So there never was an insurance policy issued in 
favor of the Israelis, was there? 

A Not that I know of, no. 

Q Okay. So was there ever any document sent to the 
Israelis to demonstrate to them that $2 million had been set 
aside in an account , to your knowledge? 

A To my knowledge, it was all done orally. 

Q So they basically took your word for it — 

A Not my word. 

Q Then whose word? 

A General Secord's. 

Q They took General Secord's "word? 

A I had absolutely no contact witn the Israelis. 



UNCLASSIFIED 



487 



UNCUSSIFIED 



132 



Q So they took General Secord's word that $2 million 
had been set aside somewhere to protect their airplane? 

A Yes. 

Q And they were willing to do business on the basis of 
that kind of oral assurance? 

A This is what General Secord told me. 

Q Okay. To your knowledge, were any of these arms 
ever insured, the arms themselves? 

I know yesterday we talked about insurance for the shii 
You went out and got insurance for the ship that Dolmy bought 
and you told us that you thought the insurance must be at 
least -- that the purchase price of the ship was the minimum 
face amount of the insurance. 

To your knowledge, were any of the weapons that were 
sold to Iran ever insured for any amount? 

A I have no idea. I don't know. 

Q It would have been a very substantial expense, 
wouldn't you agree, to ensure those weapons? These were 
millions of dollars worth of weapons. 

A I don't know. 

Q As a businessman I _think__;^o_i^^n agree that it would 
cost — 

A I don't even know if insurance companies insure — 

Q These are just goods, Mr. Hakim, millions of dollars 
of goods. And as a businessman, surely you can agree that it 




488 



yNCLASSIFIED 



133 



would have cost a great deal of money to insure these weapons 
against loss in that situation. 

A What I am saying is I am not an 

insurance expert. I don't know whether insurance companies 
insure ammunition, arms and so on. I have no idea. I don't 
know. 

Q Let me put it to you this way. 

If you were shipping goods to Iran, would you 
try to insure them against loss in transit? 

A What goods? 

Q Say medical supplies? 

A Definitely. 

Q You would be concerned if they were lost over the 
Arabian Sea that — 

A It is a normal practice, yes. A practice that you 
always do. Even based on my experience when you give a 
price to a client for goods, you give it on a GIF basis which 
is cost, insurance, and freight. Insurance is a very important 
part of this, but I have no idea how the arms business is 
handled in connection with insurance. 

Q You did tell us that you went out and got insurance 
for the ship Dolmy bought even though it was going to be 
engaged in very hazardous activity. You went out and insured 
it, didn't you? 

A Yes. 



UNCUSSIFIED 



489 



134 



ONCUSSIRED 



Q And you told it was very expensive because it was 
engaged in hazardous activity; correct? I believe that was 
your testimony? 

A I don't recall what the context these questions 
were asked, but whether it was expensive, what documents 
I was shown. 

Q To your knowledge, were the arms themselves ever 
insured by the enterprise in any way? 

A I iun not aware of any such insurance. 

Q Okay. Has General Secord ever mentioned to you the 
need to insure the arms against loss in transit? 

A Not that I can recall. 

Q Or against theft? 

A Not that I can recall. 

Q Thank you. 

A You are welcome, sir. 

MR. JANIS: Just to cl2u:ify things, at one point Mr. HaJdm 
indicated he didn't have any contact with the Israelis. I 
think he mezint that in the context of your question because 
he has already testified to having been present in a meeting 
in February of 1986 when there were Israelis present and at 
other instances in which he m^.^^ the Israelis; is that 
correct? 

THE WITNESS: The only time that I remember to have 
been in contact with Israelis was in the February meeting 




490 



UNCUSSIFIED 



135 



that Mr. Nir was there, but I would not even say that I was 
in contact with him. He was present in the meeting. 

EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 

BY MR. NIELDS: 
Q Are you aware of any documents that would reflect 
this transfer of the $2 million into the custody of CSF? 
We don't have any. 

MR. ZANARDI: I couldn't find any. 

MR. NIELDS: There are no documents that reflect 
this transfer other than the ledger? 

MR. ZANAROI: As I explained before, when you cashed 
it and you lose the trail just like you wanted us to do, 
and if it wasn't for the ledger we wouldn't know what 
happened to that $2 million. We are not even sure. But 
don't they give you some type of documentation that you have 
invested $2 million in a CD or anything with CSF? 

THE WITNESS: Wouldn't you defeat the purpose if you 
did that? 

MR. ZANARDI: No, no, just for yourself. 

MR. JANIS: For his purpose the information was on the 
ledger and I think he has testified that he had_comp^te_ 
confidence in the integrity of CSF.Zn''J 

THE WITNESS: There is no question aboutkhat. But 
to 2Lnswer your question, if you could go back and document 
it, why go through the trouble of spending the — 



491 



136 



UNCLASSIHED 



MR. NIELDS: Let's not argue, the answer is yes or 
no, either you know of documents or you don't know of 
documents . 

MR. VAN CLEVE: Other than what you have produced, 
are you personally aware of any documentation that would 
corroborate this $2 million transfer? 

THE WITNESS: There should be — I think I have 
testified to this either yesterday or the day before that there 
should be fiduciary agreements in connection with that. 

BY MR. NIELDS: 
Q Particularly in connection with the $2 million 
transfer? 

A Not "transfer"; "investment". 

MR. VAN CLEVE: Mr. Nields was not here during the 
period when Mr. Liman and I questioned him about :this, but 
you did tell us there should be what I think Mr. Liman called 
testimentarian instructions with respect to the $2 million. 
Are those the documents you refer to? 

THE WITNESS: No, no, I am talking about fiduciary 
agreements for investment. 

MR. VAN CLEVE: Those were parallel documents that 
were executed at about the same time; is that correct? 

THE WITNESS: You are talking about the-- about 
what I referred to as will? 



UNCLASSIFIED 




492 



...if I "I iii"i'irirn 

MR. VAN CLEVE: Yes, 

THE WITNESS: I don't know whether they were done 
at the same time, but to answer the question that Mr. Janis 
asked, do I know of any other document that would support 
this transaction, I said there should be -- my answer is 
there should be a fiduciary agreement that I was a party 
to that contract and CSF investment would have been the other 

party to the agreement. 

u 
That sould say $2 million investment is being made 

with them under A.H. sub-account whatever it was. 

MR. VAN CLEVE: Okay. 

MR. NIELDS: All right. 

THE WITNESS: We talked about this yesterday, I 
think. 

MR. JANIS: Yes. 

THE WITNESS: Mr. Janis will try to clear that. 
We went through all this. 

BY MR. NIELDS: 
Q Next item, $28,000, March 18. 

A It says CSF investment A.H. sub-account. Do you have 
any back-up documents? 

If you don't, I don't know what it is. I can 
guess because it says A|lf || ^^r^f-a^c^^ g p^tp^q^^ld be money 
invested for — 

MR. POINTS. It goes to Geneva, CSF, Geneva, $28,000. 



"Offl'SSlflEir 



493 



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 



138 



.PMHEP, 



THE WITNESS: But it doesn't sly for what purpose? 

MR. POINTS: Then the $50,000 below that says CSF 
Bermuda . 

THE WITNESS: VThat it says is A.H. sub-account. To 
me, A.H. sub-account - 

MR. WECHSLER: It just says A.H. 

THE WITNESS: Sorry. Sorry. 

My marker just moved up a little bit. I don't know 
what that is. Do you have any back-up? Your back-up 
document doesn't say where it goes? 

BY MR. NIELDS: 
Q The back-up document says it goes to — look at it. 

MR. VAN CLEVE: This is H-225 that Mr. Hakim is being 



shown. 



got it. 



THE WITNESS: Whose handwriting is this? 

MR. NIELDS: I believe that was on there when we 



UNCIASSIFIED 



MR. ZANARDI: That is CSF's. 
MR. JANIS: You sure? 
MR. ZANARDI: Yes. 

MR. POINTS. It is not ours. 

Anything we put on would be down at the bottom. 

MR. ZANARDI: This is the other one. 

THE WITNESS: March. I can't recall in March, 

March 18, 1986, I can't recall receive „ 

receiving amy money in 



494 







139 



bm 



cash. It doesn't even say where. It says cash to Hakim. 
I have no idea what that is. 
BY MR. NIELDS: 

Q There is a $50,000 transfer on the same day. 

A To where? 

Q Move our marker down. 

A Okay. 

Q That is a substantial sum of money that was 
transferred all on the same day. This one goes to Bermuda, 
it appears. 

A Do the dates, Mr. Nields, correspond to any of the 
shipments that could have been distribution of profit? 

Q There definitely were shipments in March of 1986. 

A I cim talking about contra shipments. 

Q I understand. That is what I am talking about, too. 
But this is not a distribution of — there are no 
corresponding transfers into the accounts of any of the 
other parts. 

A Then I definitely would say either they are ad Justin 
their accounts that they had not been adjusting as a result of 
our inspection, or this is em expense. 

Q Do you recall emy expenses in this amount, $78,000? 

A When I say "expense", I don't mean a bill for 
$78,000,, it could be casb _qj.yep_ta GeOfiCcLL-SfiCOrd for the 
purpose of the contras. 



I 



\ 




495 



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 



yNCLASSIREO 



140 



Q So you are not certain on either of these? 
A No. 

Q Okay. Next item. 
A Okay. 

Q $72,580 on the 17th of April. 
A Do you have any back-up document on that? 
MR. ZANARDI: Yes. 

MR. JANIS: H-904. The handwritten part says 
"amounts received by A.H. totalling $72,580". 

MR. WECHSLER: It is apparently also 136,000 Swiss 
francs. 

MR. JANIS: From Albon Values Corporation. 
THE WITNESS: I don't know. 
MR. JANIS: What is the date? 
THE WITNESS: 17 of April. 
BY MR. NIELDS: 
Q Next item. 

A Do yoiihave any back-up documents? It is a small 
cash withdrawal. 

MR. VAN CLEVE: This is H-187 that is being shown to 
Mr. Hakim. There is a notation appearing to be a CSF notation, 
"to cover withdrawal in cash of A.H." 

THE WITNESS: And it comes from Hyde Park. I would 
say — this is what, Ap/J-l^.I ^'Jft'J^i^frlrt^'K*'^ ha.we gotten 
organized by then. 




496 



UNCUSSIRED 



141 



I would allocate that to the Iranian expense. I 
don ' t know. 

BY MR. NIELDS: 
Q Okay. You are not certain, but you think it is 
Iran? 

A Yes. 
Q Next item. 

A Just judging from "Hyde Park". The 15,000 — do you 
have a back-up document on that? 

MR. ZANARDI: Yes. 

MR. VAN CLEVE: H-903 that should be, that Mr. Hakim 
is being shown. 

THE WITNESS: Yes. 

MR. VAN CLEVE: Dated 4-17-86. 

MR. ZANARDI: I have the two of them that were 
together. They are both 4-17. 

MR. VAN CLEVE: The witness is being shown now H-187 
as well as H-903. 

THE WITNESS: What was that chart, what was 
Albon for? 

MR, NIELDS: That was ^ ^ej^ji^ ^erican operating 
company. 

THE WITNESS: I don't know. Beats me really. If 
it is the same day, they have made transfers and they show it 



mmr 



has gone through my pipeline f 



rom two dj f f « 



497 



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 



142 



UNCUSSIRED 



me, indicates that that should be charged to, Albon should 
be charged to the contras and the Hyde Park, 3,000, should be 
charged to Iran. That is the only conclusion that I can 
come to. 

BY MR. NIELDS: 
Q Next one, cash, Passeport U.S. 

A Absolutely no understanding why they need Passeport 
U.S. 

Do you have something there? 

MR. VAN CLEVE: I am showing Mr. Hakim H-99. There 
is a term spelled p-a-s-s-e-p-o-r-t. Does that help at all? 

THE WITNESS: No. 

MR. VAN CLEVE: I thought it might be the same. Do 
you recognize that signature, if that is what it is, on this 
document? 

MR. JANIS: Looks like T. Clines'. 

THE WITNESS: Tom Clines would never put his right 
signature on any piece of paper. 

MR. JANIS: That is what it looks like, though. 

THE WITNESS: Not him. No. What is this? It 
doesn't really help me. 

MR. VAN CLEVE: Okay. 

MR. JANIS: What date is~that", I awTcariou's- 

MR. VAN CLEVE: From Albon Value, April 17, 1986, 




498 



143 



ONCUSSIflED 



BY MR. NIELDS: 
Q The answer is you don't know what thatlis about? 
A No , I don ' t . 

Q Okay. The next one, $26,490 on May 20, that is part 
of a 30-30-30-10 split. 

A Then it must be profit distribution for my benefit. 
Q Next one is $10,000, sub-account one. 
A You have to see what that sub-account is when we 
get the additional documents. 

Q From CSF you are talking about? 

A From CSF, yes. 

Q All right. We eagerly await that. 

MR. JANIS: Let's go off the record. 
(Discussion off the record.) 
MR. NIELDS: Let's keep going. 
BY MR. NIELDS: 
Q The next item is a $60,300 item. 
A Do we have any — does that correspond to any 
profit distribution date? 
MR. POINTS. No. 
MR. NIELDS: Show him that. 

MR. VAN CLEVE: This is H-17 5 we are showing Mr. 
Hakim. I wonder if that jogs your memory. If you know, 
Mr. Hakim, were redactji^pg Jii4de_ ij^ ^he_docurnent before it 

was produced to us? 




499 



yNcussm 



144 



Have you ever seen that document in a different 
form? 

THE WITNESS: This is the first time I have seen this. 
I don't know what this blacked-out area is. 

I don't see any annotation, any remarks on this 
document that would help me. Sorry. 
MR. VAN CLEVE: Okay. 
BY MR. NIELDS: 
Q This is just about at the time of the McFarlane 
trip to Tehran. 

A You are talking about this $60,000 amount? 
Q Yes. 

A I don't know. 

Q In any event, we got another one you may be able 
to remember, $500,000. 

A That I remember. 
Q Okay. '. 

A This is another A.H. sub-account that was set aside 
for investment purposes. It was not part of the reserve. It 
was money set aside in anticipation of profits to be made or 
we were making ahead of time and we were going to make the 
investments that we talked about earlier for the benefit 
of STTGI , Richard and I. It should have come from this. 
Q So this should be a set aside? 



A It should be a set aside for Sci 



DNCUISSIFIEI) 



Tech. 



500 



UNCLASSIRED 



145-150 



MR. JANIS: Their question is, are you saying 
it should have gone into the SciTech sub-account or 
another sub-account as a set aside for an investment? 

THE WITNESS: Earlier I said that it is an A.H. 
sub-account set aside for investment. Then I went further to 
explain that this investment was for the benefit of STTGI. 

BY MR. NIELDS: 
Q So ~ 

A And I have further explained the previous testimonies 
that I made in connection with the wood deal and so forth. 

MR. VAN CLEVEL: This is the — 

THE WITNESS: Technically, CSF should have drawn the 
monies for those investments from this sub-account. Whether 
they did that or they didn't, I don't know. 



U 



NCUSSIHED 



501 



ONCUSSIRED 



151 



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 it be correct to say that you are setting 
aside enterprise funds here to make some adjustments 
through SciTech? 

A Yes. 

BY MR. NIELDS: 

Q I know you have answered this three times. 
SciTech is the offshore mirror of STTGI , is that correct? 

A That's correct. 

Q So this is $500,000 that is taken out of the 
enterprise for the benefit of you and Mr. Secord 
equally? 

A Eventually. 

Q Was Secord aware of this transfer? 

A I'm not sure. I don't think so. I am not 
sure. You mean set aside? 

Q Yes. 

A By transfer, you mean set-aside? 

Q Set-aside. 

A I don't know. I don't know whether I told 
him or not. 

Q The next item is $10,000. 

A Lou, do you have any background on that? 

Q I would like to go back to this $500,000 
item. Out of what_ fujid^. ^je^^^ttA^^tf '°°0 set-aside 
made? 




502 



UNCLASSIFIED 



152 



1 
2 
3 

4 
5 
6 

7 

e 

9 
10 

11 

12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



A From the accounts of various companies, I don't 
know from which account they had the money. I can't 
recall at this time. Most probably from Hyde Park. 

Q I take it it was not out of the commissions on 
the arms sales to the contras? 

A The document should reflect that. I really 
don't know how CSF handled it. It is possible, and yet 
it could have come out of, for instance, Hyde Park. 
Q It could have come out of the Iranian — 
A It could, yes, very possible. 

Do you have a reflection from the bank accounts 
showing that kind of transfer at that time? 

MR. ZANARDI: This is a CSF New York bank 
statement. 

THE WITNESS: CSF New York. 
MR. ZANARDI: Right, and what it shows — 
THE WITNESS: Are you talking about National 
Republic? 

MR. ZANARDI: Right. What it shows, it shows 
the $500,000 coming in, the $500,000 going on call from 
Compania, it goes in under Compania account, and 
eventually it gets transferred over to the investment 
account . 

MR. VAN CLEVE: .When _^ou_5^ "eventually," 
how long? 




503 



^ 



^ 

^ 



UNClASSiriED 



153 



1 MR. ZANARDI: 7-18-5-23. 

2 THE WITNESS: Lou, are you telling me the money 

3 leaves Switzerland, goes to New York, and comes back to 

4 Bermuda; is that what you are saying? 

5 MR. ZANARDI: No. It went into the New York 

6 account. They have two accounts. They have one for 

7 their Bermuda transactions and one for their Swiss trans- 

8 actions. The one for their Swiss transactions is the 

9 Compania account. The one for the Bermuda account is 

10 called CSF Limited, and it went from the Compania account 

11 into the limited account. 

12 THE WITNESS: But still in New York? 

13 MR. ZANARDI: Still in New York, and eventually 

14 it gets all pulled out with all that other stuff in 

15 December of 1986. 

16 THE WITNESS: I see. That is the way they 

17 invested it. 

18 EXAMINATION BY THE HOUSE SELECT 

19 COMMITTEE 

20 BY MR. VAN CLEVE: 

21 Q Mr. Hakim, I think it is possible that you 
may not have understood Mr. Nield's last question about 

23 the origin of the funds that went into this $500,000 

set-aside, so I want to ask you a little further about 
that. I think Mr. Nields was asking you wl^ether or not 



504 



UNCUSSIFIED 



154 



1 you regarded this essentially as a distribution of your 

2 previous profits from the contra arms deal, or whether 

3 the money came from some other source, the $500,000. 

4 MR. JANIS: Do you want him to repeat the 

5 question? 

6 THE WITNESS: I understand the question, but 

7 I thought I had answered it. Let me see if I can be more 

8 precise. 

9 The money could have been invested from the share" 

10 of the profits from the contra deals, and I said it is also 

11 possible that either in part or in total have been taken 

12 from other accounts such as Hyde Park. I used that as 

13 an example, in anticipation of the profits that we were 

14 entitled from the Iranian arms sales . We did not make 

15 any distinction. 

16 The focus was to set aside money for investment, 

17 so how CSF reached out into the different accounts that 

18 they had I don't know. That is why I am saying that if you 

19 go back to the bank accounts, see where they got it, we 

20 can get the answer . 

21 BY MR. NIELDS: 

22 Q But I take it that it may well be, as I under- 

23 stand your answer, that there were no undistributed profits 

24 from prior contra arms sales at that time? 

25 A The profits were distributed, but they were not 



UNCLASSinEO 



505 



16 
17 
18 
19 
20 
21 



25 



UNCLASSIFIED 



155 



necessarily set aside. The moneys could have been 

2 invested. 

3 Q Are you saying that there was still left in 
the enterprise at least $500,000 in commissions that had 

5 not yet been put into the capital accounts? 

6 A I didn't say at least $500,000. I said could 
have been some money left there, and it is also possible 

^ that it was an overdraw from other accounts . 
® We did not focus on that. At that time the 

focus was on SciTech's STTGI. 

Q Getting the $500,000? 

A Getting into the business of investment, so 



13 we did that, and the thought, the rationale, was that 
■"^ they either had moneys still not set aside — I'm not 
15 



saying not distributed. I distinguish between setting 
aside and being distributed. To set that kind of money 
aside that we thought we needed for the various invest- 
ments, if you recall my testimony, they asked me how much 
money I thought we needed for all this investment. I said 
I thought maybe about $350,000. Do you recall that 
testimony? So we had set aside $500,000 for any possible 



22 investment that STTGI would have needed. 

23 If you are focusing on whether there was a 
2^ distinction at that time between the various moneys that 

we had, the answer is no. 



UNCLASSIHED 



506 



UNCLASSIFIED 



156 



1 Q Were you advancing it, so to speak, into this 

2 set-aside account, against commissions that you would 

3 earn in the future on contra arms deals, or were you 

4 setting it aside out of Iranian money? 

5 A All the above. 

6 MR. JANIS: I think what he is trying to say 

7 is they set it aside. There may well have been some money 

8 on contra arms sales that had not yet been distributed 

9 that was part of the set-aside, or there may have been 

10 money anticipated on contra arms sales that they were 

11 going to use for that purpose, or there was money that 

12 they anticipated making a profit on the Iranian arms 

13 sales, and that money could have been represented there 

14 too. 

15 Is that right, Mr. Hakim? 

16 THE WITNESS: You are absolutely correct, but 

17 you have to understand where I come from. Where I come 

18 from was not what is available in the pot. I am coming 

19 from we need this much more for investment. 

20 BY MR. NIELDS: 

21 Q And you were going to get it from_wherever 

22 you could get it from? 

23 A If you like to put it that way, yes. 

24 MR. JANIS: And the money was there. 

25 THE WITNESS: The money was there. That is 



ing to get it from wherev 

iciAssra 



507 



20 
21 
22 
23 



UNCUSSiriED 



157 



what I am trying to say. In one way or another, we 
deserved it. Either it was earned, or it was about to 
3 be earned. 

If you will, you are talking in bank terms. 
We had that much credit with the enterprise, 
g BY MR. NIELDS: 

1 Q I just want to make it absolutely clear because 

you have been very explicit that you were going to take 
for personal use certain commissions on sales of arms to 
the contras, but unless I have misunderstood your 
testimony, you have never clearly stated that you at that 
point in time were going to take any money for personal 
purposes out of the Iranian arms sales. 

A You are not completely correct. I have 
already several times testified that I had the concurrence 
of all the principals that I was going to get. 

MR. JANIS: His question is this. This was 
in May of 1986, not in August or September of 1986. 



,g BY MR, NIELDS; 



Q That is precisely my point. You had 
testified in August and September of 1986 that you 
received the concurrence of all the principals that you 
would eventually be properly compensated for the second- 



24 channel transactions? 



25 



A By then — 



UNCLASSIFIED 



508 



UNCLASSIFIED 



158 



1 Q This is in May of 1986, and what I am asking 

2 you is whether you in your own mind at that point in time 

3 were saying I am going to set aside or I am entitled to 

4 set aside for my own personal use and benefit $500,000 

5 out of the Iranian arms transactions? 

6 A That is not the way I looked at it . I looked 

7 at it that I needed to set aside $500,000. I did not 

8 have an exact accounting of what was available from the 

9 contra deals, but I needed the $500,000. I could have 

10 very well overdrawn that money into the Iranian arms . 

11 Did I answer your question? 

12 Q Almost completely, but not completely. 

13 Are you saying that you felt that you could 

14 dip into this money, so to speak, and set it aside for 

15 your and Mr. Secord's personal use, because you anticipated 

16 that there would eventually be commissions due you out of 

17 sales to the contras? 

18 A I have been trying to say my focus was on 

19 having that much money for our^ £ersonal_investment. That 

20 was the focus. 

21 And, again, I have to refer you back to my 

22 earlier explanation about this animal with so many 

23 different identities. I knew I needed this much money 

24 for investment. I also have in my mind the understanding 
that we are a private enterprise. I say that there is 




25 



509 



UNCLASSIFIED 



159 



1 money from the contra deals that still is due. There is 

2 work that I have done already-- I eun not talking about 

3 the second channel — for the Iranian initiative. We are 

4 at one point called that we are a private organization. 

5 As part of this confusion, and the tact that my motivation 

6 was to have $500,000 set aside for investment, I reached 

7 out and put the moneys there. Is it clear? 

8 Q That is an answer. It is as clear as it is 

9 going to get right now, I think. I understand. Now, 

10 have we already done this $10,000? That is the one 

11 immediately under the $500,000. What is that for? It 

12 is the 27th. Do you have a back-up document on that? 

13 MR. JANIS: H-503, but it has no notation of 

14 any kind. 

15 MR. NIELDS: Just cash, I think. There isn't 

16 any back-up on that. 

17 THE WITNESS: So I wouldn't know. 

18 BY MR. NIELDS: 

19 Q The next one is $79,167. That is another 

20 part of a 30-30-30-10 split. I take it that means it 

21 is profit distribution to you? 

22 A Correct. 

23 Q The next one, $2 million. 

24 A It is the second $2 million set-aside, and 

25 it says CSF account 2 . I suppose that it is an AH 



UNCLASSIFIED 



510 



1 



19 



UNCUSSIFIED 



160 



subaccount. It is the reserve, the second $2 million 

2 reserve money, the same as the first item, the first 

3 $2 million. The reaction is the same. The answer is 
* the same. 

^ Q And why is it done then? 
^ A Exactly the same method. General Secord asked 

me to do that and that is what I did. 
^ Q Once again this happens a couple of weeks 
^ after the plane has flown the mission? 

A But again was the money in CD prior to that? 
Q Yes, it was. 
A The same pattern. 

Q So that after the plane flew the mission, you 
took the money out of the C. Tea anc^ut it in the 

15 reserve? 

16 A Yes. 
■•7 Q Is that it? 
18 A Yes. 

Q Mr. Van Cleve is bursting to ask questions. 



20 BY MR. VAN CLEVE: 

^l o From what I can see, this document H-141 

22 is the document that covers both the $2 million trans- 

23 action and the $200,000 transaction occurred the same 
24 



25 



day, June 18, and I wonder if you might 2>f ^^ ^°. 
explain what the $200,000 was for. 



might be able to 

UNCUSSIFIED 



511 



10 



UNCLASSIRED 



161 



1 A You are jumping ahead of us, right? You are 

2 going to the next item? 

3 MR. POINTS: Subaccount 3. 

4 BY MR. VAN CLEVE: 

5 Q It is the next item on your sheet, but it is 
^ the same transaction according to document H-141. 

7 A I understand that. 

8 Q The same date. Does that help you at all in 
3 terms of the circximstances? Why was it split up into 

two amounts, I guess is the question. 



11 A Why is it split in two accounts in the ledger? 

■■2 Is that what you are saying? 

13 Q In the ledger, yes, even though it appears 

^* to have been part of one transaction. 

15 A You are asking me why — this is from the bank, 

■•^ isn't it? You are asking me why CSF made one transfer 

^7 and then in their books allocated it to two accounts? 

18 Q Yes. 

19 A I don't know. 
201 Q You don't know. 

21 A It seems to me simpler instead of making two 

22 transfers. It all depends where the moneys went. This 

23 money went — is the destination of these two amounts the 
2* $2 million and the $200,000 the same place? 
25 MR. POINTS: CSF Bermuda. 



ne place? 

UNCLASSIFIED 



512 



UNcussm 



162 



1 THE WITNESS: So the answer is, it is simpler, 

2 costs less. The dates are the same, so they made the 

3 transfer, but the allocations were in their ledger for 

4 different purposes. 

5 BY MR. VAN CLEVE: 

6 Q You don't have any additional information about 

7 what the $200,000 allocation was for? 

8 A No. It says account 3. I really don't know. 

9 All I can tell you, that I recall instructions, and a good 

10 possibility of three fiduciary agreements, each for 

11 $2 million and one for $500,000, one has to look at those 

12 documents. What is subaccount 3, I cannot recall at this 

13 time. 

14 BY MR. NIELDS: 

15 Q But that is another personal distribution 

16 to you? 

17 A That is not what I am saying. 

18 MR. JANIS: It goes into one of these sub- 

19 accounts that were set up for various purposes. 

20 BY MR. NIELDS: 

21 Q Is it a reserve? 

22 A In general terms reserve, but "1 3o not~want 

23 you to confuse that with the reserve in the organization 

24 chart that I showed you, so one has to look at the sub- 

25 account and see. It is a set-aside. It is a reserve 




513 



UNCLASSinED 



163 



1 for what purpose, like the set-aside of the $500,000, 

2 I told you it was for investment, but I do not recall 

3 at this time having instructed CSF to set aside 5200,000 

4 for any particular purpose that I had in mind. 

5 Q Mr. Hakim, I don't want to put words in your 

6 mouth, but I want to ask you this question. Was there a 

7 sense in which these two, $2 million reserves were your 

8 way of setting aside money for you and Mr. Secord at some 

9 time in the future after this Iranian initiative had run 

10 its course? 

11 A My way you said? 

12 Q Yes. 

13 A I have to go back and repeat the testimony 

14 that I have already made. Reserve for corporation meant 

15 for any purpose. We needed to have a financial backbone. 

16 It could have been for operational purposes. 

17 I testified about Ollie's way of doing things 

18 and so on. This is more of the same thing. I have 

19 testified. And you recognize at this time we are still 

20 in the midst of operations. 

21 Q Okay, fine. You have answered the question. 

22 I am not trying to get you to repeat your testimony. 

23 The next item is also part of one of those 

24 30-30-30-10 splits, and I take ^it therefore^ represents 
a profit distribution to you. 



25 



ce it therefore represent! 

UNCUSSIFIED 



514 



12 



UNCLASSIFIED 



A Yes. We went over that yesterday. 

2 Q The same is true on the $258,398 transfer? 

3 A We went over that yesterday as well. 
* Q That is a profit distribution to you? 

' A If the dates correspond. The figur'is I 
6 recall — 

^ MR. JANIS: That is the one we went over. 

THE WITNESS: Yes. 
BY MR. NIELDS: 
Q It is part of the 30-30-30-10? 



^^ A That's correct. 



Q How about the $250,000 item on October the 



164 



13 34d, 1986? 

^* I MR. JANIS: Looking at CRS-0650? 

■•5 I MR. ZANARDI: Could I just lead you through 

1^ that real quickly? I think it will save time. 
17 The $257,000 is transfers to CSF New York. 

IB $250,000 is removed from that account, and then $25,000 
is supposed to go to STTGI . 

Then there is three transactions, or maybe four, 
that go to^l^^^^^^^l^K totaling zUsout $150,000, 
and $50,000 goes to — 

THE WITNESS; Aren't these for the purchase 
of the aircraft? 

MR. ZANARDI":" No. If you look at the date. 



UNCLASSIFIED 



515 



BNCUSSIFe 



165 



1 it is August — October. 

2 MR. JANIS: What is your theory? 

3 MR. ZANARDI: My theory is that it goes to the 

4 contras. 

5 THE WITNESS: That is what I am trying to say. 

6 Didn't we buy aircraft for them then, the 123s, or paid 

7 for them? 

8 MR. ZANARDI: No. No. 

9 MR. JANIS: What we have here, he has got a 
bunch of checks going to ^^^^^^^^^^^H right? 

11 THE WITNESS: Because I recall a delay in 

12 payment for the aircraft. I may very well be off. Do 

13 we have a date when we bought those 123s? 

14 MR. ZANARDI: I have those checks. 

15 MR. JANIS: You have got Bermuda. 

16 THE WITNESS: Is it possible this happened 

17 during the time we were trying to close the operation 

18 and these were the payments we made to try to close the 

19 operation? 

20 MR. ZANARDI: Right. 

21 THE WITNESS: That is probably contras. 

22 MR. ZANARDI: That is one I was pretty sure of. 

23 BY MR. NIELDS: 

24 Q This is contras? 

25 A To close down the contra account and operations. 



yNCLASSinED 



516 



UNCLASSIFIED 



166 



1 Easy target, just charged me for it. 

2 (Discussion off the record.) 

3 BY MR. NIELDS: 

* Q Back on the record. 

5 I have asked you to turn to H-96, which is 

6 headed "Korel assets." 

7 A Yes, sir. 

8 Q I take it this is the account Korel assets 

9 stands for the Secord capital account? 

10 A Yes, sir. 

11 Q And I take it the first figure, 22,000, you 

12 are not going to be able to help us on? 

13 A No. 

14 Q The next one, 165,000, you have already 

15 testified about, because there was a corresponding 

16 165,000 to you, and I think you indicated that you 

17 believed that would be an equal distribution of profit. 

18 The next one says "transfer to Khalid Rashid" 

19 in the amount of $31,817, and there is down below a 

20 corresponding offset of the equivalent amount. Do you 

21 know what that is about? 

22 A I think I do. First of all, let me tell you 

23 who Khalid Rashid is. An ex-Saudi pilot and associate 

24 and friend of General Secord whom I met through Richard, 
and a person who was also involved in assisting us with 



ne equivaxen^ ainounx^. uc 

UNCLASSIFIED 



25 



517 



UNGLASSIFIEO 



167 



1 the sales of Marwais shelters to the Saudis, who started 

2 a consulting firm, and he went through all kinds of 

3 negotiations to go into some sort of a partnership, even 

4 rented offices for that purpose, and he is also in Saudi 

5 in the business of he sells cars, various and different 

6 kinds of makes. This was a used car that Richard bought 

7 from him, and he agreed to lend him the money and take 

8 it out of the joint venture we had. I saw the money 

9 being there, and I paid for it. I didn't think that it 

10 would be a good negotiating position with someone who is 

11 trying to go into partnership with us to have an edge 

12 over us such as I have done you a favor, so I wanted this 

13 to be paid off. How they have done this thing, this 

14 should not have been offset. It should have paid the man 

15 for it. If he returned the money back, I don't know. 

16 Q What kind of a car was it? 

17 A It is a Porsche, a used Porsche. 

18 Q And was it in the United States? 

19 A It was shipped to the United States, yes. 

20 Q And to your knowledge, Mr. Secord kept the 

21 car? 

22 A I really don't know what he did with it. 

23 Q He didn't returr 

24 A No. No. No, I know the car came to the United! 

25 States was modified to fit the U.S. requirements and so 






518 



KNMSm 



168 



1 forth. All that I know, but I don't know what he did 

2 with it. 

3 Q But it was for Secord, not for you? 

4 A That's correct. 

5 Q And you don't understand the offset at all? 

6 A No. 

7 Do we have any record how this thing was 

8 offset, where the money came for this? 

9 MR. ZANARDI: I saw it was an offset. I didn't 

10 pay any attention to it. 

11 BY MR. NIELDS: 

12 Q The next item is a cash withdrawal, $7000. 

13 Would it be fair to say you don't know what that is 

14 for? 

15 A That is fair. You don't have any back-up 

16 documents for this, do you? 

17 MR. ZANARDI: All we have is this statement 

18 signing for it. 

19 THE WITNESS: Signed by who? 

20 MR. ZANARDI: Richard Secord. 

21 THE WITNESS: Oh, that is his signature? 

22 I don't know. 

23 BY MR. NIELDS: 

24 Q The $45,000 to Tom Green, do yoji know whether 

25 that is the finder's fee? 



Green, do you Know wnetn 

UNCI mm 



519 



UNCUSSIHED 



169 



1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 



The finder's fee I don't think came from us. 

You think that came from? 

The Canadian. 

The Canadian company? 

I think so. 

Is this the loan? I think you may have 
testified that you thought it was the loan. 
A I don't remember. 

MR. JANIS: Off the record. 

(Discussion off the record.) 

THE WITNESS: I don't know what that is. Do 
you have any back-up documents, any invoices? 

MR. JANIS: What is the date? 

MR. NIELDS: April 10, 1985. 

MR. JANIS: Was there a Transworld Arms ship- 
ment around that time? 

MR. NIELDS: Yes. The problem is that they 
were paid earlier, but the shipment took a while to 
get there . 

THE WITNESS: I don't know what that is. 

BY MR. NIELDS: 
Q The next two are $101,926 and $118,336. 
A Are there any back-up documents? 

MR. ZANARDI: Just the bank statement. 

THE WITNESS: No signatures, no annotations. 



HED 



520 



UNCLASSra 



170 



1 no markings? 

2 MR. ZANARDI: Bermuda again. 

3 THE WITNESS: More of the same thing. 

4 MR. ZANARDI: Is that a set-aside investment? 

5 THE WITNESS: It is more of the same type of 

6 banking transaction that appeared on Albert Hakim. 

7 BY MR. NIELDS: 

8 Q I take it that transfers in these amounts 

9 into his capital account would logically be part of his 

10 share of the commissions on arms sales to the contras? 

11 A That makes sense. 

12 Q There are a series of cash withdrawals. There 

13 are about seven of them, and in general, I take it your 

14 answer would be you don't know what they represent. 

15 A In my copy of this thing I have asked a 

16 question, does the cash withdrawal by — who withdrew 

17 these? Does it say? 

18 Q All we have is a transfer account. 

19 A No, I don't know. 

20 Q One of them says cash withdrawal Masudi . 

21 A I do know that. 

22 Q What is that? 

23 A That is contra, definitely. This is the 

24 con artist who I think is in jail. 

25 Q And then there is $100,000 and $800,000 



UNCUSSIFIED 



521 



UNCUSSIRED 



171 



1 profit distribution phase 4. I take it that is profit 

2 distribution on the arms sales to the contras? 

3 Then underneath that on February 13, there is 

4 $35,000 to A. Green. Do you know who A. Green is? 

5 A I think I do. 

6 Q He is the — 

7 A Rich guy. 

8 Q British guy who sells Blowpipes? 

9 A Yes. It should be charged to contras. 

10 Q That should be an expense, I take it, not 

11 a distribution account or capital account? 

12 A Right. 

13 Q I'm sure you don't know the precise reason 

14 for the transfer to Sharf, Green and Langford, but I think 

15 you speculated yesterday it was an expense payment. 

16 A This should be a contra and there should be an 

17 invoice, a Udall transaction. 

18 Q The next item is $28,111. 

19 MR. ZANARDI: Here is the back-up on that. 

20 MR. NIELDS: It goes to Montero through 

21 Republic? 

22 MR. ZANARDI: Yes. 

23 THE WITNESS: Okay. So you have that. 

24 MR. JANIS: I am speculating here, but I think 
you might want to put this on the record anyhow. 



UNCLASSIFIED 



25 



522 



Efiiftssra 



172 



1 MR. NIELDS: You want to put it on the record? 

2 MR. JANIS: Yes, I do. Some of these cash 

3 transactions in this Korel account are plainly things 
* that were operational expenses. There seems to be a 

5 good deal of back-up for the Korel — in the instances 

6 of Korel, when this fund was used for operational 

7 expenses, and there is less back-up with respect to the 

8 Hakim accounts, and I suspect the reason for that may be 

9 that the CSF felt a great need to back things up when 

10 they were distributing money through Secord or through 

11 Korel assets than they would have with their direct 

12 customer Hakim. 

13 I realize that is speculating, but it becomes 
1* more apprent to me when I look at the back-up of the 

15 Secord transactions. 

16 BY MR. NIELDS: 

17 Q Do you know who Madam Barbara Carolina Maurer 

18 is? 

19 MR. VAN CLEVE: Is that Madam or Mademoiselle? 

20 MR. NIELDS: I thought Mademoiselle was Mmle. 

21 It is November 12, 1985 cash transaction. 

22 MR. JANIS: Do you have some back-up that you 

23 can show him? You are looking at H-596. 

24 THE WITNESS: This_ is Jiichar^' 5. signature? 
So what is the question? 



25 



is is Richard's signature 



523 



iJNCLASSIHED 



173 



1 The only thing that is familiar to me from all 

2 this, there is a receptionist in CSF that I know her by 

3 the name of Carolina. If this is the rest of her name, 

4 I don't know. It is possible that she went and cashed 

5 it. 

6 BY MR. NIELDS: 

7 Q Of the remaining five entries, four of them 

8 are part of these 30-30-30-10 splits. I take it those 

9 would represent Mr. Secord's share of the commissions on 

10 arms sales to the contras? 

1 1 A Okay . 

12 Q I take it that is correct? 

13 A Yes. 

14 Q And then there is just one unidentified item 

15 of $2,305.32, and that has an offset, and so I don't 

16 need to ask you about that. 

17 MR. WECHSLER: The offset is a penny off. 

18 BY MR. NIELDS: 

19 Q Actually I do. Who is Pat Buchinger? Do you 

20 know the answer to that? 

21 A Yes, I do. 

22 MR. JANIS: It is not Pat. 

23 THE WITNESS: It is not Pat. 

24 MR. VAN CLEVE: We are alad tg, y 

25 are thorough, Mr. Janj 



irVE : We ^ are aj.ad ta sj 




524 



UNCUSSIFIED 



174 



1 THE WITNESS: Nothing of big substance. 

2 BY MR. NIELDS: 

3 Q Is this the Continental Bank in Brussels? 

4 A This is the money that was paid to a clinic 

5 in Germany, which is a health farm, a fat farm, if you 

6 will. Seriously, I was very much concerned about the 

7 health of Richard. He was under a lot of pressure, and 

8 I wanted him to take some time off, and I know this clinic 

9 very well. I have been using it for many years, so I 

10 sent him there and confined him to that place. They 

11 charged his accounts, and I said, "No, the company will 

12 pay for it." That is why it was offset, so it is a health 

13 benefit, and he was not alone, by the way. Tom Clines was 

14 with him. 

15 BY MR. VAN CLEVE: 

16 Q Is Tom Clines a fairly tall individual? 

17 A Yes, he is tall, tall and fat. 

18 Q Fat also? 

19 A yes. He is quite a character. You can get 

20 to like Tom. You will see the same transaction in 

21 Tom Clines' col»amn. We look after our employees. 

22 BY MR. NIELDS: 

23 Q We are almost f inished~wTth'EIi^ 'mone"7T5'usiness , 

24 but not quite. There are a number of transfers, most of 

25 them out of the — 



}k arter our employees . 



525 



UNCUSSIFIED 



175-180 



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 



A Where are we now? Still on Korel, or finished 
with that? 

Q We are finished with that. You don't need to 
refer to this document. 

There are a number of the transfers reflected 
on the C. Tea register, which is in front of you. 

A You want to go to the next page? 

Q Are to the Continental Bank in Brussels. 
Do you know why that is the case? 

A I have no knowledge whatsoever about Mr. Clines 
banking movements. I really don't. He handled it 
himself. He dealt directly. I know very little, almost 
nothing about how he operates . 



HNCUSSffl 



526 



Boyum/bp-l 



UNCLASSIRED 



181 



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 



CSF 

MR. ZANARDI: He dealt directly with 0^7 
MR. HAKIM: Yes. 
BY MR. ZANARDI: 

Q Okay. 

A When you say dealt directly with CSF, the only 
thing he had to do was to instruct CSF what to do with the 
profits or the commissions that were taken. 

Q But you directed how to make the payments for 
Defex. 

A Yes and no. You are asking an operational 
question or a financial question? 

Q Operational question. 

A Let's answer separately. 

Q Okay. 

A Financially he had no authority whatsoever in 
any way or form to the contrary. He had told CSF that 
no transfers to be made ordered by Tom Clines unless it is 
approved by me. Operationally he could not — we could not 
have a man out in the field dealing with, you know, sensitive 
situations and telling him that we wanted to monitor him. 
But I couldn't have that much — we were sloppy, but I 
couldn't allow it to be — to get that much sloppy that too 
many people would instruct the same financial network to do 
things. 

So whenever he instructed, if he did, CSF to do 



d instruct the same finar 

UNCUSSIHED 



527 



ONcussm 



182 



1 something they always called me, checked with me, got my 

2 approval then moved. It was an arrangement — we didn't 

3 want to recognize the both. 

4 MR. NIELDS: To your knowledge did any of the 

5 money of the enterprise ever go to the benefit, personal 

6 benefit of Oliver North? 

7 THE WITNESS: Not under my instructions and 

8 not to my knowledge. 

9 MR. NIELDS: Did you ever hear that that happened? 

10 THE WITNESS: Pardon me? 

11 MR. NIELDS: Did you ever hear that that 

12 happened? 

13 THE WITNESS: No. 

14 BY MR. NIELDS: 

15 Q No one ever told you that that had happened? 

16 A No. 

17 Q Was it ever contemplated? 

18 (Witness confers with his attorney.) 

UNCLASSIFIED , 

20 Q And who participated in this contemplation? 

21 A I would say that I — in my opinion I was the 

22 key operator in that idea. If you recall when we were 

23 talking about the Button set-aside and I was very confident 

24 when I testified that it could not have been Dutton, 

25 and I also testified that this set-aside should have had 



528 



UNClASSinED 



183 



1 interest added to it. 

2 I had contemplated to use the interest of that 

3 money to help out with the university expenses of Oliver 

4 North's child. I don' t know whether it was a son or 

6 daughter. However, I knew it was a very sensitive area 

6 to get into. I believe I told Secord about it. What I 

7 recall is he said he didn't want anything to do with it. 

8 I asked Zucker to see if he could find a legal way to help 

9 with the university expenses of his child. 

10 I managed to get Mrs. North, whom I have 

11 not met, to meet Bill Zucker during one of his trips that he 

12 made to the United States. I believe it was in Philadelphia 

13 with a law firm that he deals with. To the best of my 

14 recollection he called and met, I believe -- this is what 

15 I recall from what Mr. Zucker told me — that it was all 

16 done on the phone or what, but I think they met and he got 

17 acquainted with the family, the structure, who the kid 

18 was, and what was involved. 

19 The bottom line was that Zucker told me that he 

20 could not think of any legal way of achieving that objective. 

21 That was aborted. 

22 Q Did he t§\^ you_that_ there was no legal way or no 

23 feasible way? 9f»nPii 

'i « Vi 

24 A He advised me not to get involved. Not to do it. 

25 Q For whatever reason. 




529 



KNCUSSm 



184 



1 A I constituted that to mean that that was not 

2 the right thing to do. 

3 Q Had you discussed this with North? 

4 A I don't recall if I have. I don't believe I 

5 did. 

6 Q Did you discuss it with anyone other than Secord and 

7 Zucker? 

8 A I don't believe that I have, no, no. 

9 Q I take it from what you have said that you 

10 understand that Zucker talked to Mrs. North about it? 

11 A Yes. 

12 Q And what did he tell you about that conversation? 

13 A He did not feel comfortable about the whole 

14 thing. 

15 Q Zucker? 

16 A Zucker, 

17 Q How about Mrs. North? 

18 A I don't know what transpired between the two. 

19 Q What caused you to make a decision to see if you 

20 could do this for one of North's children? 

21 A I think what prompted me was when I heard, I 

*22 don't know whether it was Secord or it was from him or both, 

23 I don ' t remember — 

24 MR. JANIS:'' ^oiT'have To~say who you mean by "he. 

25 THE WITNESS: North. I believe there was a time 




530 



UNCLASSIFIED 



185 



1 that I beceime aware that North was in;\very awkward situation 

2 with his family. He was not spending time with his family. 

3 He was not attending to the family and I even heard that his 

4 wife was contemplating to separate from him and he was 

5 not attending to the kids, school, education, and I have 

6 a lot of respect for North. I really like that man and 

7 consider him a good soldier. 

8 I thought if I could find a way to help out and 

9 maybe reduce the tension that would be a good move. 

10 Q Did he indicate that part of the tension was the 

11 cost of educating his child? 

12 A I really don't remember that. I don't recall 

13 that, Mr. Nields, in that context. I remember the tension. 

14 MR. VAN CLEVE: You say you became aware of 

15 his personal family situation. Was that ^ because he told 

16 you about it or because Secord told you about it? 

17 THE WITNESS: I believe it started by Secord 

18 telling me this. I think when it started out I — I don't 

19 remember the dates. 

20 BY MR. NIELDS: 

21 Q Here is what I am having trouble with, I take 

22 it Zucker doesn't know or didn't know North or Mrs. North? 

23 Is that true? To your knowledge? 

24 A Oh, after he met Mrs. North — 

25 Q Until he met Mrs. North in Philadelphia..^ 



UNCLASSIFIED 



531 



UNMSm 



186 



1 A He did not know, yes, did not know her. 

2 Q But you did. 

3 A Mrs. North, I have not, no. 

4 Q But you knew North? 

5 A Yes. 

6 Q And at your request Mr. Zucker goes to Philadelphia 

7 to meet with Mrs. North on the — 

8 A No, no, Mrs. North goes to Philadelphia to meet 

9 with Mr. Zucker. Mr- Zucker does business there. He has 

u 

10 an attorney that deals with his activities in Forway. 

11 Q And had you spoken to Mrs. North about this 

12 possibility? 

13 A I don't believe I have, no. I don't recall. 

14 Q Well, — 

15 A I don't recall. 

16 Q To your knowledge who did? Did Secord speak to 

17 Mrs. North about this? 

18 A I don't know that, but I believe, if I am not 

19 mistaken — I believe what I told Zucker to say was that so.-ne 

20 people who don't want to identify themselves wanted to help 

21 out. I think that is the way I told Zucker to approach them. 

22 Q In other words, to the best of your knowledge 

23 it was Zucker who approached the Norths. 

24 A Effectively, yes. 

25 Q Without any advance warning from eit"her~you or 




532 



IINCUSWD 



187 



I can testify about myself, about Mr. Secord 

Did you ask Mr. Secord to — 

No. 

To make contact with them? 

No, but I am sure he knew what I was doing. 

Was it — did you ask him not to make contact with 

No. I told him what I was doing. 

What did you tell him, exactly what did you tell 



1 Secord? 

2 A 

3 I can't. 

4 Q 

5 A 

6 Q 

7 A 

8 Q 

9 them? 

10 A 

11 Q 

12 him? 

13 A I told hira that I am going to investigate to 

14 see if there is something we can do about this and I am 

15 going to ask Zucker to contact Mrs. North and find out what 

a. 

16 is what, whose who and if it can be done, if it is viMble. 

17 Q I thought that you said earlier that Mr. Secord 

18 told you it was — that he didn't want to get involved in it 

19 A Yes, he — 

20 Q Is that right? 

21 A Yes, he said he thought I was crazy. 

22 Q Did he ever tell you whether he spoke to North 

23 or Mrs . North about your proposal? 

24 A I don't recall that. 

25 Q What is the best of your — what is the best of 



ax ; 

UNCLASSIFIED 



533 



UNCUSSIflED 



188 



1 your recollection on that? 

2 A I don't reneinber. I really don't remember. 

3 MR. VAN CLEVE: If I understood your testimony 

4 correctly, you told Mr. Zucker that you didn't want him 

5 to identify who his client was; is that correct? 

6 THE WITNESS: Yes. 

7 MR. VAN CLEVE: So it is entirely possible to 

8 this day that Mrs. North would not know that you were 

9 responsible for having directed Zucker to meet with her. 

10 THE WITNESS: If my instructions were carried out 

11 that should be the case. 

12 MR. JANIS : Just a moment. 

13 (The witness confers with his attorney.) 

14 BY MR. NIELDS: 

15 Q Does Mrs. NOrth have a profession? 

16 A I don't know. 

17 Q Did you ever ask? 

18 A Ask her? 

19 Q Or anyone? 

20 A Well ~ 

21 Q Did you ever ask Zucker or Secord or anyone else 

22 whether Mrs. North had a profession? 

23 A I believe one of the possibilities that~wV were' 

24 reviewing — it was not whether she had a profession. We 
were looking for a way to see if we could get her, and when 



1, JV^^J*-*^ \Ji. aiijrvyiic: cj..9c 

UNCLASSIHED 



25 



534 



UNCLASSIFIED 



189 



1 he came to a dead end, that he -- I am talking about 

2 "He" being Zucker — we talked about the possibility of 

3 maybe getting her to work somewhere. 

4 Q For a real estate company? 

5 A That was the -- that is not the way it went. 

6 It ended up there. I was checking with Bill if he had any 

7 possibility in Washington that we could get Mrs. North 

8 to earn some money, and he said the only person that he knew 

9 was a developer. 

10 Q Real estate? 

11 A Real estate developer, yes. That is how it came 

12 about. The last time that I talked about this Bill was 

13 supposed to come to the States and see if this man, talk to 

14 him and see if he could arrange for that and to the best of 

15 my knowledge that never took palce. 

16 I believe that Zucker never got a chance to talk 

17 to this man to the best of my knowledge. 

18 Q When you say never got a chance, I guess I should 

19 have asked when these conversations took place. Do you know? 

20 A This is — I would say this is sometime between 

21 August and October, August-September. 

22 Q Is it your recollection that you first began 

23 discussing this with Zucker in August? 

24 A No, no, no. I thought your_ question _was_ in 
connection with the developer. 



25 



ght your question was \n 

UNCLASSIHED 



535 



uNcussra 



190 



1 Q When did you first start discussing with 

2 Zucker the possibility of paying for North's sons' tuition 

3 or daughters' tuition? 

4 A That should have been late 1985 or early 1986. 

5 Q When was the meeting between Zucker and Mrs. 

6 North in Philadelphia? 

7 MR. JANIS: Can I — 

8 THE WITNESS: I don't remember that. I think 

9 it was in 1986. 

10 MR. JANIS: Hold on a second. 

11 (The witness confers with his attorney.) 

12 THE WITNESS: Yes, I did not get to meet North 

13 until the Frankfurt meeting. 

14 MR. NIELDS: February of 1986. 

15 THE WITNESS: Yes. 

16 MR. JANIS : Do you want to correct your answer? 

17 MR. NIELDS: I am going to get to that. Using 

18 that date as a guide post, when is your best recollection 

19 now that you first began discussing with Zucker a method of 

20 providing tuition for North's child? 

21 THE WITNESS: I remember, Mr. Nields, when I 

22 seriously focused on this thing, and that that was like I 

23 said when we started to become active about the second 

24 channel when I had gotten to know North. So the time 

25 span that I gave you this is pretty accurate, August, 



UNCLASSIFIED 



536 



UNCLASSIRED 



191 



September, October, November. 

2 MR. JAIJIS: For the record you had said 1985 or 

3 1986. 

4 THE WITNESS: We corrected that. 

5 MR. JANIS: Now you are talking about it was late 

6 or mid to late — 

7 THE WITNESS: I don't know when I started with 

8 the concept, but I am talking about when I really started 

9 to focus in on this and really push Bill to go after it. 
I cannot even remember when Bill met with Mrs. North. 

MR. SABA: Mr. Hakim, could that have been in 

12 July 1986 when he went with you to Seattle? 

13 THE WITNESS: I don't think so. No, it could not 

14 have been. 
.|5 MR. NIELDS: You mean it must have been after 

16 that? 

17 THE WITNESS: I 



MR. NIELDS: Or it must have been before that? 
MR. JANIS: Can we go off the record for a 



18 

19 

20 second; 

21 MR. NIELDS. Yes. 

22 (Discussion held off the record.) 

23 THE WITNESS: I don't remember that. 

24 MR. WECHSLg^:. .9gC>^ J^^^ JflfiflTA "® doesn't 

25 remember that. 





537 



UNClASSinED 



192 



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 WITNESS: First of all, I cannot remember the 
dates, okay, precisely. I understand that there may be 
some confusion that I have excluded the -- when I said 
I don't remember that I have spoken to North. I don't 
want that to constitute that I exclude the possibility that 
I did not mention it. I definitely did not discuss it. That 
doesn't mean that I did not mention it. The possibility 
exists, but I don't recall. 



UNClASSm 



538 



JM FLS BP 



2 
3 
4 
5 
6 
7 
8 
9 

10 
11 
12 
13 
14 
16 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



UNCLASSIFIED 



193 



Q When you say "mention it," you say you may have 
told him that you want to help him with his child's education? 

A It is possible. 

Q What is your best recollection? 

A I can't remember, really. If I have told him, 
it must have been in a very indirect way. I don't remember 
that, honestly. ' 

Q I take it you have no recollection of his refusing 
it, assuming that he took it as an offer, or discouraging you 
from pursuing it? | 

A No, I don't recall such a thing. 

Q Now, I know that you can't be certain of the date 
when you first discussed this with Zucker and I think you 
have said that your best recollection is that it would have 
been August-September or 

A When I focused in on this. 

Q Is that correct? 

A Yes. That is when I think I started to really 
focus on this. I 

Q Here is what I would like you to do for us, regard- 
less of when the exact date was that you first discussed 
it with Zucker, approximately how long was it from the 
time you discussed it with Zucker until his trip to Philadelphia 
in which he met with Mrs. North? 



UNMSSIFIED 



539 



UNCUSSIHEB 



194 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

16 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



A He did not take a special trip for this purpose, 
Mr. Nields. 

Q But she did. 

A No, no, I am talking about Zucker coming from 

Geneva 

MR. JANIS: He is questioning, did she take a 
special trip? 

THE WITNESS: She went from Washington to Phildelphia 
yes, I don't know when she left. 
BY MR. NIELDS: 

Q But she made a special trip to see Zucker? 

A Yes. Yes. 

Q I am asking when did that occur in relation to 
the time when you first raised the subject with Zucker? 

A What I am trying to say is my point of reference 
canibe Zucker 's moves. I don't recall when Zucker went to 
Phildelphia so I can establish when Mrs. North went there. 

Q But you know that Mrs. North went there because 
Zucker told you that, isn't that true? 

A Yes. 

Q All right. Now, there must have been a time when 
he told you that he had just met with Mrs. North? 



That is correct. 



In Phildelphia? 



That is correct. 



UWSSW 



540 



UNcmssro 



195 



Q About how long after this time that you first 
raised the subject with him was that? 

A I don't remember, Mr. Nields. 

Q Was it more like a week, more like a month, or 
like six months? 

A Well, it is several weeks, I would say. 

Q What did he tell you about his conversation with 
Mrs. North? 

A That he collected all the information that he 
needed. Some of the information she did not have, and she 
was supposed to obtain additional information and that he 
would be talking to her again on the information when he 
was back in the states. That is the way I remember. 

Q What type of information was he asking her for? 

A I think he needed more information about the 
relatives, the family. 

Q What type of information about relatives and familyl 

A I don't remember. He said he wanted to know more 
about who was who in the family and so on. 

Q What was the purpose for his finding out more 
information about the relatives and family? 

A To find a way to assist with the plan. 

Q Was this, for example, finding out if there were 
other relatives who had jobs in which it would be easy to 
convey money to them? 



UNCUSSIREIl 



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A The general attitude is correct, but I cannot 
be that specific. You are setting the right direction, but 
I really 

Q In other words, more information about other family 
members to see if there was an easier way to route the 
money to the benefit of North's cnild? 

A Without tainting North. 

Q Without it becoming obvious that it had happened? 
MR. JANIS: That is not what he said. He said 

without tainting. 

-t 
THE WITNESS: Without tairu.ng North. I didn t want 

to damage him. I wanted to help him. I didn't want to damage 

him. That is what I am trying to say. 

BY MR. NIELDS: 

Q When you say you didn't want to damage him, was 

it you didn't want it to be apparent where the money was 

coming from that went to the benefit of his child? 

A Not — that was not the spirit. That is not the 
spirit. 

Q Okay, well just tell me then. 

A The spirit is the man's family was going to 
pieces and I wanted to see if I could do anything to help 
out, not to add to it, the problem. 

Q What was the risk of adding to his problems? 

A If he was goin|,'^c^ ^ a|cu|||.cit.96Wng involved 





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with some private enterprise for personal benefit that would 
very definitely have damaged him. And I didn't want that 
to happen. 

I was not prepared to increase the already 
existing burden that he had. 

Q Then I misunderstood something because it sounds 
to me from what you are saying, that you were looking for a 
discrete way to do it so that you would not injure him by 
establishing a connection between the private enterprise 
that you were involved in and the payment for the child's 
education. 

MR. JANIS: Excuse me, I think what he said in 
essence was that he was looking for an appropriate way to 
do it, not a way to do it so he wouldn't get caught, but a 
way to do it so that it would be appropriate. 

THE WITNESS: Exactly. Thatis'what I am trying to sa 
BY MR. NIELDS: 

Q Then can you expand on your answer 
about the family members that you were, and information VHfc 
about family members that you were looking for? 

A We, I gave you an example already about the land 
developer, we first searched to see if it was possible to 
be done within the family, a similar approach. I don't know 
exactly what Zucker was contemplating, but it was — I 



UNCIASSIHED 



543 



UNClASSinED 



198 



testified that the direction you set was correct. We were 
trying to see if we could find an appropriate way of helping 
out so you search within the family, the structure of the 
relatives and so forth, to see if you can find a way. 

If you can't find a way there, then you go to the 
outside sources, such as the land developer. So the last 
time we talked about this thing was that there is nothing 
that we could do through, the family and -- I even asked 
Zucker to make a phone call, I think. He said he was not — 
I remember now — said he was not planning to go to Washington 
but he promised me to call this man. I don't remember whether 
he ever made that call. 

Q To a man in Washington? 
A Yes. 

Q Did he identify him? 
A No, not to me. 

MR. VAN CLEVE: Do you know whether Mr, Zucker 
might have asked Mrs. North not to say anything to Colonel 
North about the meeting? 

THE WITNESS: I have no idea. 
MR. VAN CLEVE; You don't know? 
THE WITNESS: No. 
BY MR. NIELDS: 
Q What — there is still something I am not under- 
standing — what would be an appropriate method for 



iii^ni hmm 



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A If we knew we would have done it. 

MR. VAN CLEVE: I think what he said is — that 
was the point, to see if there was an appropriate method. 
The net result was that Zucker said there was not an 
appropriate way to do it. 

THE WITNESS: Not that he could think of. 

BY MR. NIELDS: 
Q But it was contemplated that he would pursue it 

at least with the 

A land developer? 

Q With the land developer. 

MR. VAN CLEVE: I am uncomfortable with the use 
of the word "an appropriate" here. I would like to know 
whether you instructed Mr. Zucker to find a way to do this 
that was legal or not. 

THE WITNESS: Legal, would not taint, would not 
damage him. 

MR. VAN CLEVE: But not simply to find a way to 
do it without getting caught? 

THE WITNESS: That was not the intention. For 
instance, if there were provisions in the law that I could 
come up and say that here I am donating this without getting 
the guy into trouble, I would have done it. 

MR. VAN CLEVE: I understand. 

THE WITNESS: Okay. The idea was not — we were 




Ui^l 



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llASSIFIED 



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not talking about such huge sums of money and I understood 

that 

BY MR. NIELDS: 
Q How much money were you talking about? 
A I don't remember what would have been the interest 
on $200,000, probably $14 or $15,000 a year. 

Q Does the number $75,000 ring a bell? 
A $75,000 a year? 

MR. VAN CLEVE: A year? 
MR. WECHSLER: A year? 

MR. NIELDS: I didn't say a year, I said $75,000. 
THE WITNESS: No. 
BY MR. NIELDS: 
Q That does not ring a bell? 
A No. 

Q That is not an amount of money you discussed 
with Mr. Zucker? 

A Amount of money to be given for the school? 
Q To Mrs. North? 

A No. I did not talk about suras. We talked about 
taking care of the schools, the cost of the school. 

Q Th^l^cost of the school for the four-year period? 
A Maybe $75,000 would have come out for the duration. 
If you take five years at 15 that comes out to $75,000. But 
that is not my calculations. .J^ g^g i^p^tjje^ ^^^^ pe r jnnum. 



""■"*••• iMiram' 



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UNCLASSIFIED 



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1 Can you explain to me what was contemplated in 

2 connection with this land developer, exactly what role 

3 the land developer was to play? 

^ A To see if, for instance, if she could have a part- 
S time job working so she would add to the income so they could 
^ take care of it. That was the direction. And work there. 
^ Q Was it ever discussed with Mr. Zucker that there 
® would be a transfer of money from an account in Switzerland 
^ to an account of the land developer in Switzerland, in other 
words, an account of yours in Switzerland to an account of the 
land developer in Switzeralnd and a simultaneous transfer 
in the United States from the land development company to 
Mrs. North? 

A No, no, that — no, that is not the way. 

MR. JANIS: Not that you know. Not that you 
are aware of. 

THE WITNESS: These were not the things that I am 
aware of, but the thought was, I said, Bill, even if she 
cannot do it, do a darn thing, I don't know the woman, 
I don't know if she has any capabilities, but a lot of work 
is being done there. If the guy doesn't have an opening, 
cannot pay for it, we will pay for it. In other words, 
we paid the guy to pay her so she would work. I did not 
know the capability of the lady. I don't know the capability 
of the lady. It was 



DNOLASSIFIED 



547 



UNCUSSIFIED "' 

1 - BY MR. NIELDS: 

2 Q But understand the plan in which if the development 

3 company did not want to (afiy her, in which case, you would pay 

4 her, how was that to be done? 

5 A To pay the developer and he would hire her and 

6 pay her . 

7 Q And how were you going to pay the developer? 
A From -- just like I told you, from the interest. 
Q But I mean how would the money be put into the 

custody of the developer? 

A Mr. Zucker had to pay him. 
Q Write him a check and send it to his 
bank in the United States? 

A We didn't go that far into this. We were 
discussing the concept, Mr. Nields. 

Q You never talked to Zucker about the manner in 
which the money would be gotten into the possession of 
the developer? 

A That is his expertise, he knows the man, he did 
not even want to disclose the name of the man to me. 

Q Did you discuss at least the fact that you 
wanted to do it in a way that would not taint North and his 

family? 

A D^jfinitely. 

Q And by thatk^ou mean it would be done in such a 



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UNCLASSIFIED 



203 



way that it would not be obvious and apparent that the 
developer was being paid by you? 

A You can reach to that conclusion, yes. But deep 
inside I was hopeful that Mrs. North had enough capability 
and I did bring this up, I said I hope to God that she can 
even bring in clients and collect the commission and really 
deserve — I mean earn what she is doing. I don't know what 
her expertise might be, but we wanted to get her started, 
have a job so she would not be sitting home waiting for her 
husband to come home. 

It was a plan that tried to save their marriage 
and get the kid to go to school, prime the pipe, if you will, 
to get it going. It was not something intended to do 
something dirty. That was the — that was not the concept. 
That was not the idea. 

Q I understand it was — do something to the benefit 
of North's marriage and feunily, but I-^ke it it was part of 
the concept to do something secret? 

A Yes, that has — that has been obvious from the 



MR. VAN CLEVE: Understand the arrangement with the 



ONCLASSIHED 



549 



wussm 



204 



1 " MR. VAN CLEVE: She would never have known? 

2 THE WITNESS: We even talked about putting an add 

3 in the newspaper and getting her to work. She would not have 

4 known. 

5 MR. NIELDS: Let's mark this document as Exhibit 

6 NO . 5 . 

^ (The following document was marked as Exhibit AH-5 
® for identification:) 

9 COMMITTEE INSERT 

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UNCLASSIFIED 



550 



end jm 13 



ONCUSSIFiED 



205-210 



BY MR. NIELDS: 
Q I am putting in front of you, Mr. Hakim, a document 
that has been marked deposition Exhibit AH-5. I will 
ask you to take a few minutes and read it. After that, I 
will ask whether it has anything to do with the transaction 
you have just been testifying about. 

MR. VAN CLEVE: I take it the pencil marks are 
yours? 

MR. NIELDS: Those are not original. No. 

MR. SABA: What is the "H" number? 

MR. VAN CLEVE: H-1646. 

MR. SABA: I will get a clean one. 

MR. VAN CLEVE: That doesn't concern us, but if 
you have an extra copy that would be great. H-1646. 

MR. SABA; Yes. 

MR. VAN CLEVE: Can we take about a five minute 
recess. 

MR. NIELDS: Sure. 
(Brief recess.) 




'.^ 4 ■'i '^ 



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MR. NIELDS: Back on the record. 
BY MR. NIELDS: 
Q Mr. Hakim, you have in front of you a document which 
has been marked Deposition Exhibit No. 5. 
A Yes, sir. 

Q It has the words -- first of all, I take it you have 
had a chance to look at this document? 
A Yes, I have. 

Q And do you know what transaction it relates to? 
MR. JANIS: First of all, do you know whose 
handwriting it is? 

THE WITNESS: This — I am pointing to the right 
part of this — appears to be Bill Zucker's handwriting. 
MR. JANIS: In the box? 
THE WITNESS: In the box. 
BY MR. NIELDS: 
Q Initialled by Zucker? 

A Yes. But this part, I have a little bit — I don't 
find — for instance, this is written — what could be Bill's. 
Q You are referring to Mrs. Belly Button. 

Did you answer my question, whether you know what 
this transaction is? 

A No. I don't even know if it is a transaction. 
Q You don't know what it relates to? 



No, I really don't. 



UNCUSSinED 



552 



ONCUSSIFIED 



212 



^ Q Do you know who Mrs. Belly Button is? 

2 A I believe this is the code name that Mr. Zucker came 

3 up for Mrs. North. 

4 By the way, here it says Richard V. Secord, small 

5 fee. I don't know what this is. 

e Q But do I take it you have an actual recollection 

7 that Mrs. Belly Button refers to Mrs. North? 

8 A Yes. 

9 I refer to this neirae when we are talking about the 

10 interests of the $200,000 that General Secord asked me to set 

11 aside for death benefit, I think we talked about that at that 

12 time. 

13 Q And does that mean that it was at that time that you 

14 or Mr. Zucker came up with the name Mrs. Belly Button for Mrs. 
16 North? 

16 A Yes. I testified that we were joking eUsout this 

17 thing, and caressing some. He came up in a joking manner with 

18 this nsune. I really don't remember the circumstances, how he 

19 came aibout — sometimes he has a strange sense of humor. 

20 Q But in any event, when he came up with this name of 

21 Mrs. Belly Button, and at the time he came up with it, I take 

22 it it referred to Mrs. North? - 

23 A Yes. 

24 Q Is it your recollection that the name Mrs. Belly 
26 Button was invented by Mr. Zucker at about the time that you 



fNClASSIRED 



553 



iMsra 



213 



1 set the $200,000 aside for death benefits? 

2 A I really don't remember how this whole thing, the 

3 name, developed. I think it started out buttoning up with the 

4 people when they die, and then we talked about the interest -- 

5 they came up with the belly button. I can't recall when all 

6 this happened. 

7 Q It may be that the subject of the interest -- 

8 A Came at a later date. 

9 Q And the name Mrs. Belly Button came up a little bit 

10 later? 

11 A It is possible, yes. 

12 MR. JANIS: Again, if I understand the spirit of 

13 this deposition, which is to try to get to the bottom of 

14 things, my recollection was that the button account was set up 

15 with $200,000 around May 20th of '86. 

16 MR. NIELDS: Right on the nose, right on the button. 

17 MR. JANIS: Was it May 20th of '86? 

18 MR. NIELDS: The 20th. 

1® THE WITNESS: It should have happened before. When 

20 it carried the name Button, I don't remember. But there was 

21 the set-aside — Zucker should have set that aside when Secord 

22 asked me to set aside the death benefit monies. When the name 

23 was allocated to that could have been at a later date. 

2* MR. JANIS: This document, H-1647, was included in 

25 the documents provided by Mr. HeOcim, correct? 



S^IIASSIFIED 



554 



11 



UNCLASSIflEO 



214 



MR. NIELDS: Yes. 

MR. JANIS: And that indicates that a transfer was 



is that correct? 

So that was three weeks or almost three weeks before 



1 

2 

2 made on May 2nd, 1986, from Republic National Bank to STTGI; 

4 

5 

g tne money was put in the button account 

. MR. NIELDS: Before it was put in a capital account, 

a (Discussion off the record.) 

MR. NIELDS: Let's go back on the record 
yQ I just have a few more questions on this 

BY MR. NIELDS 
^2 Q Did Secord ever indicate to you that the $200,000 

13 transfer into the button capital account was money set aside 

t4 for North? 
IB A He didn't come up with the name of button capital 

16 accoiint. To the best of my recollection, that money was set 

17 aside for death benefit 

18 Lou has raised some other issues now. I am 

19 completely confused adsout the other figures that he talked 

20 about 

21 If you recall, I earlier said that I thought that 

22 idea of assisting North's family with the educational plan 

23 was late '85, and then we went through analysis that I didn't 

24 get to know North until early '86. Do you recall that? 

25 All these are confusing me more, and they lead me to 



UNCLASSIFIED 



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UNCUSSIRED 



215 



"believe that it is very possible that Mr. Secord instigated the 
idea of coining up with the educational program, and that could 
indeed have happened in '85, as I originally thought the case 
would be. So I have a lot to think about now. 

You mentioned that there is another $250,000 that 
was set aside. Can we go back to that and see if that could 
help me to come back to see what this button thing is? Can 
we look at that number and the date? 

Q I show you the various numbers that we have and the 
various dates. There is $250,000 that went into your capital 
account in May of 1985. I take it that, to the best of your 
knowledge, that doesn't have anything to do with either death 
benefits or North, either one or the other. 
It is May of '85. 

A And this, the button account, was what date? 

Q May of '86. 

A I see, a year later. 

Q Who were the death benefits supposed to be for? 

Who might die? 

MR. WECHSLER: You are asking for what he was told? 

THE WitNESS: It is a good question, Mr. Nields. 

(Whereupon, at 7:15 p.m. the deposition was 
adjourned, to reconvene at 10:00 a.m. on Monday, May 26, 



1987.) 



yNClASSIFIED 



556 



557 



16 



23 



ONCIASSIHED 




1 

2 OOFX TT ' tr ^ '^'^'' 

3 

"* DEPOSITION OF ALBERT HAKIM - Continued 



5 

6 Monday, May 25, 1987 

7 

® U.S. House of Representatives, 

^ Select Committee to Investigate Covert 

^° Arms Transactions with Iran, 

■•^ Washington, D.C. 
12 

^3 The Committee met, pursuant to adjournment, at 10:15 a.P^, 
^* in Room H-139, the Capitol, Mr. John Nields presiding, 
^5 On behalf of the House -Select \;ommittee: John 

Nields, George Van Cleve, John Fletcher, Joseph Saba, 
^"^ Robert Brink, Ronald Points^ (M i i^t ( (^0 t'J'.'^-^-^, 

On behalf of the Senate Select Committee: Arthur Liman, 

Cameron H. Holmes, Timothy Woodcock, Louis Zanardi, David 



^ Faulkner, Mt^SSBBOi^Vr Paul Barbadoro, John Monsky. 

2'' On behalf of the witness: N. Richard Janis, Lawrence l 

^ Wechsler, and Clement R. Gagne, III; Janis, Schuelke & 

Wechsler, 1728 Massachusetts Avenue, N.W., Washington, D.C. 



20036. Iliirti i rt A ar||*f\ Psf^allyOeclassitied/ReteaseaonlLiA^SS 

|||L|I"| AVxIrlrll under pcovisinns 01 E <2356 

25 lllMll ilalAlll ll^li 1^ '^ 'JO'X'!^''' '^^mal Security Ccunal 



558 



UNCLASSIFIED 



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Whereupon, 

ALBERT HAKIM 
having previously been sworn, testified further as follows: 

EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 
BY MR. NIELDS: 

Q Mr. Hakim, this is a continuation of your deposition 
which is, I guess, the beginning of the fourth day of it. 

A Is this the fourth or fifth? 

Q Fourth, I believe. Friday, Saturday, Sunday, and 
today is Monday. 

Overnight, have you had a chance to consult your 
memory and also a few documents to help refresh your memory 
in connection with the transaction in which you were proposing 
to see if you couldn't find a way of getting some money for the 
benefit of Mr. North's child's education? 

A I didn't have access to any documents, but starting 
4:30 this morning, it was very hard to do that last night, so 
this morning at 4:30, I tried to go over the events as closely 
as I could and still may have a little difficulty with some of 
the dates. I'm hoping to get some assistance here, too, to ■ 
get those dates straightened out; but I think I have ^ ^ * 
reasonably good recollection now how things might have happened 
in connection with the desire to assist Mr. North's child. 

If you would be a bit patient with me, I know you 
lawyers like to, go .tJjrough^3f:tS»g^<itly, but it is important 



JO through^fac 

INCUSS 




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559 




that I clarify a number of issues that were raised during the 
past three days' testimonies. I think I can sum all of those 

3 up today. 

4 , At one point, I talked and almost insisted that they 
should have been set aside for death benefits; and I believe 
I testified that that was in late '85. And then when we tried 
to relate that to the $200,000, the so-called Button set 
aside, and the dates didn't relate, you recall that, then 
this document that you have in front of me that has to the best 
of my ability, has Mr. Zucker's handwriting on it — 

Q That is Exhibit 5? 
A That is Exhibit 5. 

MR. JANIS: Did you make me a copy of that? 
MR. SABf: We'll get you a copy when we get into 
the office. 

BY MR. NIELDS: 
Q Go ahead, Mr. Hakim. 

A Okay. There were three statements also yesterday 
to — at about the same time, one made by yourself, the other 
one by Lou, and an earlier statement by yourself, Mr. Nields, 
that I made note of those in my mind and those statements 
were whose death benefit you asked. And Lou brought up the 
subject of is it possible that the $250,000, and he referred 
to a certain entry in the ledger, that would be the set aside 



for death benefit. «.-.,%; i ASii 



Ui^ULHO 




560 



10 



UNCLASSIFIED 



4 



1 " And earlier yesterday you had raised the -- in 

2 connection with the dates that the set aside had anything 

3 to do with Mr. McFarlane's trip to Tehran, and my understandinc 

4 of the question was that if the $200,000 was set aside for 

5 a group of six people, our delegation, I believe had that many 

6 people in it — went to Tehran — and my answer was well, for 

7 that, we were ready to attack Iran and our forces were sitting 

8 ready. 

9 Taking all these with me home and trying to recon- 
struct the events to the best of my capability, the following 

11 is my summation: 

12 That I believe I'm right in having received from 

13 General Secord sometimes in '85 to set aside a sum -- could 

14 have been $200,000 or $250,000 — I cannot be very precise 

15 about that — for the benefit of the people in the field in 

16 Nicaragua initiative. That was the reason for my saying there 

17 was such a set aside. And the records indicated that the 

18 Button account was established I believe sometime in May, 

19 Mr. Nields. Has that? 

20 Q There was a transfer to the capital account in the 

21 name of Button on May 20 of 1986. 

22 A Okay. So that in short is the following, that there 

23 should be from one of those entries that we have, should 

24 represent the first set aside for the death benefit of the 

25 contras. The ButtorL account, was ^nafelkar set aside for death 




m°m 



561 



":i'Hii!?SIF!E!l 



1 ■ benefit, and this is where you helped me to remember and 

2 asked who was going to be the beneficiary; and that was 

3 North's family. And the way this thing evolved, and I'd like 

4 to emphasize it was an evolution, and it was not a meeting or 

5 j a discussion. That I believe it was during -- I have been 

6 hearing indirectly about Oliver North from the very beginning 

7 of my association with these two projects; and I didn't meet 

8 him until February of '86. And I learned about the gentleman 

9 more, and I became more and more fond of him, and I got 

10 emotionally attached to him, still am. 

11 He never at any time had any meeting with me or I 

12 a meeting with him with the presence of anyone else, including 

13 General Secord, to set aside any money for his benefit. There 

14 was never such a meeting. 

15 However, during the very sensitive and I would say 

16 also emotionally sensitive period of planning the trip to 

17 Tehran, and I believe also at the same time the] 

18 ^^^^^^^projects were brewing. Those -- that period of time 

19 was very, very touching, sensitive for us because we were 

20 all in such a frame of mind that we may lose our boys 

21 in one of these events. It was really sort of one -- they 

22 were getting ready to leave, it was sort of a farewell, and 

23 we were not sure what's going to happen to them. 

24 There were remarks, statements and in different 
25 1 periods of time that Ollie made using the four-letter word 



IKWSSIFIFn 



562 



yjiSLASiilflEB 



that he didn't care abbut his life, he's a soldier, he's ready 

2 to die for his country; and he maintained that position 

3 throughout. But he had a lot of concern about his family, 
concern about what's going to happen to them if he dies, gets 

5 killed, gets kidnapped. There was concern about what would 

6 happen if they get a divorce and the family would break up. 

7 All these things were happening during that time. 

8 Q And these were discussed with you, 1 take it? 

9 A I was present. 
Q This was in Virginia or at the White House, the Old 

Executive Office Building? Overseas? 

A Could have been — I think mostly overseas. It 
could have been some in the states. That's why I chose the 
terminology, "evolution." It was not one meeting that we 
sat down and discussed marital and family problems of Oliver 
North. There was no such a meeting. It was just various 
^^ events during various meetings. 

^® During this tense period of, I believe we have 

^9 Identified to be May came about, and I had earlier discussed 
20 sometimes in the spring of '86, I can't remember when, with 
2'' Richard Secord. I initiated the discussions, to the best of 
my recollection. I did. I had concern about Ollie, I said. 
I think we should do something about it. 

He said what do you mean. I said well, I think we 
should have — we , shquld take caxe -OL his kids, and we should 






563 



OHCIASSIHED 



' take care of — in case he gets killed, we have done this for 

2 the contras, why can't we do it for him? He said what do you 

3 have in mind? I said I'd like to set aside $500,000 to use for 
^ this initiative. He said you are out of your mind. You 

5 don't understand a soldier's life. These kinds of money 
^ absolutely are not acceptable to me; there are benefits 
^ from the government and so on. What about the income from 
® the $200,000 set aside? 
' He accepted that, but again when I started to 

tell him what my pl2m was to put this money to use, that was 
when he divorced himself from further discussion and said that 
he didn't want to hear anything about it. He said the bottom 
line is — so the bottom line is he became aware that I was 
setting aside the $200,000 — 

MR. VAN CLEVE: This is Secord? 
THE WITNESS: That's Secord. Oliver — 
MR. JANIS: Just keep on. You became aware you 
were setting — he became aware you were setting aside 
$200,000. Finish that. 

THE WITNESS: And he was — he didn't want to 
have anything to do about knowing how I was going to 
operate that set aside. That was when I sat down with Mr. 
Zucker to put this package together. 

If I may divert a second from this discussion and 
also interject that I^belj.ejje^h^_acaurred during the time 



MMiriFn^ 



564 



UNClASSm 



\ that I had involvement in connection with the May events in a 

2 logistical manner. In other words, I was stationed, if you 

3 will, in Geneva for approximately two weeks; and this was more 

4 than any any other time that I could spend in one place at a 

5 time, because I knew I was going to be spending that much 

6 time there; and like most of the time that I would stay Jn a 

7 hotel, I had rented a furnished apartment in Geneva. 

8 I was also equipped with a KL-4 3 during that time, 

9 which I had not, by the way, learned to use. As they put it, 

10 they walked me through it as it became necessary to use. 

11 And this was also the period to the best of my 

12 recollection that the DEA gentleman came to visit me in 

13 my apartment and pick up the $30,000. This was also the 

14 period that Tom Clines came to that apartment and got his 

15 instructions from me that was passed on from, I believe, 

16 Tel Aviv from Richard to me and then he took a shower and 

17 I believe I had arranged for transportation for him, private 

18 transportation. 

19 I can't rem ember the details of that at this time. 

^^^^^^^^^^^^^^^^^^^1 The DEA people were 

21 was coordinating the events^^^^^^^^Hwhich Tom Clines was 

22 effectively managing. ^^^ 

23 MR. JANIS: Excuse me for a second. 

24 Can we go off the record? 
28 (Discussion off the record. 



UNClASSiHED 



565 



10 



19 
20 
21 
22 
23 
24 
26 



UNCLASSinED 



1 BY MR. NIELDS: 

2 Q This is all part of a piece. I would like to hear 

3 the whole thing. 

4 MR. JANIS: Okay. 

5 MR. NIELDS: Thanks. I understand what you are 

6 doing, but I think I want him — want to hear him tell the 

7 whole story. 

8 MR. JANIS: Okay. 

9 THE WITNESS: So I was coordinating from Geneva with 
Secord, with Tom Clines, and also with the boat, our fsunous 

^' ship, spending day and night up doing this, using the KL-43. 
^2 I It was during this period that I believe I held 

^^ serious discussions with Mr. Zucker to put some life into this 
^* Button account. And this was, I believe, the period that he 
talked about the land developer, and I made it very clear 
that — to Mr. Zucker that this was intended for helping with 

I the education and hit two birds with one stone, also to be 

18 

a set aside in case of Ollie's death. 

This document that you have put in front of me. 
Exhibit 5, it really in no way helps me to be precise 
whether there has anything to do or not to do with the events. 
I see on this thing boxed sepeurately this — the telephone 
number with the name of this gentleman or whoever, Ogden; 
telephone number; $15,000; smd then I see separately a note, 
'"RVS" — "R. V. Secord, small fee." Then in a separate 



m afs^iFiFR 



566 



UNCLASSra 



10 



' circle, I see $15,000 wired to STTGI . I cannot really in 
^ my mind say if this exhibit relates or doesn't relate to what 
^ 1 have explained. It may, it may not. 
BY MR. NIELDS: 
Q I take it t^e thing that would point you in the 
direction that it soinehow would relate is the use of the 
phrase "Mrs. Bellybutton. " 

A The phrase "Bellybutton." The only significance 
this document has for me is that I discussed with Mr. 
Zucker the developer method that I explained yesterday. 

Q I am sorry. I want you to be able to tell your 
story uninterrupted in the main, but how does this document 
help you fix the time when you talked about the developer? 

A Because in this box with the arrow saying Mrs. 
Bellybutton, the arrow pointing to this, and the 15,000, and 
I — even without having had the chance of looking at the 
figures, I told you that roughly I thought the interest 
on $200,000 would be something between $13- to $15,000. And 
that's what I remembered. That's why in my mind I relate 
them. 

I must also add at this time that when Oliver 
North was meeting the kind of remarks that I heard he 
testified, I did not tell him that I had established an 



account or intended to establish an account; however, I did 
tell him that Ollie. \^»r one family, any of us who would stay 



iWi^fflrn^ 



567 



UNCMSSIFIED 



11 



' alive would look after your family. I don't want you to worry 
2 about that. And tears came to his eyes. So to mine. And 
^ living that, tears come to my eyes again. It was a very 

* tense period; a very, very tense period. 

5 We had our boys spread out all over the world 

* amongst maniacs, crazy people, the boat. It was really 
terrible. 

® Anyway, coming back to the type of information 

® that you need for your deposition here, I did not tell or share 
with North that I was planning to set aside a $200,000 death 



benefit for the — under the account named Button. This was 
created between Zucker and I, but I did tell him that ye^ 
are one family, and he needs not to worry. I hope I answered 
your question. 

Q Good. I'm going to — I have a few more questions 
I want to ask you about. The word, "Button," I think on the 
first day of your deposition, you gave two or three different 
2mswers about what it meant. Now the record, the transcript 
will reflect what you said emd I may be mis+recalling it, but 
my memory is that the first thing you said was button, button 
up. Then you made a reference to bellybutton, something 
about pushing a bellybutton. 

A I said you had — it had to do with the wives, 
if you recall. At that time you were not getting into the -- 

Q Which e§9% iJjFSt ^ your recollection, button or 



ifflMfJInrn 



568 



UNCUSSIflEO 



12 



' bellybutton? 

2 A I cannot be sure, Mr. Nields. I really cannot be 
sure. 

* Q What was the derivation of the word, "Button," 

® to the best of your recollection? 

® A It could have started bellybutton, and then we 

^ shortened it to button, and then maybe B. Button. It all 

could have happened at the S2une time. I really don't know the 
exact sequence of events, but I also testified that Bill 
Zucker sometimes has a funny sense of humor. 

The idea that he was putting across is if something 
happens to Ollie, somebody has to go and caress and comfort 
Mrs. North. That was what he was trying to put across. 
That was his choice of word type. There was no pre-- you know, 
scheme to come up like, for instance, C. Tea. That was a 
design. This has absolutely no architectural thought behind 
it. It was something that came out in our discussions, and 
we used it. 

Q When do you — again with your refreshed recollection 
when to the best of your recollection did the meeting in 
Philadelphia between Mr. Zucker and Mrs. North occur? 

A I really cannot be sure. It could even have 
happened before then. Could have happened before we set up the 
account. Or after. I really have no recollection. 

Q Well, again, r^ don' t^ want tODUsh you into a 



l^^«li!;lM' 



569 



UNCLASSIHED 



13 



1 recollection you don't have, but I would like to make sure that I 

2 I've asked you all the questions that might help you refresh 
your memory. 

4 The way you've described it, it makes it sound 

5 as though this idea came about as a result of the intensity 

6 of the concern that you had for Mr. North during the 
' period leading up to the trip to Tehran. 

® A That's wrong. 

Q Well ~ 

A That's when I became operational about it. I test- 
ified that I have been hearing about these problems even 
prior to the time that I met Mr. North through Secord, who 
North was, what was happening, and so on. He was telling 
me quite a bit about him. That was the time that I really — 
you know, I said it cannot be an idea any more. It has 
to happen. Because we were becoming operational. 

Q So that you had the idea sometime earlier that you 
wanted to help out North's family? 

A With the kids, yes. 

Q And then you actually took steps to do something 
about it in the period in May when you were stationed 
in Geneva right before the trip to Tehran? 

A Right. And this is in line with my earlier 
testimony that I -- for the benefit of the kids, I wanted 
to use the interest from the set aside. That created the 



IINHi ARftlHFn 



570 



UNCUSsm 



14 



' confusion in my mind until Lou brought up about there being 

' two set asides 

^ That is also another possibility that was proposed 

this morning to me that I cannot — I don't remember. Whether 

® by the time that the -- we created the account "Bu^-ton," but 

" It was the very saune set aside for the contras thdt we just 
changed the beneficiary of it. This was a question — this 
question was raised by one of my lawyers. I said it's 
possible. I don't remember. 

Q But you are saying there that it might have been 
the very same $200,000 amount and that you changed the 
beneficiary from the contra, people working on the contra 
project to Mr. North? 

A Yes. Because by then we had enough mot(Sy% 
that we intended to use for the contras. That's — you know, 
that's a logical approach. I don't know whether I thought 
of it, whether I did it. I cannot be sure. The documents 
may help us to see if there are other set asides. 

Q My recollection again is that yesterday you said 
something to the effect that there was an idea of going to this 
contractor in the U.S., having Mr. Zucker go to him? 
A A developer. 

Q Developer. And that that never happened. That 
you never got around to doing it? Or something to that 
effect? Is that correct? 



UNCLASSinEO 



571 



12 
13 
14 
IB 
16 
17 
18 
19 
20 
21 
22 
23 
24 
26 



VNCUSSIFIEO 



15-16 



^ A I — that is my testimony. The answer is yes. 

2 Q And then my question is going to be to the best 

3 of your memory, why wasn't that -- no one ever got around to 

4 approaching the contractor? 

5 A I remember a definite discussion that I had with 

6 Zucker when I urged him to do that by phone. He said such 

^ things you don't do by phone. Whether the reason it did not 
take place is because he didn't go to the States, I really 



® don't know why he didn't. I never asked Mr. Zucker how 

^ he approached Mrs. North, what they discussed, the details. 
11 



I had a general understanding that he was searching to 
understand the structure. I tried — effectively, Mr. 
Nields, I was trying to create a situation that Mrs. North 
would become, if you will — I'm talking about a character 
that's not my expertise, to become a client of a lawyer, 
i.e. Mr. Zucker. 

I didn't want to know what went on between them. 
So I wanted to generate the idea, leave it up to them to 
deal with. So I didn't ask too many questions. 

Q Is it consistent with your recollection that the 
developer was never contacted because you ran out of time, 
so to speak? In other words, the publicity started and 
things started falling apart and that's the reason the 
developer was not contacted? 

A Well, if.tllis_i> the case, then I don't know how 



--tlli5 ii? the case, then 

iMnfAWIflFH 



572 



UNCLASSIFIED 



17 



1 -to cover between May and November 

2 Isn't it clear that I said I don't know if Mr. 

3 Zucker did contact or did not contact the developer? I think 

4 I testified to that, that I don't know 

5 Q My understanding of your testimony is that you 
8 don't know, but your general impression was that he never 
^ got around to it? 

8 A Yes 

9 Q Is that correct? 
A I don't know. Yes. Exactly. That's correct. 
Q What is your best recollection of the — I take it yo 

had a number of conversations with Mr. Zucker on this subject 
Both before and after the time when you actually set up the set 
^* aside? 

^* A That's correct 

'" Q What is your best recollection of the span of time 
covered by those conversations? 

A It could be months^ span. It could have — the 
best way that I can restructure events in my mind was 
that the issue of the school ccune about first and then came 
the issue of the — 
Q Set aside? 

A — death set aside — death benefits set aside. 
That's why I have been saying — talking about the interest 
of the death set aside. It's very possible a discussion 



UNCUSSinED 



573 



Idd 1/fls dennis 
1 
2 
3 



UNCIASSIRED 



18 



i had first related to the interest of the death benefits set 
aside of the contras to use for that purpose. That could be 
the confusion — the confusing issue. 

Q Am I understanding your testimony correctly that 
after the trip to Tehran, the set aside remained in place for 
the benefit of Mr. North? 

A For the same purpose. 

Q Do you have any recollection of a time when you 
discussed with Mr. Zucker the possibility of making a lump-sum 
transfer to Mrs. North in the approximate amount of $70,000, 
$75,000? 

A I cannot remember such a discussion. I do remember 
saying that that is how much it would have cost to put the kid 
through school, but to make a lump-sum transfer, I don't recall 
such a thing. 

Q What is your — I would like to just ask that in an 
open-ended way and have you tell us everything that comes to 
your mind on this subject. 

I take it that your recollection is you never 
specifically discussed with Mr. North precisely what you were 
doing? 

A That is correct. 

Q And I take it from your testimony yesterday that you 
have no reason to believe that Mr. Secord specifically dis- 
cussed what you wei 




I 





574 



UNCLASSinED 



19 



1 
2 
3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
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25 



A That is a logical conclusion, because he didn't 
want to know what I was doing. 

Q You never asked him to do it? 

A No. I definitely did not. 

Q And he never told you that he did it? 

A That is also correct. 

Q And he never told you that he was going to do it? 

A That is also correct. 

Q So if he did it, if he did it, it was totally 
without your knowledge? 

A And — the answer is yes, and if he did it, it 
would be very much unlike him. 

Q I take it then the most that you told Mr. North 
on this subject was what you testified to earlier, that you 
were all one family and that if anything happened to him, you 
would look after — 

A Anyone who would stay alive, look after — 

Q His family? 

A — his family, yes. 

Q Now, what — can you tell us everything that you 
know on the subject of what Mrs. North was told about this 
arrangement? 

Make sure that as you do — 

A You mean by Mr. Zucker, you mean? I haven't spoken 
with Mrs. — 



UHClASSra 



575 



1 



20 



Q I understand. 

2 You had no conversations with Mrs. North about this? 

3 A No. 

^ MR. JANIS: Do you know anything, do you know any- 

5 thing Mrs. North was told? 

e THE WITNESS: No. No. 

7 BY MR. NIELDS: 

e Q Did Mr. Zucker — I guess I want to ask this in an 

9 open-ended way. What did Mr. Zucker tell you that would bear 

10 on the question of what he told Mrs. North? 

11 A Not more than what I have already told you. He 

12 tried to examine the feimily structure of Mr. and Mrs. North, 

13 the relatives to see if he could use someone within the family 

14 for that purpose. 

15 He either did not get the information from Mrs. 

16 North or there was no such a candidate. That is how he started 

17 to look outside of the family. That is the only thing that I 

18 recall that Mr. Zucker told me in connection with this. 

19 Q And what, if anything, did Mr. Zucker tell you on the 

20 subject of what he told Mrs. North about the source of the 

21 money ? 

22 A Well, I asked him not to identify me. I cannot 

23 testify if he followed those instructions or not. I really 

24 don't know. 

25 Q Did Mr. North 



iWHED 



576 



UNCIASSIHED 



21 



1 ' A I cannot recall — when you say ^, you mean meeting 

2 hiro? 

3 Q That is my first question, yes. 

4 A I cannot recall that they have ever met. I am 

5 searching through my mind, seeing if they met in the States. 

6 I cannot recall the case as such. I cannot recall Mr. North — 

7 we had one or two meetings with the Iranians , the second 

8 channel, in Geneva. 

9 I cannot recall if there was a need or an occasion 

10 for him to meet Mr. Zucker then. I can't remember that. 

11 Definitely, there was no meeting in Frankfurt. We had a few 

12 meetings in Frankfurt with the Iranians. 

13 I cannot recall Mr. Zucker meeting Mr. North there. 

14 I just — I find it very out of regular. 

15 Q Did Mr. North know who Mr. Zucker was? 

16 A Definitely. 

17 Q Now, again I don't want your — I am going to say 

18 something to you, and I only — my only question is going to 

19 be whether this refreshes your memory in any way. Okay? 

20 A Yes . 

21 Q But your lawyer asked us yesterday if we knew when 

22 Mr. Zucker was in Philadelphia. 

23 A Yes. 

24 Q We have information — again, I don't want this to 

25 put something in your mind; -I^i^^ Jlj^l^ AP confront you with it 




577 



UNCLASSIFIED 



22 



1 

2 

3 

4 

5 

6 

7 

8 

9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
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24 

25 



to see if it refreshes your memory, that he was in Philadelphic 
in August and September of 1986 in connection with "Forway." 

A Yes. 

Q Does that ring a bell as the time when you learned 
that he had met with Mrs. North? 

A I still cannot be specific, but the dates — but the 
issue of "Forway," that is important for me, because I know he 
was in Philadelphia, and I so testified. 

Q Yes. 

A That he was there to take — he was seeing his 
lawyer in connection with "Fcjpway." 

Q With "Fcirway" at the time he met with Mrs. North? 

A Right. He did not make a special trip. He was there 
and that was convenient, that is how they organized it. If 
that is the date, then it is consistent that I was concentratin< 
on the issue of the education prior to concentrating on the 
death benefit. 

Q This would be September, August-September of 1986? 

A 1986? Still falls within the time frame. 

Q Just — I think you were answering as I was asking, 
so I want to make sure the question gets clearly on the record. 
You don't have any — this doesn't help you refresh your memory 
as to the time, but you are able to say that you recall that 
Mr. Zucker met Mrs. North in Philadelphia when he was there in 
Philadelphia f or ^^ ^j3ji:^ose of handling some "Fojjrway" business 



irrei^imi 



578 



UNClASSra 



23 



1 

2 
3 
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6 
7 
6 
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16 
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20 
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A That is correct. 

Q IS there a will or some equivalent kind of testa- 

mentary document in connection with the $200,000 set aside for 
North? 

A You mean that I prepared? 

Q Or that you are aware of? 

A No. 

Q Is there a — to your knowledge, is there a separate 
fiduciary agreement between North and Zucker or Mrs. North and 
Zucker relating to this $200,000 set aside? 

A I am not aware of it at this point. 

Q Did you have a chance between the last — yesterday's 
deposition and today to discuss any of this with Mr. Zucker? 

A No. Definitely not. 

Q Or anyone else to refresh your memory other than 
your lawyers? 

A No. 

Q Did CSF or Zucker or you, to your knowledge, involve 
either of the Norths in einy real estate deal in Arizona? 

A I don't know; no. 

Q That doesn't ring a bell at all? 

A No. 

MR. VAN CLEVE: I have a couple of follow-up 
questions. 



UNCLASSIFIED 



579 



UNCIASSIHED 



1 EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE 

2 BY MR. VAN CLEVE: 

3 Q There are a couple of things about this situation 

4 that I don't think I understood from the testimony both 

5 yesterday and this morning. 

6 You told us that you first became aware , at least 

7 I think you told us, that you first becsune aware that North wai 

8 having personal problems through Mr. Secord; is that correct? 

9 A That is correct. 

10 Q What exactly did he tell you about North's 

11 personal problems? 

12 A Well, it was talking about all of us, all the wives. 

13 Mr. Secord was not far from also separating from his wife 

14 either, you know. It was — we were talking about the pressuri 

15 of all these on all of us, in that context it came about. 

16 Q He said there was a lot of pressure on North, did 

17 he? 

18 A Yes. 

19 Q And did he — what did he say about the effect the 

20 pressure might have on North? 

21 A You mean as far as Mrs. North is concerned? 

22 Q Mrs. North, or the way it was affecting North's 

23 performance of his job, or his relationship with Secord, or 

24 anything like that? I mean, I assume when this was first 

25 brought up, it was really. biiPualif^t^fe^Abusiness matter; anc 



immB 



580 



UNCUSSIHED 



25 



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2 

3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
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16 
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18 
19 
20 
21 
22 
23 
24 
25 



Secord is telling you we are dealing with North, North has a 
problem. 

A Business matter? 

Q In connection with the — I gather it would have 
been in connection with the operation you all were involved in. 

A No . No . 

Q That it would have come up? 

A No. That is a misunderstanding. It came about as 
sort of the talk about how to let out steam. We are — you 
know, we are so deep in this and we are working so hard that 
it is affecting our fjunilies. And has affected North's 
family and wife more than anyone else because he's never home, 
doesn't eat properly. His wife has had it. 

Q That is — I understand that. That is a very 
legitimate human concern. What I am trying to get at is did 
General Secord draw any conclusion from that about North's 
performemce that it might be affecting the way he was doing his 
jc^, or his decision making, or anything like that? 

A Oh, now we are moving away from the family, coming 
to Mr. North? 

Q Right . 

A Oh, I see. I am sorry. 

Q No. That is okay. 

A He regularly made remarks about North's eibilities 
and the way he performed. He was at all times — Secord — so 



IINPI im\[li 



581 



UNClASSra 



26 



1 

2 
3 
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6 
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was I, amazed as to how this man could function under all that 

pressure. 

I believe he worked on two, three, four hours of 
sleep and maybe one meal a day, maybe. That was -- he only ~ 
we talked about it. He is an amazing man, so devoted. He 
doesn't care about -- I specifically remember that at one point 
I suggested to him to go through the same health farm that 
Secord and Tom Clines went. He thought I was nuts. He did. 
I know how much he wants to take his — I believe it was his 
son — I really haven't met his family — mountain climbing, 
something. 

He said if I could find him, I would take my son 
mountain climbing or whatever it was. He is an extraordinary 
man. I haven't seen anything like him. 

Q I guess I can be a little more direct. I do not want 
to put words in your mouth, but was the concern ever expressed 
to you that unless something was done about the pressure that 
North was experiencing, he would crack up? He would have an 
eaotional breakdown of some kind? 

A Oh, no. Never. 

Q You never heard anything mentioned like that? 

A Never . 

Q By Secord or anyone else? 

A No. If I would have heard this from anyone, I 



would have challen 



Ml mm 



— I v:as present 



582 



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12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



vftmsim 



27 



"under very, very tense moments, hours. When I say hours, I am 
talking about 10, 15, 20 hours, that what I saw from the tapes 
of hearings, that is chicken feed compared with the times that 
we went through, especially with the second channel. 

And how that man operated, I just — he is all, by 
the way, taped and recorded. He is an amazing man. There is 
no question. If anyone would have come told me he is cracking 
up, I would have definitely objected to that judgment. 



So that was not the purpose of trying to help North 



out? 



No. 



Was it to avoid that kind of problem? 

No. No. It was solely emotional. It was 
basically — he was and is a soldier through and through. He 
loves his family, but, you know, he is obsessed with getting 
killed for his country. Honestly. I think he is searching for 
a way. I may be totally misunderstanding him, but the man is 
prepared at any time to give his life. 

To him, that is the greatest thing that can happen 
to him. So he is — he is a very unusual character. A man 
like this will never crack down. He has so much love for his 
country and so much love for people. He has demonstrated that. 

In addition to that, he is very religious. One thing 
that never stood in his way — I know that from personal 
experience, if I ever called him Sundav morning , he was gettinc 



ever caiiea mm sunaav m 

IINCLASSIFIFh 



583 



UNCUSSIFIED 



28 



1 ready to go to church, by God he would call me names. He 

2 would. 

3 Q I think you told us yesterday that when you told 

4 Secord that you wanted to try to help North, he didn't want to 

5 get involved in that; is that right? 

6 A When I told him — started to tell him how I wanted 

7 to do that, he said, "Leave me out of it. I don't want to know 

8 about it . " 

9 Q Why is that? 

10 MR. JANIS: He can't know why Secord would have 

11 said that. 

12 Do you know what was in Secord' s mind? 

13 THE WITNESS: I can speculate. 

14 MR. JANIS: Okay. You can speculate. 

15 THE WITNESS: The total — please forgive me. I 

16 heard this morning a remark from my attorney that Mr. Nields 

17 has to listen to me for a long time to get a few ounces of 

18 information, and that immediately gave me an idea that maybe 

19 we can turn that into a business venture because — 

20 MR. JANIS: You don't need to go into it. 

21 THE WITNESS: I want to. I want to. Sometimes when 

22 I talk, they say, "Well, you didn't put the point across. 

23 You didn't talk enough." 

24 Sometimes when I talk, they say, "You are talking 

25 too much." I don ' t Juip^ tfh^r^ iji tjie keJrl to draw the line. 



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MR. JANIS: There was a question here. 
THE WITNESS: What was the question, sir? 
BY MR. VAN CLEVE: 
Q The question was, if you know, why did General 
Secord not want to get involved in your efforts to help Mr. 
North? 

A So you have to be patient with me to answer that 
question. 

Q Apparently so. 

A I believe it had to do with the total concept of the 
structure of this unusual operation. It was a situation that 
everything was a known secret. They didn't want to know, then 
they wanted to be able to say they knew. It was business; it 
was government. I testified to that. 

It was -- it was genetically the same reason. That 
is my speculation. I don't know why Mr. Secord said that. 

MR. VAN CLEVE; Okay. I don't think I have anything 
further on that. 

Thank you. 




Un'jtnOOc^ ' 



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■ kit <»• • 




30 



1 "'- EXAMINATION ON BEHALF OF HOUSE SELECT COMMITTEE 

2 BY MR. NIELDS: 

3 Q I would like to pursue that. I intended to earlier 

4 and I forgot. 

5 I think you testified today that you originally 

6 proposed a $500,000 set aside? 

7 A That is to the best of my recollection, yes. 

8 Q And that Secord objected. I think you said what he 

9 said to you was you don't understand a soldier's life and 

10 something about it being money from the government. 

11 Can you be a little more specific about what his 

12 objection was? 

13 MR. JANIS: Just for the record, I think what he has 

14 testified to was that General Secord said you don't understand 

15 a soldier's life; at any rate, there are benefits he would 

16 receive from the government. 

17 BY MR. NIELDS: 

18 Q Is that correct? 

19 A That is correct. 

20 Q I see. Okay. 

21 Was he objecting to — at that point, was he 

22 objecting to the quantity of the money or was he making some 

23 other kind of objection? 

24 A There is no question that he was objecting to the 

25 amount. Then he (lla|so knew my feelings about the situation. 



iiNni mm 



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What really constituted his objection, I think — I cannot 
speak for him. 

MR. JANIS: Wait a minute. 

Make that clear. 

THE WITNESS: The bottom line, I testified earlier 
that he did not object to the $200,000. I am on the record for 
that, but I can -- I don't know what his motivations were, but 
he agreed to the $200,000 and he did not agree to the $500,000. 
That I can tell you. 

BY MR. NIELDS: 
Q Okay . 

MR. JANIS: Are we through with this area? 

MR. NIELOS: I think so unless someone wants me to 
ask this question. 

MR. JANIS: Can we take a short break? Maybe you 
can get him some coffee. 

[Brief recess.] 



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MR. NIELDS: Let's go back on the record. 
BY MR. NIELDS: 

Q Mr. Hakim, I would like to ask you some questions now 
on the subject of the Iranian initiative. 

I think maybe the best way to go about it is for you 
simply to tell us how the Iranian initiative first came to your 
attention. You did this to some degree yesterday, but we might 
as well cover the whole subject now. 

A It first came to my attention when General Secord 
felt that he needed assistance in dealing with Mr. Ghorbanifar 
and basically trying to locate him. He had a hard time to 
deal with the people in Paris, calling them, trying to under- 
stand where he might be, and so he asked for ray assistance and 
I managed to locate where the gentleman was and passed informa- 
tion on to him and then he would contact him and talk to him. 
That's how it started. And then — 

Q Your recollection is that at this point in time, 
Secord was in this country, not wandering around Europe? 

A That's correct. That's correct. 

Q And your best recollection is this was late 1985 or 
very early 1986? 

A That is correct. That's also correct. 

I beceune more involved when I was in -- I believe I 
was in Geneva and General Secord called me. He could have been 
in the States. I'm not sure, or he could have been in another 



588 



VNGlASSm 



41 



location outside of the United States when he called me and 
said that if I would be willing to assist with the translation, 
because they have been unable to get a suitable person for that 
purpose. 

Q Let me just stop you there. At the point at which it 
was discussed with you that a translator was needed, what did 
you then understand the Iranian initiative to consist of? 

A My understanding was — and later on it was sub- 
stantiated that the United States was seeking a way of 
reestablishing relationship with Iran. That was my understanding 
of it. At that time there was no issue of hostages, weapons 
as such discussed with me. 

Q Okay. I want to ask you this question, then: Were 
you — I take it there were various kinds of contributions that 
were made into the Lake Resources account for the benefit of the| 
contras that you were aware of? 

A Yes, sir. 

Q Were you told who had made the contributions? 

A No. Never. 

Q In no instance? 

A Not that I can recall. 

Q Just to make sure I have this on the record accurately 
there were at various times in '85 and '86 at least three, 
$1 million deposits — 

A Oh. Oh. When you say contributions, I immediately 



When you say contributioi 

UNflU^SinED 



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UNClASSinED 



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focus on the contras . Is that what your — what's our point of 
reference? Are we talking about Iran now or talking about 
contras? 

Q I am not certain — I am talking about three, 
$1 million deposits and I'm asking you whether you were aware 
at the time those deposits were made — they are reflected in 
the records that you provided to us . What did you know about 
where that money had come from? 

A I had no idea. 

Q All right. 

Now, you were about to say in connection with the 
Iranian initiative, you were aware of the source of certain 
monies? 

A When I — I was aware when the monies — at a later 
date, that monies were paid for purchase of weapons. You said 
contribution. I attributed that to the contra effort and then 
you said monies received — 

Q To pay for — 

A Then I made the distinction that monies received — 
that I was aware that it came for the purchase of weapons. 

Q Okay. But other than the monies that came for the 
purchase of weapons, you didn't know what the source of the 
contributions were? 

A That is correct. 

Q And — okay. Let's pick it unw^^where I 




590 



UNCUSSinEB 



43 



interrupted you. I think you were saying that at the time you 
were asked for a translator, that you understood there was an 
effort to reestablish ties with Iran and you didn't know anythin 
about arms or hostages then? 

A That is correct. 

Q Okay. 

A I basically accepted to help with this effort under 
objection because I have testified earlier that I do not find 
Mr. Ghorbanifar a person that I like to be associated with. 
Richard explained to me that they had failed to get any other 
interpreter, and I said, fine, if this is the case, I'll be 
more than happy to assist. 

Then he immediately wanted me to make reservations 
the the airport ,^^^^^^^^^^^^^^^^^^H in Frankfurt 

and be there earlier and expected the group to arrive. So I 
did so. Finally, the people arrived from various places and 
we were sitting, Richard and I and I believe also the CIA 
official or he could have come together with Ollie, I don't 
remember, but there came a time that for the first time I got 
to be introduced to Oliver North and the CIA official. 

Q This was in Frankfurt? 

A This was in Frankfurt in the room of Oliver North. 

Q Was there an issue about — that had arisen earlier 
about whether you would appear in disguise? 

A Well, no -- this — when Oliver North came in and 



liNPi hm\fi^ 



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then — with the CIA official, Richard and I, he started to ~ 
the first time say, okay, I was brought into this cold, what am 
I supposed to do, what's going on, I'm not prepared; and then 
I was aware of the earlier attempt of General Secord to bring 
me into this and Mr. Ghorbanifar had very seriously objected to 

that. 

And so there I'm sitting there and said to the group, 
I certainly would remember Ghorbanifar. There is no reason 
that he would not remember roe. So how do you want me to go 
into this meeting. 

So they turned to the CIA official and said, do you 
have somebody that can disguise Albert, and the guy said, by 
the time I go through the bureaucracy, it will be the end of 
the meeting. 

So Oliver North turned around to me and said, I've 
heard from Richard that you're very resourceful, why don't you 
go and disguise yourself. I said, thanks. 

So I left the hotel, came down to the confierge, said 
1 need to buy a gift for my father and I want to get a wig for 
him. Where is the best place to go? 

So a lady is looking at me, said ~ gave me a couple 
of addresses, recommended one. I got a cab. I went to the 
place and the lady started to go through all kinds of salesmansh 
to sell me the best wig and if I wanted to swim, I didn't want 
to swim and I'm sitting there knowing that the meeting is going 

UNCUS!;iFIFn 



592 



UNtUSSJFIE 



45 



to. start very soon and I cannot — lady, let's get on with it, 
I don't give a damn, just give me a wig. 

So she goes and brings me a number of wigs to select 
from. This has that advantage, this one this. Finally, to 
make a long story short, I said, this is beautiful, just let's 
try it on. And so we tried it on and I looked at myself, I 
said, oh, this is not good enough. I said, I don't like the 
style of this. Do you have a barber? They sent me to the 
basement. There was another lady. I said, I would like my 
hairdo in this form. We managed to shape it in such a way that 
it didn't look like me. 

And I normally don't wear eyeglasses, but I have a 
pair of folding eyeglasses that I carry in my briefcase. I put 
that on and walked into the room and those three guys were just 
shocked, amazed. They didn't think that there was a chance for 
Ghorbanifar to know who I was. So I was prepared. The funny 
thing was that by then the Israeli agent also came in. They 
briefed me a little bit, what was going on, what was expected 
of me to do, and they told me this was an acrobat. I was M 
supposed to be two places at the same time, translating. Of 
course, the final decision was that they were going to hold a 
political meeting and they were going to hold a military meeting 
and these two meetings were in two different hotels; and one 
interpreter. 

So we managed to get around that so I would rush from one 



I to get around tnat so I 

UHCLASSra 



593 



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WKi Jt.v 

meeting to the other; but the strange thing to me was that the 
Israeli agent comes in and — a young looking gentleman, and he 
says, well, sitting with these Iranians, they respect people 
who have white hair; they have more value for them. I had to 
take the Israeli guy with me to go to the same place that I put 
my wig to get some spray to make him look older. That mission 
was given to me as well. 

Q Do you remember the name of the Iranian — the 
Israeli? 

A Nir. So I'm waling with this Israeli, going to — - 
downtown area. He's not supposed to know who I am. And that 
was a challenge, really, to spend 45 minutes with a guy and 
act like a spy, something thadl'd never done before. 

So we got over all that and then Mr. Ghorbanifar — 
we came back. Ghorbanifar came in and further coordination was 
made with him and we arranged how, where, who was going to be 
present for the meetings. And it was at that time that they 
decided to have two separate gatherings, one with Mr. Ghorbanifa 
the Iranian representative, the official of CIA, Mr. North, 
and myself and a second meeting right after the first meeting 
in a different hotel with the CIA official, General Secord, and 
myself and the Iranian group. 

Q All of the Iranian group or just the military people? 

A Just the military. Different. We segregated the two. 

Q I take it the meetings were to take place one after 



t the meetings were to ta 

IJNCLA^SiFIFn 



594 



UNCLASSiHED 



47 



the other? 

A That is correct. I finished one meeting and got into 
a cab, ran to the other one with Mr. Secord and the official 
from the CIA. 

Q Was the subject of arms for hostages discussed with 
you in preparation for these meetings? 

A Not that I recall. They basically explained to me 
what was the objective of the United States. They said that 
they wanted to reestablish relationship with Iran. It was 
important, and they did not really tell me what the Iranians 
expected out of this . There was not time to brief me ajiy f urthe 
So this was — this time it was — if I'm not mistaken, we had 
a social visit with the Iranian and then our official meeting 
started the next day, because it was pretty late by then. But I 
could be wrong that we did not meet the Iranian official until 
the next day in his room and he had prepared breakfast for us 
and we had a discussion before going in there with the CIA 
official as to how to tape the recorded discussions, and he 
brought his machine in his briefcase and he finally managed to 
place the briefcase in a place that would serve the purpose and 
then Iranians would not get jittery about seeing a briefcase 
there. They don't like that. 

He may have used his pocket. I don't remember. He 
hung his coat someplace with the recorder in it. But the point 
is we managed to the best of my knowledge to record the events 



I 



he best or my knowledge t 

UNGIASSIHED 



595 



VNCussra 



48 



of that day. 

Q Did you function as the translator? 

A This is what I was about to tell you. I found myself 
very quickly that they needed more than translator. There was 
such a gap in communicating and I'm not talking about the subtle 
type of interpretation as we have referred to in my talk with 
yo" . Big gap. Just -- they were coming from two different 
worlds . 

Q Could you describe that further? 

A Here is an American group very sophisticated, worldly. 
They have in their past experience been involved with inter- 
national affairs, you know, totally at the level of exposure 
was at such a point that the Iranian representative could have 
never gotten to that point. Here they come, Americans with 
a very, very different attitude and there is effectively this 
gentleman that later on I l earned that he -- prior to t he 
revolutic ^^^^^^^^^^^^^ 

could -- his knowl« 
embarrassing, and so such a big gap. You know, sitting there, 
I'm sitting in the middle, my God, and they are sitting — 
Mr. Ghorbanifar is trying to be the — right in open to be 
the mouthpiece, and adviser of this Iranian gentleman and at 
the same time right in my presence trying to misrepresent the — 
the idea was for me to sit there and watch Mr. Ghorbanifar and 
see how he translates and keep him honest. Very soon I found 




iiNfii mm 



596 



ONClASSra 



48-A 



Ottt that I have to — I better take a more active part in this 
because the man had no hesitation, knowing there was a Farsi- 
speaking man sitting there and understand Farsi well, he was 
not shy to lie effectively in his interpretation of what was 
going on. 

Q Can you think of an example? A specific example? 

A No, Mr. Nields, but I am very sure if one would refer 
to the tape, it would be available there because I took serious 
objection and I made — I wanted to end that nonsense very 
quickly and once and for all. I said very openly without being 
bashful that this is wrong interpretation and translation, 
should have been this. 

Q Did you say this — 

A To Mr. Ghorbanifar. 

Q — in English or Farsi? 

A Both. 

Q So the Iranian could hear you? 

A To the best of my recollection I did it in both. 
I wanted the Iranian representative to understand where I was 
coming from. And I started to address him, and then I did it 
in English. 

So I found myself, to answer your question, that I had 
to also bridgel the cultural gap in addition to the language 
problem. And that mission was accomplished but my — what I 
recall from what happened in the jneetiufl J<as until to the bittej 




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49 

end of the meeting, they were not communicating. They were — 
on two different frequencies. Oliver North, who was heading the 
delegation, was talking about long-term relationship, how we — 
the United States thinks of Iran, how important Iran is for 
the United States, how they want to evolve inpltl a better 
relationship and saying that the United States has recognized 
and accepted the revolution and has respect for them and wants 
to — 

(Discussion off the record.) 

BY MR. NIELDS: 

Q Why don't you finish your answer? 

A And the Iranian gentleman is sitting there and all 
this is being translated to him as if it was never spoken. He 
goes back and he talks about Volkswagens. 

Q About what? 

A I'll come to it in a minute. It is okay to — by 
that he was referring to — is it okay? 

Q Yes. 

A He was referring to code name for Phoenix missiles. 
That was Volkswagens. 

So you were in the seune room, thinking that we are 
trying to establish relationship between two countries, Oliver 
North sitting there and thinking that he's talking to at least 
somebody from a more — an Arab country, at least at that level. 



IINHI ASSIFlc 



598 



UNClASSinED 



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Tliere he is, this gentleman who has never been into anything 
as such except he was a businessman. He didn't even focus on 
what North was saying. He kept on saying what about our weapons 
and they talked a little bit about — I believe they talked 
about Hawks and TOWs, but Oliver North tried to bring and direct 
the discussion to more of the long-term relationship, and then 
this man would go back and say, what about the Volkswagens. 
That's all I remember, the focus of it. A lot of details were 
discussed but they were going past each other. 

Q Just to make sure I understand, at this point in 
time the person who is speaking about Volkswagens? 

A Is the Iranian representative. 

Q Not Ghorbanifar? 

A No. By this time I had taken a more active part. 

Q You are now doing the translating? 

A Most of it, yes. I believe to impress the Iranian 
a little bit of exaggeration was added to this in introducing 
me as the special translator of the President of the United Stat 
and that got me into trouble because when the meeting was 
finished with this gentleman, he tried to catch me in the 
corridors alone to take special message from him directly to 
the President of the United States and he said I should whisper 
that into his ears and get him to take care of the Volkswagens 
right away. 

MR. NIELDS: Can we go off the record? 
(Discussion off the record.) 



UNCLASSIFIED 



599 



IfLASSIFIED ' 

BY MR. NIELDS: 

Q Where were we? It was where you went outside the 
room and he wanted you to send a special message to the Presiden 

A That was at the later time that he cornered me when 
I was standing with General Secord in the lobby and pulled me 
to the Side and by then he had become -- he thought he became 
very close to me and started calling me on a first name basis 
and adding the word for intimacy that is referred to as something 
like "Brother*;. Brother Abe, that's the name — 
. Q Abrahcun Ebraham? 

A Richard I believe didn't remember. It was Ebrahim 
Ebrahimian. That's what I us« 




have photos of myself with that wig on. A very interesting 
picture. 

Q You do have photos of it? 

A Yes. I have photos of it. 

Q Did you bring them with you? 

A No. Itisat home. 

Q Home is California? 

A California. I'll be more than happy to provide you. 

Q I think we would like to see that. 

A Yes. So I still have the wig, too. 

MR. WECHSLER: Why don't you wear it during the 
hearings? 



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THE WITNESS: Something very interesting happened. 
I don't need this thing to be publicized, because I don't think 
it will help the relation of the two countries, but I think I 
should bring that out to help the responsible agencies who may 
want to pursue re-establishment of relationship with Iran to 
understand their psychology a little bit better. So it may 
sound funny when I explain to you what I have in mind, but it 
is a very important issue. ^^^^^^^ 

When this gentleman, ^^^^^^| cornered me in the lobby 
with General Secord being there — 

(Discussion off the record.) 

THE WITNESS: I was about to tell you about the issue 
that I considered important as the educational matter. When he 
asked me to take a special message to the President of the 
United States, there was no question in my mind what he was 
trying to tell me, knowing the culture and -- so well. He 
wanted me to see if I could strike a deal for the President of 
the United States, a financial deal, to see if the President. 
could consider being motivated somehow financially to give 
him the Phoenixes . 

BY MR. NIELDS: 
Q In other words, whether there was a way a lot of money 
could be made available to the President, and then he would give 
Phoenixes to the Iranians? 

A Yes. That was the attitude. Okay? What he 



UNCLASSIFIED 



601 



whispered into my ears is that Brother Abe, you know what I 
mean, why don't you when you are alone together sit down, pull 
him to a corner, and see if you can strike a deal. That's very 
important. If I'm given an opportunity, I really would like 
to elaborate on this issue, not on this incident, but on this 
issue. It is very important for our politicians and diplomats 
to understand who the Iranians are tod^y. I have had ample 
opportunity not only based on my previous experience of living 
there and dealing with them. I had the greates't opportunity 
of touching and feeling and understanding these people and all 
the different factions and what this gentleman represented is 
not at all the type -- an example of the kind of people that we 
later on established as the second channel. It is very different 

And if one would not understand the psychology of 
these various factions and how they operate because we do not 
have any human intelligence in there, we have no information, 
it is going to be a very, very difficult communication if they 
ever try to again communicate with these people. There's 
a lot of work and preparation to be made to talk to these 
people again. The gap is immense and in the second channel, 
we managed to close that gap. We will get into that separately, 
but I know I'm a businessman but when it comes to dealing 
with people, especially with my background in marketing, I'm 
a pretty good judge of character, of people, where their mind 
is at. So I can be helpful in that respect. 



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54 

So to go back to the substance of this, the -- this 
meeting was finished with the understanding that a meeting 
should be arranged in Iran for the higher officials to meet; 
and the location that was recommended for this place was 
Kish Island, which we referred to later on during numerous 
telephone conversations by the way, since you are asking me 
my involvement in th° first channel, I had many, many telephone 
conversations with this^^^^^B f rom Vienna, Virginia from my 
office to Tehran. He called me — I called him, I called his 
office, his home; his other associates called me. So there 
should be -- and all of these, I taped it and give the tape to 
be given to the CIA. So there should be tapes on that as 
well . 



UNCIASSIRED 



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Take 3 
DINKEL:mhl 
Monday 



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BY MR. NIELDS: 

Q These are tapes of telephone conversations between 

you and the Iranian representative? 

A And this 

Q And you made those tapes available to the CIA? 

A I made it available to General Secord, to make it 
available to the CIA. So — 

Q Just getting back before these conversations, I 
want to finish up on the meeting in February in Frankfurt. 
Did the subject of — At the political meeting -- did the 
subject of hostages come up? 

A I cannot recall that. I honestly can't. In the 
sense that -- you see, I am biased. The reason I am biased, 
I am sitting here with you after having gone through very 
tense and serious negotiations with the second channel, where 
the issue of hostages were discussed in great detail. 

To the best of my recollection, the way it was 
presented to them was referred to as obstacles. 

Q Where, at which time? 

A I am talking about the February meeting. Was 
referred to -- it was not -- the focus of the discussion, 
and the tapes will verify this, but my recollection was that 
as soon as we can remove the obstacles that are in our way, 
we should be able to have a grand time in establishing our — 
reestablishing our relationship. That is what I remember to 
have been our position, the Americam position. 



iiKin AQQinrn 



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UNCUSSinED 



56 



Also, at the same time, I remember the Iranian 

1 position was forget about all of this nonoena, where are 

2 the weapons? Of course, they were going past each other. 

3 Q Were you aware that some weapons had already been 

4 shipp^ed at the time of this meeting? 

y 

5 A I don't believe I was. I don't believe I was 

6 informed of that. 

7 Q Now — 

8 A You are referring to the Israeli shipment? 

9 Q No. I cun referring to the shipment of 500 Tows 

10 very shortly before the meeting by the U.S. 

11 MR. VAN CLEVE: This probably would have been a 

12 couple of days before the meeting. 

13 THE WITNESS: I don't know — I don't believe they 

14 told me that at that time. 

15 BY MR. NIELDS: 

16 Q How about the money into the Lake Resources accoun 

17 There was about $5 million deposited into the Lake Resources 

18 account? 

19 A I was aware of that but I did not know if it was 

20 really as part of this package. You understand what I am 

21 trying to say? 

22 Q I do. But I still want to pursue this. It might 

23 be significant. Wait, Wait, listii to my question. 

24 A Yes sir. 

25 Q What j%i^ your understanding of what this $5 million 



ICUSW 



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was? 

1 A For sales of weapons. When, how, -- to Iran. 

2 Sales of Weapons to Iran. When, how, what, I did not know. 

3 Q Oh, I see. You knew that there was an arrangement 

4 already underlway pursuant to which weapons would be shipped 

5 by the U.S. to Iran, but you didn't know if they had already 

6 gone or if they were going to go in the future? 

7 A Exactly. I was aware of the money transaction. 

8 I was not aware of the actual weapon movement, if you will. 

9 It was shipped — I didn't know the terms of agreement. 

10 Q Am I understanding — my understanding was Secord 

11 went to Israel to supervise this shipment. Were you aware 

12 of that when it happened? 

13 A I have no doubt in my mind today, and I had no 

14 doubt in my mind then that it was not a clear decision whether 

15 it was going to be used in this initiative. So it was not 

16 unusual and I have said that Secord is a very, very secretive 

17 person, when it comes to government activities. He would not 

18 taHTf. more than what is necessary. So that is why -- and as a 

19 matter of fact, later on, I learned that they decided not to 

20 keep me in the loop and George Cave effectively replaced me. 

21 So it was n«Ki=^d=a»*>K. or aufe^i^ illogical for me not to know 



UNCLASSIHED 



22 the details. 

23 Q And now - 

24 A But wait. There is one other thing I would like 

25 to point out that I just recall now, since we are talking 



606 



25 



UNCLASSIFIED 



58 



important issues. I do recall that I went out of my limits 

1 prior to the meeting in — during the time that Nir, the CIA 

2 official, Secord and North were present. I expressed my great 

3 concern about the health of a — of the relationship to be 

4 established with the help of Mr. Ghorbanifar and his group, 

5 Mr. NimFOdi ^"*^ s° °"' These people whom I know extremely 

6 well for many years. When I say know extremely well, I have 
^ dealt with them. 

8 Q With Ghorbanifar, Nimrod — 

9 A Yes. 

10 Q Schwiromer? 

11 A Schwimmer, I know of him. Is Schwimmer the same 

12 person who was the head of the Israeli aircraft industry? I 

13 have so much information about these people that — 

14 Q J|ow did you know them and what do you know about 

15 them? 

16 A Well, if you recall, I told you I represented 

17 Motorola. Motorola estsiblished the memufacturing plant in 

18 Israel, Motorola-Israel. We were finally assigned from 

19 Chicago to Israel because gq the geographical division that 

20 Motorola made at the time. So I had for Motorola dealings 

21 with Israel, and Mr. Nimfodi ^'^^ ^^^ so-called military attache 

22 of the so-called I ran i an .\ Sorry, the Israeli Embassy in Iran. 

23 They were physically there. They had a building, all that, 

24 but officially, they were not there. 



ONCLASSinEH 



607 



iwcussiFie 



59 



So we were both — when I say "we" meaning I, 

1 in Telecom then, and Mr. Nimrodi called him Nimrodi then, had 

2 the same clients, Iranian military, and that is how I knew 

3 Mr. Nimrodi because there were times that we got them involved 

4 Telecom got them involved for the interest of business in 

5 Israel, i.e.. Motorola's business. So I had the opportunity 

6 of getting to know Mr. Yacikov NiiTodi extremely well, on a 

7 personal basis. 

8 Q Were you a friend of his? 

9 A Also a friend of his. 

10 Q And what was your opinion of him? 

11 A When? At the time of the meeting? Or — 

12 Q Well — 

13 A Today? 

14 Q Well, I was thinking at the time you knew him in 

15 Iran? 

16 A As an official? It makes a big difference, you 

17 see. 

18 Q Tell us all. 

19 A I would like to put this very mildly. I did not 

20 find it normal, ususal practice for a person in his position 

21 to handle the Israeli transactions in the memner that he did. 

22 I do not really want to be the cause — I know the difficulti< 

23 and the investigations that are going on, or were going on in 

24 Israel aLout him and his dealings — if I can be excused not 

25 to get involved in that unrelated issue that may just 



t. ' ■ 5 ■: •. •. .^> 1 ? . V .• •.■ i - • ' 



608 



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 



UNCUSSIHED 



60 



cause embarrassment for Israel -- it would be nice. 

But mildly putting it, I did not approve or — 
I shouldn't say I did not approve. I found it strange way 
an Israeli official represented his country in transactions 
with Iran. In this country, you would not find that ethical. 

MR. NIELDS: Lets go off the record. 

(Discussion off the record) 

MR. NIELDS: Let's go back on the record. 

BY MR. NIELDS: 
Q Okay. Yqu just finished telling us about Mr. 
Nimrodi. 

A And I also had first hand knowledge cibout Mr. 
Ghorbanifar. He may not remember the circumstances, but I 
had met him and I also was aware that — I have been trying 
for a long time to remember the name of the man that worked 
for Mr. Nimrodi who effectively recruited Mr. Ghorbcinifar 
then when he was working in this Star Line Shipping Company 
in Iran. 

He was working — I don't know whether he was 
— under a contract with Iranian Savak or whether he was 
actually an en^sloyee, but there was no question in my mind tha 
he had relations with Savak. He was a double agent starting 
then. 

Q This is Ghorbanifar? 

A Ghorbanifar. And I also knew that he — I don't 



liNRi tmm 



609 



16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



BNClasinfS 



61 



know whether he has kicked the habit or not, but I also knew 

1 that he had if not cocaine, but definitely opium addiction. 

2 Q Ghorbanifar? 

3 A Yes. 

4 Q Is there a distinction between opium addiction and 

5 heroin addiction? 

6 A No. Now, I recall being present in a social 

7 gathering that he was there and he was bragging about how he 

8 used to get — for his use cocaine from Pakistan or something 

9 like that. 

10 Q And opium was something he smoked? 

A Yes. Opium in the Ir2mian society, like the 
Chinese, use of limited amount of opixim — I do not mean to 
be sarcastic, but they consider that to be good for one, if 

14 one smoked a limited amount of that. As a matter of fact, 

15 the laws in Iran then were such that people had coupons that 
they could officially go to government institutions and get 
their ration and at the szune time in Iran, if they caught 
people illegally dealing with the druts, without shadow of 
a doubt, they would be executed. There were both extremes. 

Q Let's go back to the February meeting. Is there 
anything more that you should tell us about the political — 

A I was about to tell them that I did not think that 
this combination would lead them toward where they want to go. 
I expressed that opinion. I saw Nir's ears going up, and he 
was anxious to cms3 .examine^ me and we managed to wiggle out 



IffiSlFiFli' 



610 



UNcussm 



62 
of that discussion and not to get involved. 

1 Q How about the military meeting? You haven't told 

2 us anything about that yet. 

3 A The military meeting I classified Richard Secord, 

4 the CIA official, they may have a different opinion. I don't 

5 believe we impressed the Iranians in that meeting, and they 

6 sort of expected that. They didn't expect us in the first 

7 meeting to come out and all make it. They were not impressed. 

8 But the point that we wanted to make was made. 

9 Q Which was? 

10 A Which was that we could help them with military 

11 intelligence and the reason I don't want to appear contradict- 

12 ing myself, we did not impress them because they — the 

13 Iranians continue to believe that we are not to be trusted. 

14 That is a very important factor for to always remember. They 

15 saw that we h ad^^^^^^^^^^K Obviously they knew we had 

16 ^^^^^^^^^^B but they saw it in our hands. So they knew that 

17 we had something that they could make use of it, but we did 

18 not impress them because they did not believe that we were 

19 showing them something that was accurate. 

20 So I suppose as far as the U.S. objective was 

21 concerned, we achieved what we weuited, which was to show them, 

22 guys this is what we got, we are prepared to give it to you. 

23 So that — 

24 Q Okay. Okay, So following that, I take it you ther 

25 had these series of telephone conversations with — 




611 



UNCIASSIHED 



63 



MR. VAN CLEVE: I have a couple of follow-ups. 

1 MR. NIELDS: Do it now. 

2 BY MR. VAN CLEVE: 

3 Q Did there come a time at the end of these February 

4 meetings when you learned the United States was going to ship 

5 an additional 500 Toms' to Iran, right at about that same 

6 time? Are you at all familiar with that? 

7 A I don't believe I am. I don't really recall about 

8 this. 

9 Q Second, was there any discussion at this time, or 

10 even somewhat later, about any personal financial gain for the 

11 Iranian official about setting aside some of the money that 

12 was being transferred for his personal use or for personal 

13 use of other officials? 

14 A My position is still, Mr. Van Cleve, the same. 

15 There was no decision to bring me into this operation at that 

16 time, so I was not privy to a lot of information. 

17 Q Just one more, if I could. If you know, was there 

18 any agreement at these meetings or within the next month or 

19 so, about an agenda for the meetings that were supposed to be 

20 held at a higher level? Was there any agreement about that? 

21 A I thought I touched upon that when I said that the 

22 discussion ended by a greeing to have a meeting in Kish 

23 Island at the later date. And the subsequent telephone calls, 

24 they were all related to establishing that agenda. 

25 Q So there was^no agreement at that time on the 




612 



UNClASSinED 



64 



agenda itself, on what points would be discussed? 

1 A Not that I recall, but I doubt very much that I haw 

2 a copy of — did I mention earlier that a resolution was made 

3 for the purpose of the Iranians of the discussion that was 

4 held? 

5 MR. NIELDS: No, you did not. 

6 BY MR. VAN CLEVE: 

7 Q What do you mean by resolution? 

8 A The Iranians are — they have their own bureaucracy 

9 This man had to go back with some sort of resolution of the 

10 meeting, what happened, or a memoranduin of the meeting. Mr. 

11 Ghorbanifar asked me to help him to draft, euid I believe I 

12 managed to get a copy of that to the CIA. That was in Farsi 

13 and I wanted to make sure that he is not giving the Iranians 

14 a memorcindum of the meeting that was inaccurate, so I 

15 participated in putting that resolution together and I also 

16 believe that I made a copy for our group. So that should 

17 pretty much tell you what was the spirit of discussion, what 

18 was agreed, what happened. 

19 Q That is very helpful. 

20 MR. WECHSLER: It will tell you that if you can ^ 

21 read Farsi. 

22 MR. NIELDS: Maybe we can find a disguised person 

23 to translate it. 

24 MR. VAN CLEVE: That is all I have. 

25 BY MR. NIELDS: 



UNCUSSIHED 



613 



mih 



mss^"" 



Q Following the meeting you had a series of telephone 

1 conversations with the Iranian representative? 

2 A Yes , a number of them. 

3 Q What was the general substance of those conversa- 

4 tions? 

5 Q More of the same thing. 

6 Q Well — 

7 A More of the same thing that was again — I tell you 

8 I remember the frustration that I had from those discussions. 

9 I don't think I will ever forget it even with my cultural 

10 background that was too much for me. I am serious. Very 

11 difficult. 

12 Q The frustration being the failure of communication? 

13 A Not failure of communication. You know, just 

14 being insensitive to what we wanted. I am continuing to see 

15 that I am right, Mr. Nields. You know, for me I am a little 

16 business guy sitting there, there are all these politicians, 

17 military guys, intelligence guys sitting there. I am touching 

18 feeling the realities, and I knew then that this is not going 

19 to go anywhere. It was so evident for me because, you know, 

20 he kept taking the same approach, what is happening to our 

21 Volkswagans. I had to eofffeacet bizarre type sort of 

22 negotiation on behalf of the U.S. Government with this 

23 gentleman and worrying at the same time that the Russians are 

24 picking up what we are discussing. 

25 It was very frustrating, and you know, the guy was 



ilNCI m\M 



614 



UNCLASSIRED 



66 



trying to strike a deal. It is all business. We are trying 

1 to strike a deal. We went over the same thing a million 

2 times and I tell you, it was a blessing for me when I later 

3 learned that Mr. Cave took over. I didn't want to have 

4 anything to do with that group. 

5 Q Approximately how much after the February meeting 

6 in Frankfurt did Mr. Cave takeover? A couple of weeks? 

7 A The meeting was what, February 2 0? 

8 MR. NIELDS: The 25th. 

9 BY MR. VAN CLEVE: 

10 Q February 2 5th. 

11 A I would say about a month later. The reason I say 

12 that is because I do recall a telephone conversation that I 

13 had with this gentleman. Iranian new year^ starts the first 

14 day of spring, which is approximately March 20. I remember 

15 that I still was involved in this useless bargaining over the 

16 phone at that time, and I think at that time — the reason — 

17 I believe at that time the issue of the hostages — yes, as 

18 a matter of fact, that is true. The spirit of my discussion 

19 with this gentleman got expemded and at this time he had 

20 started to include the hostages, so they were referred to as 

21 boxes and then I started to refer to them towards the end 

22 of the Iranian year as having a new year's present for 

23 American people. So that is why I remember the issue of 

24 hostages becoming also part of my discussion. But still the 

25 focus was Volkswagens. 



yNCLASSIFIED 



615 



ONCUSSIFIED 



67 



We are talking about the relationship, obstacles, 

1 Volkswagens. JusftWo different worlds. So we would say the 

2 answer to your question is four, six weeks, that is my best 

3 guess. 

4 BY MR. NIELDS: 

5 Q In any event, there came a time when you were 

6 essentially cut out of the Iranian initiative and replaced 

7 by the CIA? 

8 A That is right. 

9 Q When did you next come back into the Iranian 

10 initiative? 

11 A I have to qualify first my |ttreference when I said 

12 yes, I was cut out. For all practical purposes, I was cut 

13 \out, but — Mr. Secord used to get my opinion without getting 

14 into the substance of what was going on, get my opinion about 

15 the reaction that he was getting from the Iranians. He was 

16 running it by me to say what was my interpretation. And I 

17 saw more of the same thing. I saw that they were trying to 

18 strike a deal and other country was trying to reestablish 

19 the relationship. That went on for some time until — and 

20 by this time I think I had become now involved in a different 

21 way in this first channel, and that had to do with the 

22 financial aspect of it. I knew that monies were supposed to 

23 come, when to come, why they did not come, started to follow 

24 up on that. That is how I learned about his bank in Monte 

25 Carlo being bankriiot ^ttd, taled^^ a number of times to some 




616 



emm-l 



UNCIASSIHED 



68 



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 



Indians or Pakistanis who ran his operation, started to 
check on his banks, started to do what a businessman would 
do, learned that they are not to be trusted. We could not 
ever, as far back as I can remember, receive a payment on 
time. Never. That gave me ulcers. 

Q Did you know about Khashoggi before the payment 
for the Ha^ spare parts? 

A I don't know what that date is, but I can tell 
you when I learned about Mr. Khashoggi. 

Q When did you learn about Mr. Khashoggi? 

A I — when I found out about this Monte Carlo 
bank, I was told that Khashoggi owns it. 
MR. VAN CLEVE: When was that? 

MR. JANIS: You mean when you received a deposit 
from the Monte Carlo bank? 

THE WITNESS: When I was calling to get the 



deposit. 



it? 



BY MR. NIELDS: 

This would be sometime in May of 1986, I take 



A I don't remember the dates. 

MR. JANIS: Just for the record, there was 
a — the record produced by Mr. Hakim reflects a deposit 
on February 7, 1986, from the bank BCCI Monte Carlo. 
THE WITNESS: And they have a correspondent 



: And they have a corres 

IINniteSiFIFO 



617 



mWUSSIRED 



69 



1 in New York. I think I was talking to their correspondent 

2 in New York. 

3 BY MR. NIELDS: 

4 Q And it was at that time that you learned 

5 Mr. Khashoggi was involved? 

6 A That's when I learned. 

7 Q Did you tell Mr. Secord about it? 

8 A I think I did. I saw the icy face, and I knew 

9 I was right. When he makes no remarks, and then I have 

10 my information, yes. Yes, he knew that. I knew that he 

11 knew. 

12 Q Were you involved in any way, shape or form 

13 in setting the price charged to the Iranians for the 

14 missiles that were sold to them? 

15 A At no time, including the second channel. 

16 MR. VAN CLEVE: Do you know why Cave came in 

17 to take your place? 

18 THE WITNESS: I think I do. I cannot be 

19 certain. Again, they were — I have a number of times 

20 referred to these scattered remarks. I reached the 

21 conclusion based on these scattered remarks at various 

22 times that he was — Mr. Cave was extremely trusted by 

23 Mr. Khashoggi, Director Casey. In addition to the fact 

24 that he — it goes without saying, that he's an expert, 

25 he knows the culture, he knows the language, ail that. 



mn h^mm 



618 



tINClASSIFIED 



70 



1 That's known. 

2 BY MR. VAN CLEVE: 

3 Q You have met him, haven't you? 

4 A Oh , yes . 

5 Q How good is his Farsi? 

6 A His, what I call, technical Farsi, which is 

7 knowledge of terminology for weapons, military structure 
e and such is superb. I had sometimes to ask him for those 
9 terminologies. I don't understand that. His knowledge 

10 of Farsi is definitely good enough to understand what's 

11 going on, understand it well, and his speaking is very 

12 well to put the point across, but I, in my opinion, do 

13 not consider that his Farsi is good enough to tr^act 

14 with Iranians. It takes a different type of approach to 

15 do that, to do that translation. It requires a certain 

16 type of slickness to achieve that. This is not something 

17 that you learn in school . So I would say that that — he 

18 knows quite a bit about the culture. 

19 I have a lot of respect for George. He's 

20 extremely knowledgeable. 

21 BY MR. NIELDS: 

22 Q With the exception of Mr. Cave, and any other 

23 CIA people that attended meetings with the Iranians where 

24 you were present, and with the exception of Mr. North, 
25 



did you meet with any 






t officials 



619 



UNCLASSIFIED 



71 



in connection with the Iranian initiative? 

A Do you also exclude the aides to Mr. North? 

Q You mean Mr. EarjAand Mr. Coy? 

A Right. 

Q Let's include them. I take it you met with 

them? 

/ 
A Yes. Earlj^- yes. I was on the KL-43 with him 

/ 
during the second channel quite a bit. 

Q Anyone else? 

A Just secretaries. You said excluding the CIA 
agents? 

Q At the meetings. 

A At the meetings. I testified that during the 
first meeting, there was a high-ranking CIA official. 




Q Anyone else? Did you ever meet with Mr. 
Poindexter? 

A No. I did not meet with Mr. Poindexter, but 
I — that reminds me. I did have a very short, brief 
encounter with Mr. McFarlane. 



Q When was that? 



A When he c 



DROISHft 



stopped in 



620 



IINClASSra 



72 



1 Israel. I was doing quite a bit of work supporting General 

2 Secord logistically , quite a bit. This aoroloa e ing c/ 

A 

3 arrangement for all trips, every one of the trips, I 

4 organized, managed, included -- that includes the trans- 

5 port of our team from Israel to Geneva and onwards to the 

6 United States. When they stopped in Geneva for refueling, 

7 I met them at the airport, brought them to a special room, 

8 and Mr. North introduced me without giving ray neime to 

9 Mr. McFarlane and there were other — but prior to that, 

10 by the way, I met the group that arrived from the United 

11 States -- when I say "prior to that," I mean prior to the 

12 trip to Iran, the Tehran trip. 

13 There were a number of U.S. employees; to this 

14 date, I don't know from what agency. They Ccime -- I met 

15 them, arranged for their accommodations prior to their 

16 take-off to Israel in Geneva. Met them, arranged for 

17 that. So those people I met, including also communications 

18 people in those — those people. I met the various same 

20 I also recall the looks on the face of the 

21 ^rfT^nTTTi nitr''^ 



whom I was dealing with when these 

22 gentlemen, our boys, ceune out of the plane and pulled out 

23 their suitcase and we went — they asked me where they 

24 could establish satellite communication. Went behind the 

25 building and this aeroleasing guy, looking at us, thinking, 



621 



WUJSIflfO 



73 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 




Here is Albert Hakim, a businessman, what in the hell is 
going on? So we set up our antenna and they communicated 
that they arrived safely and were going back. 

By the way, when Mr. McFarlane was getting -- 
reboardmg a ejole««ing> ^'some gentleman recognized him 
there, a friend of his, said hello, and -- 

Q This was in Geneva? 

A This was in Geneva. 

Q Other than that, did you ever meet Mr. 

McFarlane? 

A No. 

Q How about M^. Casey? 

A No. 

Q And I think you mentioned meeting one or two 
DEA agents but that is slightly separate from the Iranian 
initiative? Other than the people that you've just 
mentioned, did you meet any other U.S. Government officials 
in connection with the Iranian initative? 

A Not that I can recall. 

Q Was any — to your knowledge — 

A Oh, I am sorry. Yes. There is one other 
gentleman that I met. Charlie, a CIA analyst. 

Q Allen? 

A Allen, Charlie. I met him. 
i Sfc °^' sorry. One other gentleman that I -- 



622 




74 



Mr. Cave introduced me to. Mr. Cave was present, Mr. North 
was present. We met in a restaurant. I think he was a 
CIA official, and I think it was the desk -- from the 
Iranian desk, if I am not mistaken. I cannot recall the 
name now. 

You are talking about the Iranian initiative. 
I just want the record to be correct on one other aspect 
of Iranian involvement. I'm not saying the Iranian 



i 




To your knowledge, was it -- was any money 
derived from the Iranian initiative or the Nicaraguan 
venture ever given to any Government official other than 
what you've testified about — well, I'll finish my 
question there. 

MR. JANIS: Excuse me. Are you including money 
given for operational purposes? 

MR. NIELDS: No. For the personal benefit of 



any Government official 



THE WITNESS: No, S 



icussinn 



623 



UNCLASHD 



75 



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2 

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4 

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8 

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13 

14 

15 

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17 

18 

19 

20 

21 

22 

23 

24 

25 



BY MR. NIELDS: 

Q Was it ever contemplated that money would be 

given to the benefit of any Government official, putting 
aside what you testified to about Mr. North and his wife? 

A No, sir. No, sir. 

Q Okay. When did you get back into the loop, so 
to speak, in connection with the Iranian initiative? 

A I said I was in the loop, the financial end 
of it. 

Q I guess I want to bring you now to the second 
channel . 

A Operationally? 

Q Yes. 

A I think if I'm not mistaken, June, July of 
1986. 

MR. JANIS: Before we get into that, off the 
record for a second. 

(Discussion off the record.) 




WSSIFlfO 



624 



Dinkel/drg 
Take #3 
fols. 



iciASsro 



76 



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2 

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S 

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THE WITNESS: I believe in June or July of '86 I 
started to receive my own echoes back that Ghorbanifar 
channel was not going well. 
BY MR. NIELDS: 

Q You received these echoes back from Secord, North, 
and other people in the government? 

A Exactly. Exactly. And how frustrated they were, 
and if we could find other channels to communicate with the 
Iranians, so I believe it was June-July when I was brought 
back into the loop to check the possibility of a new channel". 

Q And I take it you then — 

A I went to work. 

Q You went to work? 

A I went to work. 

Q Can you just describe generally what you did? 

A I had been keeping close watch of my contacts with 
Iran, not only the contacts of the past, but I, at quite a bit 
of expense, was maintaining through some associates that I 
have in Europe and in Iran, creating new contacts from the new 
group, and I was monitoring that for commercial purposes, sc 
I was never at any time out of touch and contact with Iran. I 
kept myself pretty much appraised of what was going on. 

And when this request was made of me, I called my 
associate whom I have known for a long time and who is quite 
competent for spy work, and we discussed a number of 



\\m m\m 



625 



in* 



m 



•SSIFIED 



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7 

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9 

10 

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13 

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25 



possibilities, and I decided and discussed that also with 
Secord that the way to approach this is to choose one or two 
at the max of the factions in Iran that had the better chance 
and work on them rather than spreading all over the place, 
because this way we would never get anywhere. 

The concept was acceptable to General Secord. I 
suggested the two factions that I had my eyes on. Secord, I 
think, checked that with the agency and came back to me and 
said that is the right way to go in their opinion also. So 
I zeroed in on those two factions and created a situation 
that someone that could qualify for both factions, he had a 
track record in both of these areas, to come and meet with 
us. We had the man sitting inl 

[because we could not -- I could not get the decision from 
the Americans whether they wanted to go with the second 
channel or they didn't want to go with the second channel, 
who was going to participate in interviewing the second 
channel. 

Oliver North wanted to come, then his schedule 
didn't allow. They had problems with the Israelis. All 
kinds of problems that really caused a lot of difficulty and 
embarrassment for me. I cun having this guy sitting in there 
at high expense. I have my f ellow^^^^^^^^Hbabysitting him. 

Q This is a government official you are talking about? 
Or this is the relative? 91 



mmm 



626 



|!iCUSSIflEB 



78 



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2 

3 

4 

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6 

7 

8 

9 

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13 

14 

16 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 




A Yes. It is the relative. ^^ 

Okay? 

So, finally, with all the back and forth, in August 
Richard Secord and I, my friendj 

babysitting this guy, participated in the 
meetings to see if the guy was for real; if he knew anything 
about what was going on; where his head was. And a lot of 
piercing questions were asked from the man and the man ap- 
peared to know what was going on. He was aware. He knew about 
the first channel. Richard and I felt very comfortable about 
what we saw there. 

In addition to that, we saw the guy to be forth- 
coming. We saw his consultants with him be also aware, 
capable of making analysis. For a change, there was a sigh 
of relief. My God, finally there is somebody you can talk to. 
And all that was reported back by Richard. From the testimony, 
I learned that he did that in writing as well. I did not 
know it at the time. ^^^^^^^^^^ 

Q This is the meeting^^^^^^^^^Hyou are describing? 

A The meeting^^^^^^^^^^^Bso they came back to me 
and said "We want to see how serious these guys are and if 
they are serious, and it is also convenient for North, see 
if the guy is prepared to come to Washington. I offered 
that. He said we will check back with Iran, get back to me. 
He said he was doing to recommend to T&hran^J'^^- - to accept 




627 



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this offer, and they did. I arranged for his -- again, we 
were using Arrow Leasing to transport him. Richard gave us 

the routing, how he wanted him to cc 

~'\e guy came 

with the other two, and our meetings started with George Cave 
being present and in the Old Executive Office. I housed 
them^^^^ 

Also was made aware that the room of the -- we had" 
three rooms for them there. I also had a room there. I was 
there with my wife. 





Anyway , 

we made it very clear from the very beginning that I did not 
want to be considered at all as part of the American official 
teaun. It was very clear, and that I'm a businessman, I told 
them, and I'm here to benefit as a result of the re-establish- 
ment of the relationship, and I have no interest to partici- 
pate in the political intelligence discussions, and indeed, 
I did not in the Old Executive Office. I stayed outside the 
room, holding hands with the consultant of the relative up- 
stairs while General Secord and Cave were assisting Oliver 
North, who headed the delegat 






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We joined them for lunch, and then towards the 
evening, Ollie and I took this gentleman for a tour of the 
White House. 

Q Where did you go?, 

A Everywhere. 

Q Including the Oval Office? 

A Including the Oval Office. By then, they had a 
little barrier in front. We did not walk into there. And 
Ollie sometimes gets into one of his moods with his jokes. 
We were passing by — there is a picture in the White House 
of a bunch of dogs, a beautiful painting it is. One of the 
dogs is sleeping. Ollie referred to that as the Cabinet, 
and that is Casey. 

Q That is the Cabinet? 

A And that is Casey. He joked about that. They 
tried to make an impression on the relative. And he's an 
excellent salesman, this Oliver North. I tell you, he's 
quite a guy. Quite a guy. 

Q Did you talk about arms and hostages as well as a 
broader initiative? 

A Well ~ 

Q Or weren't you there? 

A I was not there, but when you have even half an 
Iranian, there is no secret any more. 

MR. VAN CLEVE: Like a Congressional committee? 



ke a Congressional commit 

IIMCUSSIFIED 



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THE WITNESS: I think the Congressional conunittees 
learned from the Iranians. 
BY MR. NIELDS: 

Q So you were aware that arms and hostages were being 
discussed? 

A More than aware. The guy wonld come out and tell 
me "This is secret, don't tell anyone." What do I do? I 
had a unique, unique experience in this whole thing. I 
wore so many different uniforms and put on so many different 
hats. 

Q Wigs? 

A Not wigs. These are hats. It is easier to put on 
wigs, not to get confused with the different roles. It is — 
I am a businessman. I have found a golden opportunity now 
that I can serve my country, because only a couple of years 
before then or less, I had taken an oath in the process of 
becoming naturalized. So I take such things seriously, 
because it is not just a formality to me. 

Here I am to help my place of birth, my native 
country, and, by God, here I cim to make some money. If I 
wanted to put such a package together, no way I could have 
done it. 

And then, in addition to that, I'm in there, 
American team uses me as a consultant, Iranians are using me 
as a consultant,, and here I'm sitting trying to find the best 



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way to keep all of these balls in the air. I was praised a 
number of times for having managed to keep all those balls 
in the air. Mr. Cave a number of times told me that it 
would not have been possible without my help, and he was not 
referring just to creation of the second channel, he was 
referring to continuation of the second channel, because 
there were very, very harsh times that the parties became 
disenchanjfed, frustrated, left, and I stayed behind always. 
Albert stayed behind to repair things. 

The famous nine-point agreement — 
Q You are now talking about a later meeting in 
Frankfurt, I take it? 

A A later meeting in Frankfurt. 

MR. JANIS: Before you get to the nine-point 
agreement, is there anything else you need to tell him about 
the September meetings? You want to skip ahead? 

THE WITNESS: I thought he wants an overview. My 
impression is an overview. 

MR. NIELDS: If there is something of particular 
importance about the September meetings in this country, tell 
it now. 

THE WITNESS: Okay. 

MR. JANIS: That is all right. 

THE WITNESS: I have been so far under the impression 
that you are going to come back, and we have only 15, 20 



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minutes to give you an overview. 

BY MR. NIEXDS: 
That is true. 
A Which way do 1 go now? 

MR. WZCHSLER: Go with the overview. 

THE WITNESS: Okay. So I always stayed behind to 
repair the damages emd bring the team back together. The 
nine-point agreement is my creation. As a matter of fact, 
m Farsi, on the top of the page, it says — in handwriting 
of the official — saying that our resolution, meaning their 
resolution with Hakim; and I came up with a very interesting 
arrangement when we were discussing the number of hostages 
to be released. I came up with one-and-a-half hostages. 

When I communicated that to North, I didn't have 
the KL-43, and Richard was gone, and he was supposed to meet 
me the next day. I urged North not to make any decisions 
until Richard got back, and we could send him a message on 
the KL-43, but I cannot forget his reaction. He wanted to 
know how many hostages we were going to get. I said one-and- 
a-half. 

He said, "Are you drinking?" I said, "No, I am not 
drinking, that is what it is." He was very frustrated. The 
man hadn't slept for a long time, just caught him as he landed. 
I said, "Ollie, wait until we send you a god-damned message." 
Richard came in later and_ ^^4 ^t^ ej^p^^.y^g^^cept behind 




uNtussro 



^ the nine points. We sent the message. Richard kept on 

2 saying, "Albert, the more I read this package of yours, the 



632 



better I like it, and it is even better than the seven points 
that Ollie put together." That was very flattering, coining 
from Richard. Richard very seldom does that. 



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LiflClASSIFIED 

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So the relationship continued. He had arms shipped, 
monies were received, Jacobsen was released. We had subsequent 
meetings in Geneva, disagreements again came about, shouting, 
screaming, Ollie left, Secord left, threatening each other. 

I was left again behind to repair the relationship, 
which I succeeded. And that was about the time that 
everything was revealed. 

Ollie disappeared. Richard disappeared. Cave 
disappeared. And there I am in Geneva with the Iranians 
looking at me, what are we going to do next. 

Cave contacted me and said he had one last 
assignment for him and for me, if I would be willing to help 
with that assignment. I said, what is that? He said if I 
would arrange for a meeting between the Iranians and the State 
Department representative. I said, let's see what I can do. 

I arranged a meeting. A certain gentleman that I 
never met, Charles Dunbar, was sent. This was two, three 
weeks, I believe, after the revelation. This gentleman left 
a very bad impression on the Iranians. I understood he spoke 
Farsi. 

He refused to meet with me when I said that I would 
be prepared to meet with him if he would accept for my lawyer 
to be present. Be didn't like that. He said he didn't want 
to meet with me. 

At that time I was also going through the process of 



UNClASSra 



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answering a million questions that Mr. Janis had for me, and 
the only way he would get the answers was to travel with me 
wherever I went. So he did get to meet these gentlemen there. 
And so I didn't get to talk to Mr. Dunbar. 

The Iranians were very frustrated and then at that 
time I was ordered and shown a telex that my mission is 
terminated and I am no longer to represent the U.S. Government 
in any form or capacity. 

Q Who sent you the telex? 

A Cave showed me a telex that he had received. And I 
have honored that since then. 

Q Have you had any conversations with North since 
mid-November? 

A I don't recall, Mr. Nields, that. Because, since -- 
we may even have had our last meeting with the Iranians — I 
believe it was in November, We had the last Geneva meeting 
where Mr. North was present. I don't know whether it was in 
October or November. I cannot recall that. 

Q Since then have you spoken with Mr. North? 

A Since then I believe that I saw Mr. North once or 
twice. I have been away since then most of the time, trying 
to maintain my contact with the Iranians and maintain my 
credibility, which is a different story in itself. 

There are some dates we will try to see if we can 



come up with to help you out. 



UNClASSm 



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UNCLASSIFIED 



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MR. NIELDS: Let's do that. 

In the meantime, let's mark this as Exhibit 6. 
(The following document was marked as 
AH Exhibit 6 for Identification.) 
COMMITTEE INSERT 



UNCIASSIHED 



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BY MR. NIELDS: 
Q Mr. Hakim, I am putting in front of you a copy of a 
subpoena duces tecum for this deposition, which your attorney 
accepted service of, and I don't care which one of you answers 
the question, but I have to ask the question, whether you have 
any documents Called for by the subpoena to produce at this 

time. 

MR. JANIS: Before I reply to that question, I need 
to understand that with respect to any documents called for 
by any subpoena, production of those documents would be 
covered by the grant of immunity conferred upon Mr. Hakim and 
the rulings previously entered. 

MR. NIELDS: Plainly so. 

MR. JANIS: By the committee chairmi^li on April 20, 
1987; am I correct? 

MR. NIELDS: Without a question. 

MR. JANIS: First, the subpoena which is marked Hakim 
Deposition Exhibit No. 6 is a subpoena from the House of 
Representatives. And, as I have told you before, Mr. Nields, 
off the record, and I think you understand, we have had 
virtually no time to try to comply with this subpoena or, for 
that matter, the Senate subpoena, which I assume you intend to 
mark as Deposition Exhibit 7? 

MR. NIELDS: If somebody gives it to me, I will. 
Otherwise, we will mark it when we resume. 



UNClASSra 



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UNCLASSIFIED 



89 



f MR. JANIS : At any rate, we haven't had a chance to 

2 respond to either subpoena. 

3 To the extent that these subpoenas call for 

4 documents actually in his possession, or reasonably within 

5 his possession, we will produce them. To the extent either 
3 subpoena calls for Mr. Hakim to go on what I would call a 

7 search and retrieve mission all over the country, or demand 

8 to inspect the books and records of every organization of which 

9 he has ever been a party and then sift through them and 

10 determine which records are required, I think that would be 

11 unreasonable, although I do believe the committee itself would 

12 certainly have the right to subpoena those records. 

13 But, at any rate, we haven't had a chance to fully 

14 focus on this because of the deposition schedule we are 

15 working under. We do have a couple of documents that we can 

16 produce now that I think are responsive to the subpoena, if 

17 you want us to do so. 

18 MR. NIELDS: Well, yes. I think we would like you 
^9 to do that. And, in addition, we have during the course of 

20 this deposition identified a number of documents of potential 

21 importance and certain relevance to the committee's work, whict 

22 would fall within the boundaries of the subpoena which has 

23 been marked Exhibit 6 — 

24 MR. JANIS: What I would suggest we do — 
25 



MR. NIELDS; 



-- and I would request — what I am 



UNCUSSIHED 



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going to do at this point in time is adjourn this deposition 
until a date which we will advise you of very promptly, and 
with a view toward giving you an opportunity to obtain those 
very important records and producing them to the committee at 
that time. 

MR. JANIS: I would like ~ 

MR. HOLMES: You are not proposing to adjourn the 
deposition before the Senate has a chance to question? 

MR. NIELDS : What I aia proposing, as I understand, 
these gents are -- basically we have used up the time allotted 
and the time available to them, and I would suggest that we 
reconvene the deposition at your convenience, and that is 
in the next couple of days, so that you get a chance to ask 
the questions that you have. 

MR. HOLMES: Our convenience -- my understanding is 
they have already made some kind of agreement that they will 
not be available for the balance of the afternoon. Our 
convenience would be tomorrow morning at 10:00. 

MR. JANIS: Let's just go off the record. 
(Discussion off the record.) 

MR. NIELDS: I would like these marked collectively 
as Exhibit 7. 

(The following documents were marked 
as AH Exhibit 7 for Identification.) 

COMMITTEE INSERT 



UNCIASSIRED 



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UNCLASSIHED 



91 



1 .. BY MR. NIELDS: 

2 Q Mr. Hakim, I am putting in front of you what has 

3 been marked collectively Deposition Exhibit 7 that your lawyer 

4 just handed to me. 

5 I take it these are docxaments which you are 

8 producing in response to the subpoena which was marked Exhibit 

7 6? 

8 A Yes, sir. 

9 Q And I take it this consists of the documents, the 

10 responsive documents, that you had immediately available to 

11 you at this time, but does not constitute your full and final 

12 response to the subpoena? 

13 A That is also yes. 

14 Q What I propose to do is adjourn — 

IB MR. JANIS: Just so there is no question, I think it 

16 is useful to briefly state on the record what some of these 

17 things are, 

18 MR. NIELDS: Let me just describe them, 

19 MR. JANIS: Let me do it. Maybe we can do it more 

20 quickly. 

21 The first is letter dated October 27, and this deals 

22 with the payment of — on the sale of weapons to the second 

23 channel , 

24 Correct, Mr. Hakim? 

25 THE WITNESS: Correct. 



mf^M 



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2B 



MR. JANIS: The second document is a cooy of 
handwritten notes. These are Oliver North's handwritten notes. 

THE WITNESS: The lower portion. 

MR. JANIS: The lower portion is Oliver North's 
handwritten notes . 

THE WITNESS: The seven points. 

MR. JANIS: The next page, which is in Farsi, is — 
no, the next page, pardon me, the next page is in Farsi. It 
is the nine points Mr. Hakim has testified to. 

The next page is handwritten notes, I believe, from 
General Secord that were also prepared at the time of the 
meeting with the second channel in Germany. 

Is that correct? 

THE WITNESS: That's correct. 

MR. JANIS: And then there are some telexes dealing 
with the military supplies to be provided pursuant to the nine 
points? 

THE WITNESS: That's correct. 

MR. WECHSLER: Four telexes? 

MR. JANIS: Four telexes. 

Then there is a letter from the — dated October 24 
from Deutsch Bank, dealing with the purchase of weapons by 
the Iranian representatives for $3.6 million. 

And a telex -- some telexes regarding the Seune 



matte r. 



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end Dinkel 
tape 3-A 
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MR. NIELDS: Okay. 

We will adjourn this deposition — 

THE WITNESS: Did you have a couple of questions? 

MR. NIELDS: He will pick them ud when we reconvene. 

We will adjourn this deposition until a time which 
we will fix in the next ''ay or two, at the outside, at which 
time we will continue with the hope that you will have been 
able to take personal and physical custody of some additional 
exhibits responsive to the subpoena. 

MR. HOLMES: Let's adjourn it until Wednesday at 
10:00, iinless there is fuf^ther notice, so he is under a 
continuing and unbroken obligation to appear. 

MR. NIELDS: Let's adjourn until Wednesday, this 
coming Wednesday, two days from now, at 10:00 a.m. in this 
same room, unless we in the interin fix another time and place. 

(Whenipon, at 1:40 p.m. the deposition was adjourned, 
to be reconvened at a time to be determined.) 



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% 



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CORX NO. 



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«2i 




DEPOSITION OF ALBERT HAKIM 



Sunday, May 31st, 1987 



U.S. House of Representatives, 

Select Conmittee to Investigate Covert 

Ams Tr2msactions with Iran, 
Washington, O.C. 

The committee pursuant to call at 10:30 a.m., in 
Room H-139, the Capitol, Arthur Liman, Senate Select 
Committee, presiding. 

On behalf of the House Select Committee; John Nields, 
Joseph Seiba. 

On behalf of the Senate Select Committee: Arthur Liman, 
Caneron H. Holmes, Timothy Woodcock, Louis Zanardi, 
David Faulkner, Nicholas Wise, John Monsky. 

On behalf of the Witness: N. Richard Janis, Lawrence H. 
Wechsler, and Clement R. Gagne, III; Janis, Schuelke & 
Wechsler, 1728 Massachusetts Avenue, N.W. , Washington, D.C. 
20036. 




A/^U^BS 



Partially Dectassifiedffleteased on 

under provisions of E 12356 
|%by K Johnson. National Sacunty 0)uncil 

T 



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Whereupon , 

ALBERT HAKIM 
having been previously sworn, was called as a witness herein, 
and was examined and testified as follows: 

MR. LIMAN: This is a continued deposition of 
Mr. Hakim on behalf of both the House and Senate Select 
Committees. You continue under oath and you ».ontinue under 
the direction to testify provided by the immunity orders 
secured by both committees. 

EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 

BY MR. LIMAN: 
Q When your testimony ended last week, you 
indicated that you were going to try to obtain some 
additional records that were located in Switzerland that 
we had requested. Have you succedded in obtaining any such 
documents? 

MR. JANIS: You want me to respond to that? 

MR. LIMAN: Yes. 

MR. JANIS: We have not yet obtained those 
documents, but there are docxanents coming by courier from 
Switzerland. They may well be in the U.S. now. 

They are being delivered to Mr. Nields' office 
and if they are not delivered today, I am confident they 
will be delivered by tomorrow. They were sent Friday. 

MR. LIMAN: Do you have a copy of the two so-called 






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wills? 

MR. JANIS : The answer I gave you was responsive to 
the issue about Switzerland. In addition, during the 
deposition there were a number of questions made for 
documents, whether they were located in Switzerland or else- 
where, and Mr. Hakim was abJo to locate some records 
responsive to the request luade in the deposition when he 
was home for the last few days, and he is prepared to 
produce those documents at the time, my understanding being 
that these documents are also being produced pursuant to 
the immunity orders and the rulings of the chairman issued 
with respect to production of documents at the April 20, 1987 
hearing in this matter. 

MR. LIMAN: That is correct. Please produce them -- 
has anybody got the list of exhibit numbers? 

MR. JANIS: I think the first will be Deposition 
Exhibit 6, if I an not mistaken. 

MR. LIMAN: Let's call it in any event Deposition 
Bxhibit 8. 

MR. JANIS: It may be eaiser if we do these one 
at a time. 

MR. LIMAN: That is the way I suggest we do them. 

MR. JANIS: Deposition Exhibit 8 is the original 
chart that was referred to during Mr. Hakim's testimony 



and which is found in the Tower report. 



WllIlLoUaJtlHiFP^ 



^sifm 



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siro 



MR. LIMAN: Let me stop a moment and can you mark 



1 

2 this as 8. 

3 

4 (The document referred to was marked as Deposition 

5 Exhibit Number AH-8 for identification.) 

6 3Y MP. LIMAN: 

7 Q Mr. Hakim, this is the chart that you testified 

8 was prepared by Mr. Zucker? 

9 A That is correct. 

10 Q Was it prepared in Switzerland? 

11 A Yes, it was. 

12 Q Where did you find it now? 

13 A In my home in California. 

14 Q And was this given by you to General Secord, a 

15 copy of this chart? 

16 A I cannot recall. I may have done that in the 

17 past when this was prepared. I don't remenber that. 

18 Q Let's go on to the next exhibit. 

19 MR. JANIS: The next exhibit is an investment 

20 aanagement agreement with respect to AH subaccount 1 in 

21 which $2 million was depositied with CSF on March 5, 1986. 

22 (The document referred to was marked as Deposition 

23 Exhibit Number AH-9 for identification.) 

24 BY MR. LIMAN: Mr. Hakim, this is an agreement 

25 that says then RBS/AH — is RBS Mr. Secord? 






fCFCrv 



645 




SIFIED 



1 -A Yes, it is, and I must point out that this 

2 Exhibit 9 may not be the — as far as the first page is 

3 concerned, may not be the final document. In other words, 

4 once the documents that my attorney, Mr. Janis, referred 

5 to are received from Geneva, it may have a fifth party to 

6 the contract. It may have only AH, because it was an 

7 error. I recall, once they did that, I told them that that is 

8 not the way it should be, so you may find this to be 

9 different than the documents that you received. 

10 Q Is the AH referred to on the first line — . 

11 A Albert Hakim. 

12 Q You? 

13 A Yes. 

14 Q You have testified before that some documents were 

15 signed after the November disclosures, but as I recall 

16 your testimony, you said that the agreements covering the 

17 two $2 million deposits were signed earlier, contemporaneously 

18 is that correct? 

19 A If this is what I testified, then it is correct. 

20 Q Do you recall this indicates a date of May 15, 

21 1986 covering a deposit made on March 5, 1986, 

22 A Yes. 

23 Q Do you recall whether this was signed on or about 

24 May 15, 1986? 

25 ' 



Yes. 





^SIFIED 



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Q This was not one of the back-dated documents that 
was signed after November? 

A No. 

MR. JANIS: Excuse me, I want to object to the 
term "back-dated document." I am not sure that is consistent 
with the testimony. He just said he signed some things late, 
but I am not sure that the testimony would support the notion- 

MR. LIMAN: When the documents arrive, we will see 
whether they were back-dated or not. 

THE WITNESS: The documents that I said I signed 
in November were the documents for the formation of the 
various companies that Mr. Zucker did not have someone 
that he could report to his authorities back in Switzerland. 

Those are the documents. These are not related 
to that. 

BY MR. LIMAN: 

Q And it says signature of the client. Can you 
read whose signatures appear there? 

A That is ray signature: 

Q That is yours? 

A Yes, sir. This H-A-K-I-M — 

Q What are the other two letters there? 

A That is also Hakim in Farsi, a combination of 
English and Farsi. 

Q So it was signed by^^Qi^iitaSA^lish and then in 




647 



•wmm 



IFIEO 

1 Fatsi? 

2 A That is my signature. That is my formal official 

3 signature in all the transactions. That is the way it has 

4 been since '56. 

5 Q And General Secord did not sign this? 

6 A That is also correct. 

7 Q And where it says on page 5 "account name," 

8 it has AH, and then what is the other initials on that? 

9 A That is the initial of the lady who is responsible 

10 for the CSF investment in Bermuda — I can't recall her 

11 last name — her first name is Evlyn. One of the reasons 

12 that this is initialed here is because the first page should 

13 have been corrected. 

14 As you see, this is not consistent with the first 

15 page . 

1g Q The account name was AH subaccount? 

17 A Subaccount 1. 

18 Q And you provided under account information that 

19 the statement on correspondence should be held as opposed 

20 to being mailed to you, correct? 

21 A That is correct. 

22 Q And that the account should be kept? English, 

23 correct? 

24 A That is correct. 

25 Q That was also provided. Did you find this 
document in California, as well? I*4fjftl*r AO^If il* ll 



648 



TOP 

UNCLA 




_ 8 

1 - A That is correct. 

2 Q Do you remember when you signed the document that 

3 corrected the first page? 

4 A I really don't recall that, because the lady who 

5 works for CSF Investment does not live in Geneva, and 

6 I don't know — it must have been corrc-ted during one of 

7 her trips to Switzerland. 

8 Q It says that it is covering a deposit on March 5, 

9 1986, but the agreement was signed on May 15, 1986? 

10 A That is consistent wijth my testimony that we had 

11 set aside and then when we got the opportunity to get 

12 organized and try to put things in order, and when the lady in 

13 charge of CSF Investments was in Geneva we could do that. 

14 We went back and organized our agreements. 

15 Q Let's go to the next document. 

16 MR- JANIS: The next document is an investment 

17 management agreement between AH s\ibaccount Number 2 and 

18 CSF dealing with additional $2 million that was depositied 

19 on June 18, 1986 and that is the same date of this 

20 a9reeroent. 

21 MR. LIMAN: Please mark this Exhibit 10. 

22 (The document referred to was marked Deposition 

23 Exhibit Number AH-10 for identification.) 

24 BY MR. LIMAN: 

25 Q For the record, Mr. Hakim, this is your signature 



WEi 



s^i%:dii 



IS^mjy^ 



649 



^m^- 



on -Page 5? 

A That is correct. 

Q And this covered the second deposit of $2 million? 

A Yes, sir. 

Q That was signed on or about June 16, 1986? 

A Yes. 

Q And you found it in California? 

A That is correct. 

Q Where did you find these documents in California? 

A In my office. I have. an office at home. I 
found that there. 

MR. JANIS: The next document is an investment 
management agreement between AH subaccount 3 and CSF 
Investments. It is dated June 16, 1986 with respect to 
a $200,000 deposit made on June 18, 1986. 

MR. LIMAN: Please mark this Exhibit AH-11. 
(The document referred to was marked as Deposition 
Exhibit Number AH-11 for identification.) 
BY MR. LIMAN: 

Q Mr. Hakim, if I turn to page 5, your signature 
appears on this? 

A Yes. 

Q And it was signed by you on or about June 16, 1986? 

A Yes. 

Q And it was also found by you in California? 



UmASSIJEiEdr 



'Us<;fn 



^TN 



650 



SScLniSI^'^/fo 



10 



1 -.A Yes, sir. 

2 Q Now, is this the — can you tell me what this 

3 $200,000 was going to be used for? 

4 A I have not been able to sort that out in my 

5 mind. I tried to do that prior to coming here. It could 

6 ha"s well been the so-called Button investmentpr, or it 

7 could be the contra death benefit investment. 

8 (Counsel confers with witness.) 

9 THE WITNESS: There is also a third possibility. 

10 If I recall correctly, there must be somewhere in my 

11 deposition during the past few days that I believe referred 

12 to setting aside some money for investment. It could be 

13 also the balance of that money. So I am not quite sure. 

14 BY MR. LIMAN: 

15 Q You referred to setting aside, I believe, $500,000 
15 for investroent. 

17 A It could be the balance of that. 

13 Q As you look at this now, as I understand it, you 

19 don't know whether this was the Button account, the contra 

20 death benefit account or part of the money for investment 

21 to be made on behalf of you and General Secord? 

22 A That is correct, sir. 

23 Q Do you have any documents that would indicate 

24 what it was for? 

9c A If and when we should be able to get the total 



«HCLA^S?hpt?HCMss,nm 



651 



21 
22 
23 




1 picture — by -th«L**I"niean to be able to also see how the 

2 people that I employed to maintain the books, once we 

3 get into their system, we should be able to find out 

4 what it is. 

5 Q What kind of record would you expect that would 

6 help identify whether this was a Button account or other 

7 accounts? 

8 A Basically, what I like to do is to audit their 

9 accounting and see what happened to all these three 

10 elements. 

11 Q Was the account that was set aside for contra 

12 death benefits ever drawn down upon? 

13 A I don't really know how CSF managed this. 

14 Q Would death benefits pay out of that account? 

15 A No. 

1g Q Was the account for which $500,000 was set aside 

17 for investments ever drawn down upon? 
■la A They were supposed to. If they indeed did that or 

19 not — see, we have made, as I have testified, made 

20 investments in other areas. 
Q Was this account supposed to be used, for example, 

for the TriAmerican investment? 

A Exactly. So how it was done within CSF I cannot 

24 testify to. 
25 



Q What about the Button account — was that ever 



l^iASSIFIED 



652 



!^^.y«. 



12 



1 drawn down upon? 

2 A No. 

3 Q And so far as you know is the Button account 

4 still in^tact? 

5 A If they ever created it, it should have 

6 remained in'^tact, and I also testified that I am not aware 

7 of the discussions that Mr. Zucker had with Mrs. North. 

8 Q Does that mean that you do not know whether 

9 Mr. Zucker succeeded in passing any money to Mrs. North? 

10 A It is possible, but it is not probable because 

11 I should have informed if it would have taken place. 

12 Q And Mr. Zucker never told you that he succeeded 

13 in passing any money to Mrs. North? 

14 A That is correct. 

15 Q This account is denominated AH Subaccount 3, 

16 right? 

17 A Yes . 
IS Q Did you ever see any documents indicating that 

19 the Button account was denominated subcommittee 3. 

20 A No , I haven ' t . 

21 Q What about the contra death benefit account? 

22 A I have not seen such a document either. 

23 Q Or the investment account? 

24 A I might — there might be such a document. I 

25 don't remember. That was more specific. I don't remember that 



UMCLftJS&^^mte 



A Cc/nrrv" 



653 




VJHCU5^^^^^%5> 



13 



1 * Q Let's go on. 

2 MR. JANIS: The next document is responsive to 

3 the conmittee's request to Mr. Hakim regarding what were 

4 loosely called wills or testimentary documents. There 

5 are two such documents. The first is addressed to the 

6 holders of AH subcommittee 1 and 2 signed by Mr. Hzkim. 

7 I am going to give you that now, Mr. Liman. 

8 MR. LIMAN: This document should be marked as 

9 AH-12. 

10 (The document referred to was marked for 

11 identification as Deposition Exhibit Number AH-12.) 

12 BY MR, LIMAN: 

13 Q Does A.H. 12 represent one of the testamentary 

14 designations or wills as we have used that term that 

15 you have testified to? 

16 A Yes, sir. 

17 Q And does it bear your signature? 

18 A Yes, it does. 

19 Q Unlike the other exhibits relating to the 

20 accounts, this doesn't have a date. Do you observe that? 

21 A That is correct. 

22 Q Do you recall when you signed this document? 

23 A The answer is, no, but it was definitely prior 

24 to November. 

25 Q Whom did you instruct to prepare this document? 



HMGU^F)|% 



^ffCL^ 



^<:crr:~^ 



654 



\}Hc;' 




WD 



14 



1 - A My attorney, Mr. Zucker. 

2 Q And where did you sign it? 

3 A In his offices in Switzerland. 

4 Q Who was present when you signed it? 

5 A To the best of my recollection it was just 

6 Mr. Zucker and myself. 

7 Q Was the person who signed this Evlyn Repiqut — 

8 R-E-P-I-Q-U-T? Does that name ring a bell with you? 

9 A Yes. She and I separately signed that. When the 

10 document was prepared by Mr. Zucker I separately signed 

11 it with her in her office, which is different than Mr. 

12 Zucker' s. > 

13 Q Did you read the docxanent before you signed it? 

14 A Yes. 

15 MR. LIMAN: May I have the next exhibit, please? 

16 MR. JANIS: The next exhibit is a similar 

17 document with respect to AH subaccount 2. 

iS MR. LIMAN: Would you mark this one as AH 13? 

19 (The dociiment referred to was marked as Deposition 

20 Bzhibit Number AH- 13.) 

21 BY MR. LIMAN: Am I correct that this bears your 

22 signature? 

23 A Yes, sir. 

24 Q Did you sign AH-13, which covers subaccount 2, 

25 at the seime time that you ^ijPf^ the document covering 



UHCll^'c:prttNi¥ss/F;ED 



655 



UNCLASSlfPRtf®««^/^; 



15 



1 subaccount 1? 

2 A I am reasonably sure, yes. 

3 Q And do you recall when you signed this document? 

4 A The same answer. I can't recall, but it was 

5 before November. 

6 Q Do you remember any event or conversation that 

7 occasioned you to sign — that occasioned you to 

8 instruct Mr. Zucker to prepare these documents? 
g A I remember my motivation. 

•^0 Q But was there some event or conversation? 

I^j A No. I can't remember that. But I do recall since 

12 I beccune as an individual, the beneificary of those monies, 

•j3 I requested such a paper to be drawn. 

•j^ Q Well, let me see if I can have you eleiborate on 

•J5 that. When you said you became as an individual the 

1g beneficiary of them, you became the beneficiary when they 

17 were put into accounts AH-1 and AH- 2, am I correct? 

Ig A And 3, that is correct. 

Q As a result, those monies were no longer in the 
2Q corporation as such, am I correct? 

A That is correct. 

Q And you therefore wanted to provide by these 
documents that if something happened to you, the money would 
not go to your heirs, but would be disposed of as provided 
in these instructions? 







656 



mmim^' 



»/f/£D 



16 



1 _ A That is correct. 

2 Q And you have testified to your motivation earlier, 

3 and I will explore that some more later. 

4 MR. LIMAN: Let's go to the next document. 

5 MR. JANIS: Can we go off the record for a second? 
« MR. LIMAN: Yes. 

7 (Discussion held off the record.) 

3 MR. LIMAN: Let's go back on the record. 

9 While we were off the record, I was informed 

•JO by Mr. Janis that the next document that he was producing 

11 has marking on it of top secret; that it contains sensitive 

12 information that could affect the lives of individuals, 

13 I assume, and I have stated that under the procedures 

14 and rules of the committees, we handle top secret, code 

15 word, documents all the time. 

1g We maintain them on a closely held basis, and we 

17 have certain procedures with respect to the use of the 

1g public proceedings to ensure that we do not jeopardize 

ig national security or risk lives of other people. What I 

20 would suggest is that you mark the document. We will put 

21 it aside in a separate envelope, and I would like to have 

22 Mr. Hakim at least describe on the record in terms that will 

23 not jeopardize individuals what the document is. 

24 Since it is in Farsi, I believe that onlyj ^MHfH 
2c ^MHB pnd of course Mr. Hakim will be able to do anything 




657 



liHfiayiF' 



17 



1 with it anyway. 

2 Mark it as the next exhibit. 

3 (The documents were marked as Deposition Exhibit 

4 Number AH-14 for identification.) 

5 BY MR. LIMAN: 

6 Q Would you describe in general terms what this 

7 document is? 

8 A This is basically a report from the so-called 

10 Q Who gave you the document? Was it a CIA official? 

11 A I believe — well, no, it came from — my under- 

12 standing was and is that from CIA people it was given to 

13 Mr. Secord and Mr. Secord gave it to me to get my assessment 

14 of this report. 

15 Q As is the term "top secret" written on it in Farsi. 

16 A Yes. 

17 Q The document is in Farsi? 

13 A The document is in Farsi written on stationery 

U 

19 of a hotel; Concord, Lafayette, Paris. 

20 Q Do you know what the date is of this document? 

21 A I know the Iranian date on this. 

22 Q What would the translation be for our purpose, 

23 roughly? 

24 A Roughly it would be July-August. 

- 0-- UNCLASSIFIED 

A It is a year ago — it is 1365 Iranian year, and 



658 



22 
23 
24 
25 



uhclaWSiIP^. 



I believe now it is 766. 

2 Q So it would be 1986. 

3 A Yes. 

4 MR. JANIS: The next document is also in Farsi. 

5 MR. LIMAN: Is this document in the same 

6 category; 

7 THE WITNESS: Yes, it is, sir, a different date. 

8 MR. LIMAN: Mark as AH 15. 
g (The document referred to was marked as Deposition 

•^0 Exhibit Number AH-15 for identification.) 

.|.| BY MR. LIMAN; 

.J2 Q AH-15, I am going to write top secret code word on. 

•J3 Who gave you this document? 

■^^ A The same man, sir. 

.|5 Q What is the date? 

.fg A This is prior to the — it is dated a few weeks prio 

^j to that, that is in July. Let me see — because my birthday 

^o is in July. See if I can't figure this out. I should be 

.|g around the 17th of July, approximately 

2Q Q Now, was this document from the same person 

2* to the same person? 



A Exactly. 
Q Thank you. 

Have you read these documents recently? 
A No, not recently. I glanced at them this morning. 



659 




•J5/% 



19 

1 ' Q Did either of these documents complain about 

2 pricing? 

3 A Not this document, no. These — at least the first 

4 one that I read didn't complain. It was basically a review 

5 of the events, the first one, and this one -- 

6 MR. JANIS: That is the first or'^. 

7 THE WITNESS: The second one -- 

8 MR. JANIS: Do you want him to take the time to 

9 reread these? 

10 MR. LIMAN: No, not at this time. 

11 THE WITNESS: Glancing at it, Mr. Liman, it 

12 doesn't — it is an analysis, a political analysis, if you 

13 will, and doesn't talk about the complaints about the 
•)4 pricings. 

15 MR. LIMAN: Let's go on. 

16 BY MR. LIMAN: 

17 Q AH-16 has just been produced to me and it appears 
1g to be a transcript of a conversation dated March 18, 1986, 

19 and I think this will have the saune classification, but let 

20 Jne ask you who gave you this? 

21 A I prepared it and I kept it, I kept a copy. This 

22 is a transcript from one of the recordings I referred to 

23 earlier in my testimony when I was talking to Mr. ^ over 

24 ^^® phone, and we recorded the conversations and gave the 

25 tapes to be given to the CIA. 



660 



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2 

3 

4 

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7 

8 

9 

10 

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12 

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14 

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16 

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25 




"ftf 



20 



This particular one I was asked by Mr. Secord to 
translate it because apparently it was important. There was 
some time pressure and they needed to know what the 
conversation was all about, so I sat in the office, our 
offices in Vienna and translated it. 

(The document referred to was marked as Deposition 
Exhibit Number AH-16 for identification.) 

BY MR. LIMAN: 

And you gave a copy of this to General Secord? 

Plus the tape. 

Did he tell you to whom he gave the tape and the 



Q 
A 
Q 

copy. 
A 

the CIA 



He gave me the impression that it would be given to 






661 



«2 
magi 

(11:15 am) 

1 
2 

3 

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IS 

16 

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UNcSSftffi^T, 



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%ia) 



BY MR. LIMAN: 



Q You have already testified what Falkands 
referred to. 

A Pardon? 

Q You said in prior testimony they refer to — do they 
refer to Phoenixes or Hawks? 

A No, Phoenixes. 

Q And the number "240" represents — refers to what? 

A Spare parts. 

Q The Hawk spare parts? 

A Yes, 240 items. 

Q Is this another one of the documents that you found 
in California? 

A Yes, sir. 

Q What does "Jiyan, cheaper car" stand for? 
MR. JANIS: Which page is that, Mr. Liman? 
MR. LIMAN: Page 5. 

THE WITNESS: That is an Iranian-made car. It is 
pronounced "Jee-yan," the French "J." 
BY MR. LIMAN: 

Q And what kind of armament does that stand for? 

A May I look at it? 

Q Sure. 

A Probably, since we didn't have any pre-assigned code 
words, we created those as we discussed. It probably refers 



662 



liNciMiSg^, 



22 



to the TOWS, if I am not mistaken. 



'•%» 



1 

2 What he is saying, basically, is he has agreed to 

3 accept something less sophisticated than the Phoenixes. 

4 Q Does AIDIE stand for hostages? 

5 A Yes. 

6 I also testified that I referred to the Iranian 

7 new year's present. 

8 Q Is that an Iranian word? 

9 A Yes. 

10 Q What is the translation' — botches? 

11 A It is new year's gift. If you go back to my depo- 

12 sition, somewhere in there I — when I was trying to recall 

13 one of the dates I referred that I talked about AD, which 

14 is the gift. 

15 Q What is the souvenir? 

16 A Probably it is referring to — this is again one of 

17 those creative pieces of work by Mr.^JP Probably it is 

18 something that he wanted us to bring or send to him. If you 

19 look at the whole transcript, I probably would be able to 

20 figure it out. 

21 But it refers — as you can see, judge from this, 

22 it is really a bargaining exercise. He wants something that 

23 he can not get, and we want something that we can not get. 

24 Q The souvenir installment was something that — 

25 A Something that would show that we are serious. 



UNGUSSIE^etH^, 



^m 



663 



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2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

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14 

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16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



Q And you refer here to how you have been able to deal 
with the bureaucracy and how Congress is on everybody's 
back. 

Was that bargaining talk? 
A Oh, definitely. 

Q That is what it sounds like. I just wanted to get 
it on the record. 

A Definitely, yes. 

Mr. Liman just touched upon something that brings a 
lot of things back in my mind which I believe you would find 
it important. 

In both — during the discussions with both channels, 
one of our so-called bargaining chips with them was that if 
you guys want to get someplace with us, you have to 
recognize our position -- us, the Americans — that we are 
going out of our way around the Congress, and if you squeeze 
us any further we won't be able to help you in the manner 
that we have started to help you. 

That was used continuously as a bargaining chip. 
MR. LIMAN: Any more documents? 
MR. JANIS: Yes. 

MR. LIMAN: AH-17 is a document that consists of a 
card of a ship broker, Mr. Nielson, a slip of paper with 
Mr. Herup — 



MR. JANIS: H-E-R-U-P. 






:"::'r3 



664 



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7 

8 

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10 

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18 

19 

20 

21 

22 

23 

24 

25 



UNCLASSIFltBr% 

MR. LIMAN: H-E-R-U-P, yes, on it -- and six sheets 
that appear to relate to the Erria, including a power of 
attorney to Mr. Hakim for Mr. Farina and the standard 
Panamanian form of resolution for the power. 

(The document marked Exhibit No. AH-17 follows:) 
****** ****COMMITTEE INSERT********** 
BY MR. LIMAN: 
Q What do these documents represent? 
A These are the documents that I kept from the 
trip that I took to purchase the ship. 
Q The Erria? 
A The Erria. 
Q Okay. 

Let's go to the next document. 

MR. JANIS: We didn't make enough copies of these 
next documents. 

MR. LIMAN: We can always make them. 
MR. JANIS: The next document is number 18. This 
i» Mr. Hakim's state and federal income tax returns for the 
years 1983, 1984, and 1985. We have not had an 
opportunity — we don't have the one for 1982 yet which 
might be responsive to the subpoena. 

MR. LIMAN: Would you mark this? 
(The document marked Exhibit No. AH-18 follows:) 
******* ***COMMITTEE INSERT********** 



24 






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22 

23 

24 

25 



TOP SECMT 

UNCLASSIFIED ^^%, 

MR. LIMAN: Next document, please. ^5^ 
MR. JANIS: The next document — again, we didn't 
make sufficient copies — is a copy of Mr. Hakim's 
telephone -- personal telephone book. 

MR. LIMAN: Would you give this the next exhibit 
number? 

(The document marked Exhi.bit No. AH-19 follows:) 
********* *COMMITTEE INSERT* * ******** 
BY MR. LIMAN: 
Q Exhibit 19, where did you keep Exhibit 19? 
A I normally carried it in my briefcase. 
Q And it was a bpok where you kept adding names to 
it, correct? 

A Yes, it is a normal telephone book, pages in a 
binder. 

Q Did you — how current is this book? 
A This is one of my tools. 
Q Is this one you are still using? 
A Yes. Yes, sir. I may have some old telephone 
books. 

Q Is this complete? Did you remove any pages from it? 
A I gave this to — 

MR. JANIS: It was copied intact from Mr. Hakim's 



book. 



BY MR. LIMAN: 



UNCW^SI|ilE)i^eSi^'''"'° 



666 



TOP SElJJRE'Il 

UNCLASSIFIED *'^^ 

1 Q Just taking a quick look at it, I don't see 

2 North's phone number. I will look at it good, but — 

3 A This should be in — I don't know what — 

^ Q You have a lot of lawyers' numbers, but — you 

5 have half the Bar, it seems. 

6 A It is not necessarily — the telephone numbers are 

7 not necessarily registered under the neune of the person 

8 himself. Normally, the person that I know could very well 

9 be — may I take a look at it? 

10 Q Yes. Just show me, 

11 A It could be under Secord's name, because I didn't 

12 know North. It is here, sir. 

13 Q Under — 

14 A Here. 

15 Q I see it. 

16 A For instance, to give you in a way of exaunple what 

17 I earlier testified, you see George Cave's number in here. 

18 It is under North's because I met him through North, so this 

19 i« Ollie North's. That is his number, and I believe the 

20 naue of one of the — 

21 Q What is this under? What letter is this under? 

22 A "N". 

23 Q I see. 

24 It says "North C.K.," right? Read it to me. 

25 A It says — no, no. This is a different entry. That 



667 



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23 
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25 



onciaMeT^ 



27 



M 



% 



y^ 



is Nole. 

Q Where is North? 
A North is here, Ollie North. 
Q Ollie North. 

A 202-395 — this is the number they had and changed it 
and kept changing it. 

Q That was the office nximber. 
A Yes. 

Q Then you had his secretary's number. Fawn? 
A No, that is not — it is just a reminder who the 
Secretary is. 
Q Right. 

This is the switchboard, the general swi^iboard. 
Did you have his home number? 

1 think so. Here, it says "home," doesn't it? 
Looks to me like it says "home." 
Yes, I believe so. 
And — 

Or, no, it says "home direct," yes. 
Home direct. 

Now I recall. This^^^^^|was the number that 
earlier I used to just to get to his home. 

Q That is the White House switchboard. 
A Switchboard. Then I recall having had difficulties 
locating him, and then I got the direct — that is why it 

UNCLASSlUESlutJciAssiFiED 



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UNCLTKfflfiKg5|T 

says "home direct." 

Q And is that the number that you gave to Mr. Zucker 
in order for him to call Mr. North? 

A I don't recall — I don't recall really what. 
Logically, it must be. 

Q You gave Zucker a number. 

A Yes. So, I don't know whether this was the one. 
Just again, for a second, I mentioned during the time I was 
being questioned about the CIA officials that I met and I said 
there was a gentleman that I met that I didn't recall his 
name that was at the luncheon with Mr.^i^feand Mr. North. 
His name is here — 

Q And the DEA reference, is that to the person who 
was to meet you| 

A Yes,] 

Q Are those all the documents that you have today? 
MR. JANIS: Yes. 
BY MR. LIMAN: 

Q Let's go back to these two reserves which are 
covered by the agreements, AH-9 and AH-10, the two reserves 
of $2 million each. 

A Yes. 

Q Now, I know you have testified on it, but I want 
it as clear on the record as your recollection will permit. 

The first reserve which was put in A.H. subaccount #1 




669 



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12 

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25 



^•% 



% 



was established March 5, 1986. 
A Let me see. 
Yes. 

Now, the second one was established on June 18, 1986. 
Yes, sir. 

Now, these reserves were established before you 
opened up the second channel. 

A Yes. The second channel started — became active 
in July. 

Q In your own words, at the time that you created 

o 
the first reserve which is AH-1, what was its purpose? 

A To have a total financial back-up for any 
emergency reserve, basically to have financial backbone. 

Q And what was the purpose of creating this second 
reserve in June, same purpose? 

A Same purpose. 

Q So that at that point you had $4 million as what 
you call "financial backbone"? 

A Yes. 

Q Now, in your own words again, explain why in the 
case of subaccount 1 you gave North power in the event of the 
death of Secord and yourself while in subaccount 2 you 
limited it to Secord in the event of your death? 

A First of- all, I continued to treat these monies 
as the enterprise's money. That is why I created the will, 

UNCWSSlKJtauwwciAssiFin. 



670 



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 






30 



the so-called will. And I believe his suba 






nt 2, which 



is at the later date — 

Q Yes, that is June. 

A We started to talk to the people for the second 
channel, June, July. 

Q Well, you are not able to say when you gave these 
powers other than that they were after the accounts were 
established and before November? 

A The point that I am trying to make — 

Q What I am trying to focus on is the time you gave 
the powers, which I gather is different from the time you 
opened the accounts. 

A Exactly. 

Q At the time you gave the powers, had you already 
begun your discussions with the second channel? 

A Yes. 

Q And then when you gave the power for subaccount 2, 
was it your intent that Secord would be able to use that 
money to take care of your obligations to subaccount 2? 

A That is correct. 

Q And you have testified before that you did not 
consider it to be seemly for a government official like 
North to take — to have to fulfill those obligations, correct 

A Correct. 

Now, did you tell the people who you had these 



«NCLftSSIf;i;^. 



lUMC^WMCM 



671 



31 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

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25 



obligations to in connection with subaccount '^Qt\at in the 
event something happened to you, Secord would look after 
them? 

A One particular person, I did tell him that, yes. 

Q And did he ask you, you know, "What will happen if 
something happens to you, Albert?" 

A No, I volunteere'^. 

Q So it was not a case of your creating these powers 
because someone in channel two said, "We trust you, 
Mr. Hakim, but if something happens to you, where are we?" 

A No, no, no. The whole idea of the creation or 
requesting the so-called wills we drafted was initiated by 
me as a — I felt obligated towards the enterprise, towards 
the mission, towards the people that were involved. 
I personally created those. 

Q As I understand your earlier testimony, it was your 
hope and goal that if the second channel was successful in 
relations between Iran and the United States were normalized, 
you would be able to, quote, "make a bundle," in doing 
business in Iran? 

A That is correct. 

Q And that Mr. Secord would be your partner in that 
venture? 

A Yes, sir. 

Q And were the Iranians whom you were dealing with in 



672 




32 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

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15 

16 

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^SStFiSQ 



opening up this second channel to be partners in that 
venture, too? 

A Yes, sir. 

Q So that — let me see if 1 understand — you know 
what the term "bakhshish" means? 

A Yes, I do. 

Q Is it fair to say that that is a way of life in that 
part of the world? 

A That is correct, sir. 

MR. JANIS: Would you tell us, for those of us who 
don't speak Farsi, what that is, because you have an 
obvious advantage here. 

MR. LIMAN: I think it is an Arabic word, but 
I don't know that it is. Maybe it is an English word. 

THE WITNESS: No, it is Arabic, which is 
frequently used in Farsi, and it really has a very positive 
ring. 

Bakhshish is a donation for religious reasons. 
BY MR. LIMAN: 

Q Doesn't it go beyond that? When they set the 
compensation of officials in that part of the world, is there 
not some expectation that there is going to be some bakhshish, 
too? 

A That is what the foreigners — foreign to Iranians — 
use within the Iranian community, though they have different 



UNCL(i5^P, 



nUtiSL 



ACCirii-^- 



673 



magi 3 



2 

3 
4 
5 
6 
7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



UNCLASSffffit SEC2MT 



33 



verbiage which refers to their right. 



^so 



Q It is an entitlement. 

A An entitlement, yes. 

Q Entitlement to bakhshish. 

A Right. , 

Q And if you want even the most minictorial thing 

done -- 

A There is an entitlement. 

Q There is an entitlement and there is bakhshish. 
A Right. 

Q Was the $2 millioi) for subaccount 2 the one where 
Secord had the power to be used for bakhshish or to be 
used as part of the cap for this business enterprise that 
would be functioning in the market in Iran? 

A Both possibilities and combination of both 
possibilities were considered. We never finalized how we 
were going to handle it. We were hopeful that once we got 
to a point that you could really sit down and do business 
with the Iranians, sort all these things out. 

Q When you say, "We considered both," who is the "we' 
at this point? 

A Mr. Secord, myself, and the Iranians. 
Q And you never finalized your arrangement, as 
I understand it, with the Iranians involved in the second 



channel? 



«NCLASSIFJW 



inm 



674 



mag 14 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

IS 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



IJNCL^ftfiB^ 



T 



34 



A We could not do that, because we didHTot know 
whether we were going to be successful. If we are not 
going to be successful, it would have taken the form of 
bakhshish. If we would have been successful, it probably 
would have been invested for their benefit in the joint 
venture. 

We did not really clarify it. 

MR. LIMAN: Off the record. 

(Discussion off the record.) 

MR. LIMAN: Back on the record. 

THE WITNESS: In the testimony that I just gave 
in connection with subaccount — 

BY MR. LIMAN: 
Q Two. 

A — two, I want the record to reflect that at no 
time we lost the sight of the prime purpose of these set of 
accounts which were for the purpose of financial back-up. 

In other words, I do not want the deposition to give 
the impression that it was intended to give $2 million in 
the form of bakhshish to the Iranians. 

Q I understand that, that you would use the $2 million 
if the venture was — if the venture was successful in 
opening up the second channel, the $2 million would have been 



used 



And if we didn't have to use it for other 



(miissff(id,6s 



Sifjm 



675 



1 

2 
3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

16 

19 

20 

21 

22 

23 

24 

25 



UNcHSffi?^ 



35 



^S/j^j 



emergencies and whatever would be left — 



% 



Q Would be used in order to do business in Iran? 

A Yes, to initiate the Iranian business venture. 

Q And if you failed in opening up the door to Iran, 
then you had some obligations in the nature of bakhshish 
that would have to be paid? 

A Yes, sir. 

Q And do I understand your earlier testimony to be 
that the total amount of those obligations has never been 
fixed? 

A That is correct, sir. 

Q Are you still getting pressed by any of the people? 

A Impressed which way? 

Q Pressed. 

A Oh, pressed. Sorry. It is more than pressed. 

Q Threatened? 

A That is closer. 

Q Now, when you started doing the business of the 
enterprise, as you have defined it, in 1985, roughly, with 
the arms sales to Calero, the enterprise essentially had 
no capital; is that correct? 

A That is correct. 

Q And so from the sales to Calero, from the Iranian 
arms sales, you generated the money that you needed for this 
enterprise to function? 

__liN£LAS«JflfidWffi^'F'ro 



676 



magi 6 



1 
2 

3 

4 

5 

6 

7 

6 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

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24 

25 




uNcr/issi 



I 




36 



A When you say "sales to Calero," you **^ referring to 



, you S9W ref errir 



the donations, I assume? 

Q Well, you did get commissions on the sales to 
Calero. 

A Yes. 

Q And those monies were left in the enterprise for a 
period of time, weren't they? 

A Okay, yes. I am with you now. 

Q Then the Iranian sales took place, and you generated 
money from them, correct? 

A Yes, I am with you. 

Q And you set aside the reserves. 

A Yes, that is correct. 

Q And would I be correct as a commercial lawyer, 
really, looking at these reserves as something that were, in 
effect, a substitute for capital? 

A Definitely. 

Q I would be correct? 

A Definitely. 

Q Now, the $2 million that was in AH — in subaccount 1, 
which is the account as to which North would have some power 
of disposition if both you and Secord died, was that to be 
used solely for capital of the enterprise as opposed to taking 
care of these Iranians? 



That was the intent, sir. 



liHUUSatXifl^ 



•t.i 1-^ 



677 



1 

2 

3 

4 

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7 

8 

9 

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25 



Q Now, on AH-10 — I think I know the^an 
one — they refer to subaccount 2 as th€; client. 



37 



swer to this 



A Yes, sir. 
Q Okay. 

And this — 
A This is standard form. 

Q You understood that as long as you lived you had the 
power of the disposition of this account? 
A Right. 

MR. JANIS: I might also note on page 5 of that same 
document there is a line that says "signature of client." 
Mr. Hakim has testified that is his signature. 
MR. LIMAN: Right. 

Let's take a two or five-minute break. 
(Recess. ) 

MR. LIMAN: We are back on the record. 
BY MR. LIMAN: 
Q Mr. Hakim, you had a long relationship of trust 
with Mr. Zucker, correct? 
A Yes, sir. 

Q Explain to us why you named Oliver North as the 
successor to you and Mr. Secord rather than Zucker. 

A In other words, you are asking me why I did not leave 
instructions for Mr. Zucker to handle these monies? 

Q Yes, why, if something happened to you and also 



678 



mag 18 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

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23 

24 

25 



happened to Secord, why did you choose North '44/the person 



38 



who would be able to dispose of all this money as opposed to 
Zucker, who was your financial trustee, anyway? 

A This is very obvious. I said that although the 
money was set aside under my name, I continued to treat 
that as the enterprise's money, and I didn't think that 
Mr. Zucker knew what the mission was and what the activities 
of the enterprise consisted of for him to know what to do with 
it. 

Q And so, if both you and Secord were gone, then you 
saw North as the logical person? 

A Right. 

Q And why was it that in this power you gave Secord and 
North — whoever survived — the power to use the money for 
their own purposes? 

A Well, here comes the business phase of this 
enterprise, and I tried to explain the other day that the 
formation of the enterprise was most unconventional. 

We started out looking at it as purely a business 
enterprise, and as 1 got more involved, I saw signs and 
influences that was contradictory, so when 1 thought of that 
part, you know, that was sort of if we all die, then it is 
obvious we want our families to benefit. 

To me, after North, I had no other contacts. I knew 
no one beyond North. 

UHClA3Slf;£«wctAss.FiEo 



679 



mag 19 

1 
2 

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11 

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13 

14 

15 
end mag 
(12:00) 16 

17 

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23 

24 

25 



MR. JANIS: Can we go off the record a second? 

(Discussion off the record.) 

MR. JANIS: Back on the record. 

THE WITNESS: Did I answer your question? 

MR. LIMAN: I thought you answered the question. 
Let me just see if I understand it. 

If you and Secord and North were gone, then you 
couldn't see anything further in terms of this enterprise? 



39 



UNCLASSKie^ 



Si?!-- 



680 



uN^EilM^ 



40 



STEIN 
?:45 



CAS-1 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

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12 

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14 

15 

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25 



-A 



Exactly. 



Q So that you left it to North if both you and Secord 
were gone to decide what he wanted to do with the money in 
that eventuality? 

A That is correct. 

Q Now, did you tell Secord that you had made these 
provisions in the event of your death? 

A Yes, sir. 

Q Did Secord suggest that North be named? 

A No. 

Q Did he object to North being named? 

A No. 

Q Did you ever tell North that you had provided for 
him? 

A I vaguely remember saying words to the effect that 
if I should die, the enterprise can continue. He was worried 
that there was a damage control mechanism in the form — 

Q Why? You are now speaking like a Government 
official with words like "damage control". Was that your 
language when you were in Iran? 

A No, I am learning new language, sir. 

Q Let's go back to plain talk. Was he aware that you 
had made some provision — 

A That he would be in control. 

Q That he would be in control? 



681 



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41 



- A Yes. 

Q Have you ever heard of Robinette? 

A Yes, sir. 

Q And who is Robinette? 

A Robinette is to the best of my knowledge — I have 
come to see that I appear or I think I know a lot and then 
things turn out to be different — he was introduced to me 
as being a retired CIA analyst or official, and for some 
time. That he was employed by General Secord to help us 
out with this Florida lawsuit. 

Q Did you ever transfer money to Robinette to be 
given to the Norths? 

A Not I . 

Q Did anyone, to your knowledge? 

A I find that most unusual — no, I don't know. I 
don't know. 

Q You have testified about the fact that — 

A May I add something to — 

Q Sure . 

A — to the connection of Robinette and North that 
I just recall. It has nothing to do with the financial 
end of it. The only area that I recall that Robinette 
was in any way or form introduced to North was when North 
was being threatened and Robinette is an expert in security 
and he was asked to establish a security network for his home. 



682 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

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18 

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20 

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25 



■ Q And did you arrange to pay Y6r/atkt7 



42 



A I had no involvement. 

Q Did you know that the enterprise was paying for that 

A I have no knowledge of that. 

Q So you have no idea who paid for it? 

A I don't even know if .;uch a system was installed. 
I recall that that was an issue. 

Q Do you recall that it was Secord who told you about 
this or North? 

A Definitely not North. I would also eliminate 
Robinette. He doesn't talk. It must have been Secord. 

Q Incidentally, I can't resist it, but we find that 
also true of CIA people. They don't talk much. 

In the period from 1985, beginning of 1985 until 
November of 1986, when all hell broke loose, where did you 
make your principal office when you were in the United States? 

A Basically my home. 

Q In California? 

A In California. 

Q And you also spent some time, I take it, in the 
Virginia office of STTGI? 

A Very — during that period of time, very seldom. 

Q Did STTGI have a telex machine? 

A Yes. 

Q Were instructions communicated to Zucker by way of 



683 



1 

2 

3 

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/ 

8 

9 

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telex? 

A Sometimes. 




UNCnS 



43 



% 



•^•%^ 



Q Do you have copies of any of the telexes that were 
communicated to Zucker during this period with respect to 
these accounts? 

A Mr. Liman, when you said we communicated with 
Mr. Zucker by telex, are you referring to the contra/Iran 
initiative or our business relationship? 

Q With respect to transfer of money. I mean, I am 
well aware that telexes customarily are used in financial 
transactions to make a record of the instructions that you 
give to banks or managers. Isn't that your experience, too? 

A Yes . 

Q Was that practice followed by you? 

A Yes. 

Q And we do not seem to have the telex instructions. 
We may have some, but I eun asking whether or not you have 
copies of telex instructions that were given to Zucker with 
respect to these companies. 

MR. JANIS: I want to make sure there is not a 
misunderstanding. I think Mr. Hakim answered your question 
about telexes in the general. 

MR. LIMAN: If he gave an instruction to Zucker 
to transfer $50,000 here or transfer $70,000 there, what I am 
asking is whether there are telex instructions which we have 



UNCLASSIBEO 



nn*vn^i 



684 



CAS- 5 



1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

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13 

14 

15 

16 

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18 

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20 

21 

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23 

24 

25 



UNCLA^^( 



:CRET 

not been given that he is aware of, and if tnrrt'are such 



^^^^ss;;,; 



44 



instructions, I would like to get copies. I think they have 
been covered by the subpoenas and — 

MR. JANIS: Let me make my point because I don't 
think you understood. I am not sure that I understand 
Mr. Hakim. I think what he was trying to distinguish between 
was normal business transactions in which telexes might have 
been used and business transactions with the enterprise in 
which telexes may or may not have been used. 

THE WITNESS: That was' my question. Normally, when 
I wanted out of the U.S. to execute a transaction related to 
either the contras or the Iranian initiative, I always made 
it a point to do it by phone and talk in riddles and not to 
leave any trace. 

I do not exclude the possibility that sometimes 
we had to send telexes, and if we did, it is not my normal 
practice to carry copies of documents that should remain in 
the office. But I am willing to search. 
BY MR. LIMAN: 

Q Mr. Hakim, you mentioned in one of your earlier 
sessions that since November you have spoken to and seen North 
a few times, do you recall that? 

A Yes. 

Q When since November of 1986 have you seen North? 

A There is a — I believe 



UNCLiaStftfft. 



I believe — well, I am 



Pt?ni 



685 



CAS-6 1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

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24 

25 



TOP SE<S«S,T^ 



45 



sure I met him in the Sheraton Hotel. I also believe that 
Mr. Green was present and Mr. Secord was there. 
Q When was that? 

A I don't remember. So that must have been prior to 
my retaining Mr. Janis. 

Q What did you discuss? 
MR. JANIS: Hold it. 
(Counsel conferring with witness.) 
MR. JANIS: To the extent you are asking 

Mr. Hakim to report on conversations that took place 

G 
involving Mr. g'reen, those conversations are subject to the 

attorney/client privilege and, therefore, Mr. Hakim cannot 

answer that question. 

MR. LIMAN: Well, not every conversation that you 
had with Colonel North in the presence of Mr. Green is 
privileged and I think you can invoke the privilege as to 
those portions which you think are covered and let him 
testify as to the rest. 

BY MR. LIMAN: 

Was Mr. Green representing you at that meeting? 

Yes. 

Was he representing Mr. North at that meeting? 

Yes, and also Mr. Secord. 

And he was representing Mr. Secord? 



Yes, sir. 



UNCI A.^iSIHKb lJfi!9^|ifiED 



686 



CAS- 7 1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

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17 

18 

19 

20 

21 

22 

23 

24 

25 



■ Q And the testimony has been that wl . 



46 



Green withdrew 



from the representation of Mr. North in about the third or 
fourth week of November. I think I have a letter that 
indicates that he withdrew somewhere around November 27, 
1986. Do you recall when this meeting was? 
A It was — 

MR. JANIS: Was this before Mr. North had another 
attorney, Mr. Sullivan, or afterwards? 

THE WITNESS: It was before he had his own attorney. 
BY MR. LIMAN: 
Q Do you remember was it before he was fired or after 
he was fired from the NSC? 

A I think it happened — I don't know exactly when 
he was fired. 

Q Well, he was publicly fired by the President of the 
United States on Tuesday, November 25th. 

A Then he was not fired, because I believe at that 
time I was even out of the country. I can consult my 
passport and see. I believe that at that time I was not even 
in the country. 

Could you excuse me one moment? 
Q Do you want to step out and consult? Would you 
please, because we have discrete dates — 
MR. JANIS: Off the record. 
(Discussion off the record, and consultation 



UNCLASSIfJEBti^'QMKiF 



m 



687 



BNCBiSl^^ 



47 



^-5-^/; 



between witness and counsel outside the room.) 



%0 



1 

2 MR. LIMAN: Back on the record. 

3 MR. JANIS: The bottom line on our — on Mr. Hakim's 

4 position is that any discussions that took place with 

5 Mr. Green and Mr. Secord and Mr. North and Mr. Green at 

6 the same time are covered by the attorney/client privilege 

7 and he is not at liberty to discuss those matters. Not only 

8 can he not waive his own privilege, but he can't waive the 

9 privilege of the other people. 

10 BY MR. LIMAN: 

11 Q When was the last time you saw Colonel North? 

12 A I haven't seen Colonel North for many months now. 

13 Q Have you seen him since you were represented by 

14 Mr. Janis? 

15 A No. 

16 Q When was the last time you spoke to him? 

17 A I haven't spoken with him for many months. 

18 Q I)i-<3 he send any messages to you through anyone 

19 els«? . 

20 (Witness conferring with counsel.) 

21 THE WITNESS: No. 

22 BY MR. LIMAN: 

23 Q There has been some testimony by you about the 

24 fact that at one time General Secord told you that he 

25 wanted to foreswear his share of profits; do you recall that? 



688 



UNCUsMEf^ 



48 



%M^ 



CAS-9 1 ■ A Yes, sir 

2 Q When was it that General Secord told you' that and 

3 what did he say to you? 

4 (Counsel conferring with witness.) 

5 THE WITNESS: I cannot exactly remember the date, 

6 Mr. Liman. 

7 BY MR. LIMAN: 

8 Q Was it before the Iranian sales began? 

9 A I believe so. 

10 Q Give us your best recollection of the date. 

11 A I believe it was during the time that he was 

12 frustrated with the CIA. This is to the best of my 

13 recollection — that it was during the time that he got into 

14 one of his general moods and wanted to go back to the Governmei 

15 and straighten things out. So that — 

16 Q What do you link that with? 

17 (Counsel conferring with witness.) 

18 THE WITNESS: Can you give me a date on the time 

19 that Dutton and Secord and North were trying to sort out their 

20 relationship with the CIA and the Government in connection witl, 

21 the contra activity? 

22 BY MR. LIMAN: 

23 Q You mean about disposing of the assets to the CIA? 

24 A Or sometime before that, yes. 

25 Q They began those discussions when Congress adopted 



wmm. 



i?T?T 



689 




^fi!) 



CAS- 10 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 



legislation that was repealing Boland and that would have 
been either — the legislation was adopted or it was 
signaled in or around June of 1986 if my recollection serves 
me correctly. 

A I would say that is a close time, that time frame. 
Q What did he say to you? 

(Counsel conferring with witness.) 

THE WITNESS: You are talking about 1986, aren't 
you? 

BY MR. LIMAN: 
Q That is when this happened. 

MR. JANIS: I am sorry. Can we take a minute to 
try to reconstruct this? 

I want to make sure he is being accurate. 

(Counsel and witness leaving the room.) 

MR. JANIS: Could we hear the last question again, 
please? 

(Whereupon, the reporter read the pending question.) 

BY MR. LIMAN: 
There is a question pending, what did General 
Secord say to you? 

Mr. JANIS: I would like to go back to clarify 
the time — 



BY MR. LIMAN: 
Q Sure, go ahead. 



ifiy«D 



690 



CAS-11 ^ A The elements that I can reconstruct in my mind to 

2 go by to try to determine the time are the following: 

3 It was, to the best of my recollection, prior 

^ to the last distribution of the commissions on the contra 

5 sales. 

6 Q The stranded weapons? 

7 A Yes. And it was also at a time that Richard had 

8 reached the limit of his frustration with the CIA. These are 

9 the things that I recall. That is why I related that to the 

10 time that they were sorting things out. And then I asked you 

11 about the time that they were trying to sort out — I would 

12 say it was some time in early to mid-1986. 

13 Q Is one of the reasons that you can't place the date 

14 more precisely that there is no written record of this 

15 waiver? 

16 A That has never been our method of operation, to have 

17 records, but — 

18 Q Yes or no? 

19 A Yes. 

20 Q Is there a written record of this waiver? 

21 A No, there isn't. 

22 Q Did you ever give any writing to Mr. Zucker 

23 saying that the profits in the Korel account are no longer to 

24 be held for General Secord? 
25 



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UNCDUffi'^^ir 



51 



■ Q Did the conversation that you had with General 
Secord in which he said that he didn't want to participate in 
the profits take place before or after you named him in these 
so-called wills? 

A Before. 

Q What did he say to you? 

A He said to me, to the best of my recollection, 
that there might be a possibility for him to go back to the 
Government and, if so, he doesn't want to have any taint 
from these operations. 

Q Did he continue after he gave you that statement or 
expression to give instructions with respect to the enterprise: 

A Yes. 

Q Did he offer to give back the money that he had 
withdrawn previously as his share of the commissions? 

A Intend to — to whom? 

Q Did he offer to give back to you or the 
enterprise the money that he had withdrawn previously as his 
share of commissions? 

A I don't know — you mean actually withdrawn? 

Q Yes. 

A I am not aware if he withdrew any money. I would 
have to consult the records. I don't recall — if he 
withdrew money, I don't recall any statement by him telling 
me that he withdrew money and he was going to return it. 



«NCUSSin8!h>.,„ 



692 



mmifF^ 



52 



CAS-13 1 Q Did this conversation he had witH'yTO^take place 

2 before or after you were looking at investments for Tri- 

3 American Arms? 

4 A I believe it was way before that, to the best of my 

5 recollection. 

6 Q Did it occur before you transferred the $150,000 

7 to TriAmerican Arms? 

8 A Before. By the way, there is one thing that I would 

9 like to mention that — when you were asking me about 

10 Mr. Zucker, if I gave him any instructions about these 

11 monies. I believe I loosely mentioned to Mr. Zucker that — 

12 MR. JANIS: Hold on for a second. 

13 (Counsel conferring with witness.) 

14 THE WITNESS: At one point I may have told 

15 Mr. Zucker that Richard has told me that he may go back to the 

16 Government, just to that extent, no further. 

17 BY MR. LIMAN: 

t8 Q You testified that from time to time you and 

19 General Secord would visit Mr. Zucker 's place of business 

20 And look at the records, 2un I correct? 

21 A Yes, sir. 

22 Q From the time that you and General Secord began 

23 doing the business that became the enterprise, let's say 

24 first with the sale to Calero and then right through to a 

25 second channel, were his share of the commissions and then of 



UNIUSSiEO^^u 



SSIFIFT) 



693 



uliUBeiW^'^. 



53 



profits always put under the name of Korel? 



%0 



CAS-14 1 

2 A Yes, sir. 

3 Q I want to ask you something which I will treat 

' 4 as, again, code word, top secret marked as the next exhibit, 

5 a sheet of paper which has two names which I intend to 

6 share with John Nields and his minority counsel, but 

7 otherwise keep it closely held. 

8 (The document, A^H^-Exhibit_2Q«. was.roarked for 

9 identification.) 

10 BY MR. LIMAN: 

11 Q I don't vouch for the spelling,' but was the neune 

12 which has number one after it the person who introduced you 

13 to the second channel? 

14 A Yes, sir. 

15 Q And is the name which has the number two after it 

16 the person who he brought into it to set it up, the second 

17 channel? 

18 A Yes, sir. 

19 Q And were these people going to be partners with 

20 you 2md General Secord in the Iranian market business? 

21 A Yes, sir. 

22 Q Now, would you please explain to me — and I can 

23 assure you the transcript doesn't really tell the story — the 

24 discussions that you had with the second channel people about 

25 supplying them with me_dicij^e^jjpg^5gl supplies. You 



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!RET 

have testified to it, but I have read the transcript and I 
still don't understand it. 

A I believe this thing — that the reason it is 
confusing is because of my approach as a little guy in this 
whole chain and the approach of the — what I call the 
principals. 

Q Just tell us when did this subject first come up — 
A I am coming to that. This subject of medicine 
came up even prior to us starting the search for the 
second channel . I always subscribed to approaching the 
Iranians even during the time of the so-called first channel 
on the basis of showing our interest in their country, showing 
American interest in their country by helping them out with 
medicine and doctors, helping them with the victims of the 
war and so on. 

So I started an effort personally with a channel 
that existed and had nothing to do with a second channel, 
and I believe I was shown some documents that were given to 
the committees from our company in connection with the 
madicine and so forth, a certain doctor, his neune is on these 
telexes. 

I started this initiative of giving free medicine to 
Iranians parallel with the activities of channel one. So that 
sort of spilled over. It remained dormant and when we 
started with the second channel, we threw that in as a 



mmm. 



nWFHP 



I A , 



695 



CAS-16 1 
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1)NCLASJIWE8E«S|T 



55 



sweetener. 

Q What did you tell them, that you would sell them 
medicine on credit? 

A No, no, they knew all along that we had set aside 
three pallets of medicine that w?s — I believe it was 
set aside^^^^^^^^^^^^|, because was told either by 
General Secord or Colonel North that there were three 
pallets packaged wit? 




So that was set aside to be shipped to them free of 
charge. 

Q And where were these pallets, where were you told 
these pallets were? 

A I got the impression that they were with the - 
manufacturers because when I was pushing for these pallets 
to be shipped, I was told that the people were on vacation, 
holidays, company holidays and so forth, and they just 
couldn't do it. 

My impression was that they were with the 
manufacturers . 

Q And so these pallets were going to be shipped by 
the United States Government? 



A No. 



Q Well, who was paying for them? 



iMGuma. 



UNCLAS:""=0 



EOL 



696 




S 




%' 



56 



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A I think it was a donation from the manufacturer — 
that was my impression, that it was a donation from these 
manufacturers — 

Q To whom? 

A F^rom our group to the Iranians. 

(Counsel conferring with witness.) 

THE WITNESS: Mr. Liman , I was told that they were 
donated by the manufacturers. That was my impression. 
BY MR. LIMAN: 

Q So you were told by either North or Secord that thes< 
pharmaceuticals were donated by the manufacturers; is that 
right? 

A Yes. 

Q And to whom did they donate them? 

A My impression was that this was intended to be — 
I may be speculating — 

Q Were you told that these were donated for the benefi. 
of the^^ 

A My understanding was that they — from the same 
line they managed to get three pallets to give it to the 
Iranians. 

Q When you say "they", you mean again General — 

A The Government. 

Q Well, who in the Government managed to get these? 

A Colonel North. 



697 




CAS-18 



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57 



Q And did you understand that the manufacturers 
were told that they were donating to Iran? 
MR. JANIS: If you know. 

THE WITNESS: I don't know that. I have no idea. 
BY MR. LIMAN: 

Q 3ut didn't you start this line of testimony by 
saying that you understood that this was a donation that 
was intended originally for the^^^^^^^^^^^Hand then 
Colonel North or General Secord indicated that it could be 
used for the Iranian initiative? 

A If I gave you that impression, I misspoke. I 
meant to say that it was a donation for the Iranians and it 
was from a shipment that was intended, or a line of shipment 
that was intended for 

Q But this wasn't a case of Colonel North diverting 
medical supplies from the^^^^^^^^^^^Hps you understood 
it as it was presented to you? 

A That is not what I understood. 

Q Did you discuss this with anyone else in the 
United States Government, Mr. Cave, for example? 

A I don't recall having done that. 

Q Did you have any sense of what the value of this 



shipment was? 



UNCLASSIFIED 

:he seco 



698 



CAS- 19 1 

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I 



lED 



58 



expect these supplies? 

A I believe when I was left to repair the damages aftei 
the discussions broke off between the American group and the 
Iranians — if I am not mistaken, it was at that time that I 
threw that in. 

Q At the time you were opening up the second channel? 

A No, no. We were well into it. 

Q When you say "when they broke off" — 

A I eun referring to the time when I came up with the 
representative of the Iranians with the so-called nine 
points. I believe about that time or maybe a week before 
that. 

Q Do you remember when the news broke that the United 
States had shipped arms to Iran at the end of October, 
beginning of November? 

A You are talking about the time — 

Q The Lebanese newspaper leaked the information? 

A I believe at that time X was out of the country, 

Q But you heard soon afterward — 

A Yes. 

Q — that this had become public? 

A Yes. 

Q And that the White House was coming under some 



y««. 



criticism? 




SlFltO 



699 



end «3 



CAS-20 ■* 
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mmm 



RET 



59 



'<^ 



A Yes, sir. 






UNia4SW^«^ 



700 



1 

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UNCUMlf"^ 



^S/fj 



60 



Q Were you asked at that time to speak to 



3 ctre sec 



ond 



channel to see whether they could obtain the inunediate release 
of the hostages? 

A Yes, sir. 

Q Who asked you to do this? 

A Either Colonel North or General Secord or bcth. I 
don ' t remember . 

Q Did they tell you this was important in order to 
quiet the criticism that was being directed at the White 
House? 

A I don't know whether it was told to me in exactly 
those words. 

Q What were you told? 

A I can tell you what was my impression. 

Q Give us first what was the substance of, if you 
recall it, of what you were told. 

A The substance of what I recall was if these god- 
damned Iranians would have kept their promise, none of this 
would have happened. 

Q And the promise was to deliver the hostages? 

A The promise was to deliver two hostages, which I 
have ~ which I had continuously told them it won't happen. 
I told them what my sense was. 

Q You had continuously told Colonel North and Secord? 
A And Secord that they could not expect more than one 

yNClAS! MUcvAss..a > 



701 



1 

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25 



and that is exactly what happened. I had a goo^ 



Mss,. 



ood^en 



61 

se of 



what was going on, and they ignored that. 

Q Was it your sense that they didn't have control 
over the other hostages or that they needed one in the bank? 

A No, my sense was that they did have control over 
the hostages if they could do certain t^'ings for the Lebanese. 
They had ]^ out of credit with the Lebanese. That was my 
impression, and later on it proved to be right, my impression 
was correct. 

Q And did some of the things that they had to do for 
the Lebanese depend on what we could do for the Iranians? 
A What we could do for the Lebanese. 
Q And what was it that we had to deliver to get the 
hostages? 

A To settle the problem of the Dawa prisoners with 
Kuwait. That was really the heart of the problem. 

Q And you made that clear not only to Colonel North 
and to General Secord, but I assume to Mr. Cave? 
A I told them that — 

MR. JANIS: Just answer his question. 
BY MR. LIMAN: 
Q Yes, then you can tell me what you told them. 
A Yes, the answer is yes, I told this to all the 
three gentlemen that you mentioned. 

Q And do I understand that the problem was that you 



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ONCUMlf ^.,^ •■ 

were told by your Iranian contacts that the Hi;^4Q|^h 

was saying that if you want us to deliver, you have got to 

get our prisoners back? Is that, in essence what it was? 

A That is correct, but you see this is not what 
General Secord, Colonel North and Mr. Cave were hearing. I 
was hearing it. They weren't. 

Q How can that be, that since you are reporting to 
them that you hear it and they don't hear it? 

A Because, as you very well know, the way the Government 
of Iran is structured, there are a number of factions, and 
I managed through one and two to create some sort of an 
understanding between two groups back there and more. I was 
communicating and listening to the person that was more 
realistic and was not promising a lot and a person that I 
have a lot of respect for. I didn't know this man from before, 
and he called a spade a spade. He didn't exaggerate. 

Then there was another person that apparently 
knows American mentality better, and he told them what they 
liked to hear, and that was easier to deal with than the 
hard position that the other person was taking, the man who 
indeed was involved with all these activities, a man that, 
who risked his life by getting involved in this. I have 
immense respect for this person because he really went out 
of his way to get this thing going, and nobody wanted to 
listen to him, because it was not pleasant. What he was saying 



703 



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BNOiSlf^ 



63 



^^ 



T 

was not what they wanted to hear. 

Q Okay . 

A So they listened to the other guy. 

Q Let me move to another issue, and then I want to 
come back to this issue of policy. 

MR. JANIS: I think our lunch is here. 

MR. LIMAN: This will be quick. 

MR. JANIS: I know, but I just wanted you to know. 

BY MR. LIMAN: 

Q Remember, you were asked about the Codelis account. 

A Yes. 

Q Payments which were transferred to Codelis. 

A Okay . 

Q Do you know someone who works for the Republic 
Bank by the name of Nancy Morabia? 

A I have not met her, but, yes, I have spoken with 
her. 

Q Do you know whether Nancy MoreOiia was obtaining 
cash to be disbursed at General Secord's instructions and 
that the customer of hers who was providing the cash was 
being reimbursed by these transfers to Codelis in Switzerland? 

A If I remember correctly, I don't know Codelis, but 
what you are describing I am familiar with the movement. 

Q You are familiar that she obtained cash and that 



there was a reimbursement in Switzerland. 



lINEUSSm. 



ttMClASSlFlED 



704 



drg-5 



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UNCuJ9FlfipsBsra 



64 



A Yes, it was not by instructions of Secord. By my 
instructions. 

Q It was by your instructions? 

A Yes, sir. 

Q What was the cash to be used for? 

A For the contras. 

Q And that cash was then delivered to couriers who 
would bring it to Colonel North for the contras? 

A To General Secord and sometimes I brought it myself. 

Q And when you say it wasn't by the instructions of 
General Secord, General Secord was the one who gave you the 
request? 

A Exactly. 

Q Did General — did Lieutenant Colonel North ever 
make the request directly to you? 

A No. 

Q And so General Secord would make the request to you, 
and then you would arrange it with — 

A In whichever form that I could. 

Q And then you would arrange it with her? 

A Sometimes, yes. 

Q And when — 

A Earlier we testified about the $9,500 — 

Q That I know. 1 wasn't asking about the $9,500. 



Yes, sir., 



mmsL. 



705 



1 

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yNCLAS«^««^^, 



65 



Q One last question, and then let's take some lunch. 
You have heard over the six-seven months that have gone by 
since this whole thing beccime public the whole debate about 
whether we are dealing with moderates or not moderates in 
Iran. I would like to have a statement from you on the 
record as to whether your view was that you could open the 
door to Iran by identifying and dealing with "moderates"? 
A The answer is definitely yes. 
Q And explain, please. 

A I believe that I understand the structure of the 
Iranian Government reasonably well and how they operate. I 
understood then, and I understand now the influence of the 
different factions. I understood then, and it proved to be 
correct, that there was a faction so-called the third faction 
that was responsible for all terrorist activities and the engim 
behind this third faction, he had covered himself in, under 
the umbrella of a certain important person, which I would not 
mention his name, an Iranian person. 
But this man! 




followed a philosophy that the only way they could expand the 
Islamic revolution was through terrorism, and outside of 
that third faction, my understanding was and is that the 
rest can truly be considered as moderates, with the exception 
of the people that we were dealing with were moderate. 



706 



drg-7 



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In other words, I do believe that one cirf success- 



fully reach agreement with any of these factions without 
the influence of that third faction, which by now is brought 
under control ,^^^^^^^^^^^^^^^H and so 

Q There may be an issue of semantics here. 

A Yes. 

Q That, as you have used the term "moderate", you are 
including in that term Mullahs and others and others who 
publicly denounce the United States as Satan. 

A Yes, I do, yes. 

Q And you are including religious fanatics? 

A I am saying that the religious fanatics have no 
control over the foreign policy of Iran, and I eun also saying 
that statements that they make is out of lack of sophistication 
in their technique of thinking that they can outwit the United 
States. They are not that experienced. 

MR. LIMAN: We will take a break. 
(Whereupon, at 1:00 p.m., the Select Committees 
were recessed until 1:35 p.m. the same day.) 



wmmi 



""^*^ ^^ 



gjucus siFiro 



707 



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uNimiiif^^ 



"'%, 



67 



AFTERNOON SESSION 



/SO' 



Whereupon, 

ALBERT HAKIM, 
resumed the witness stand, and having been previously duly 
sworn, was examined and testified further as follows: 
BY MR. LIMAN: 

Q Let me just ask you, Mr. Hakim, is there anything 
more that you recall about the efforts that you made through 
Mr. Zucker for the benefit of the North family? You have 
testified to the fact that Zucker met with Mrs. North in 
Philadelphia, you testified, as I recall it, that Zucker did 
not report to you any of the details after that meeting, you 
testified about the discussions about trying to have Mrs. 
North employed by someone in the real estate business, 
you testified about the fact that Zucker was supposed to 
talk to Mrs. North about her family structure and whether 
money could be passed that way, and you testified this morning 
that to the best of your knowledge no money was actually 
passed to the North family. 

Is that a fair paraphrase? 

A That is correct. 

Q Is there anything more that you can tell us on that 
subject? 

A I think that fairly covers it. 

MR. JANIS: Can we have a moment? 



y mssm. 



I AQcinm 



708 



1 

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(Witness consults with his attorney.) *-' 



%% 



68 



MR. LIMAN: You also — 

THE WITNESS: In this area, that you ask me 
questions of anything else, you are talking about actual 
events that took place that I know or you want me to speculate 

BY :;R. LIMAN: 
Q Well, I will take first what you know, and if there 
is something else you have to add, I want it, because I must 
say that the record, as I read it now, is that you planned to 
try to get some money to the North family for the education 
of the children and for death benefits, but that you are vague 
on whether you discussed it with North, and it looks like 
there is a lot of activity going on behind Colonel North's 
back except for that contact with his wife, and I have 
difficulty understanding how that can be, how it can be that 
youj*ould do these things and not talk directly to Colonel 
North or have Secord talk to him and report back to you. 

A For a niJinber of reasons. It has to do with me, 
and it has to do also with the structure. I explained earlier 
in a different context how we three operated. It was not a 
situation that we caucused, the three of us, for anything. I 
may be exaggerating when I say anything. 

For instance, when we were talking about the second 
channel, we did talk about it. But in the area of your interest 
there was never a situation that I sat down with Ollie and 



lEusmiu. 



709 



1 

2 

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DRBBKafflKT 



"^'^SSffi 



69 

Richard and said, "Okay, this is for you, this is fo'r'^ou, 
and this is for me" — never such a thing occurred. 

And the things that — the activities that you see 
happening, as you put it, "behind North", and I didn't talk 
to him about it, I say it has to do with me. I have a lot 
of experience dealing with government officials. I like to 
stay away from them as much as I can. 

Q You couldn't do that in Iran. 

A Pardon me? 

Q In your career in Iran, you couldn't stay away from 
government officials, as you testified. 

A That is how I learned. You see, I knew what was 
acceptable there and what was acceptable here or not accept- 
able here in the United States. I — because of my experience 
in Iran and because when I Ccune to live here, and I became 
witness for the government in the case of 01 in, I went 
through a whole lot of exercise in becoming — 

Q Americanized? 

A — becoming acquainted, yes, Americanized and 
becoming acquainted with the ethics of the United States, so 
I knew that was a no-no, and I didn't want to have anything 
to do with it. 

Q But you did have something to do with it, Mr. Hakim, 
you did send Zucker to speak to Mrs. North, correct? 



Yes. 



uMcuimu 



IFIEO' 



710 



UNESSSSfiEPS, 



«'f/ffl '• 



Q And he was trying to find a disguised way to make 
payments for the — 

A That I testified about. 

Q Yes, you did. 

— for the benefit of the children, is that correct? 

A Yes. 

Q And is there any doubt in your mind that if 
Zucker contacted Mrs. North that Oliver North would know who 
was sending Zucker? 

A I would have found that maybe it would have taken 
time, but eventually I would have found it impossible for him 
not to know. 

Q So given that, those sets of — that set of facts, 
you know the question just sort of leaps out, why did you not 
talk to him about it openly? 

A Because he, for one thing, he will never trust me. 
He didn't have that much contact to sit down and talk to me 
about such things. 

Q But couldn't he have cut you out of further dealings 
with Iran if he felt that this was improper, what you were 
trying to do? Mr. North — let me put it this way — Colonel 
North could have said, "I don't want Hakim involved any more 
in any of our Iran Initiative." 

You understood that, correct? 



Yes. 






SSlFItO 



711 



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ll(WSIfWa'^««s> 



71 



■ Q And you understood if Colonel North had said that 
to Secord that Secord would have had to abide by that? 

A That is also correct. 

Q And, therefore, when you sent Zucker to see Mrs. 
North, did you have a concern that Colonel North might become 
upset by that? 

A Absolutely not. 

Q And was that because somebody said something to you 
that this would be not poorly received? 

A That was not the spirLt at all, Mr. Liman, not at 
all. 

Q But you had a discussion with General Secord in 
which he said $500,000 was too much, right? 

A Yes. 

Q Then he told you that $200,000 was something, or 
at least he didn't object to $200,000 being set aside, correct? 

A Yes. 

Q And that was when you were talking about a death 
benefit, correct? 

A Yes. 

Q Were you also talking about using the interest at 
that time to help the North children get through school? 

A Yes. 

Q And was it a fact that General Secord had not 
objected to the $200,000 that led you to believe that North 



mm 




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would not become angry at the fact that you have Zucker speak- 
ing to his wife? 

MR. JANIS: Just a moment. 

(Witness confers with his counsel.) 

THE WITNESS: Can you break down your question? 

BY MR. LIMAN: 

Q Let me just try to give it to >ou this way. 

A Can you get to the bottom line? That is easier 
for me to deal with. 

Q I think it is easier, ^nd I will do that. 

A That is my style. 

Q I understand that, and I understand you are looking 
for what the meaning is in all of these questions. 

A Because I want to get to where I want to go. 

Q There are 26 Members of Congress on this panel, 
the two committees. I think that if somebody who is doing 
business with the committees were to approach their wives and 
offer to put their children through school, every single one 
of them would become outraged. You can understand that. 

A Yes. 

Q Yet even though Oliver North was important to you, 
you sent somebody to speak to his wife to offer to provide 
some financial assistance, correct? 

A Yes, sir. 

Q How is it that you were not concerned that Oliver 






ASSIFIFD^ 



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73 

Noxth would not become outraged and inunediately cut you out 
of these transactions? 

A I understand absolutely what you are saying. It is 
a very important issue. 

Q All right. 

A It definitely didn't occur to me that way. It 
could have had the risk that if he would have become outraged, 
he would have thrown me out of the team, and then I find my- 
self to be — I am thinking out loud — to be very perceptive. 
It is very possible that, without having had any meetings, as 
you refer to, I might have gotten the impression that he 
would not be outraged; therefore, I didn't sense any risk and 
went ahead with it, but I do not recall any direct arrangement 
to set up such a benefit program for North, his family or 
North. There was no such — 1 have become sensitive to the 
issue that you are raising, Mr. Liman. It is a valid one. 

Q You want to think edsout it? 
MR. JANIS: Excuse me. 
(Witness confers with his counsel.) 
BY MR. LIMAN: 

Q Go ahead. 

A What I am trying to conclude is that it appears 
that through a period of operation I was led to believe, as 
a result of my contact with Richard, that, you know, after 
all, I did pass this one by Richard, and if Richard did not 



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74 

object to it to me, automatically it meant that OlTie would 1 
not object, but this is not what went through ray mind when it 
occurred, Mr. Liman. 

When you are presenting it so brightly, this issue 
now, and I am trying to go back to the time that these things 
happened, the sense of it was that if Richard, if I tested 
the case with Richard and Richard did not object, Ollie would 
not object. Do you follow what I am trying to say? 

Q I understand that. 

Now, did someone tell .North that Zucker was going 
to be calling his wife? 

A I would find that very strange if Richard did not 
call North and tell him that such a thing was happening, 
although we didn't discuss it. 

Q And you didn't discuss with Secord that he should 
call North and tell him? 

A Right. 

Q But you did tell — 

A I don't believe in miracles. 

Q But you did tell Secord that Zucker was going to be 
getting in touch with his wife, correct? 

A Yes. 

Q Now, after the conversation between Mrs. North and 
Zucker, the effort continued to find a way of getting the 
money to the Norths, correct? 



WICUgm^Fi^' 



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BNCEKSSIM&fiSi? 



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75 



Yes. 



Q So that whatever happened at that meeting between 
Zucker and North did not cause you to shut this down. 

A Absolutely correct. But you do understand that I 
am not hesitating because I am trying to protect North. I am 
hesitating not to speculate more than what I know and more 
than actually what happened. I want to be very, very precise. 

Q Well, the question that will be on the minds of 
some people is whether you were trying to compromise North 
so that you would have some leve.rage over him. 

A I don't think so. I rely heavily on my own 
competence and contacts. I really did. And I seill do. That 
has been my strength; even now I am going ahead without any 
North or similar to him, or Richard, or the support of the 
U.S. Government. I have established a workable legal com- 
mercial network with Iranians. It is already producing. I 
don't think that was my motivation. I am a good marketing 
man, Mr. Liman. I can penetrate any market if I set ray mind 
into it. 

Q Was it your motivation, in putting North's name on 
the so-called will, to compromise him? 

A No. That was not my intention, no. 

Q Let's go to the medication. I thought I read in your 
prior testimony when I wasn't here that you testified that 
there were some discussions with the Iranians about selling 



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them the medicines on credit. Am I imagining that? 

MR. JANIS: Mr. Liman, I am not vouching for the 
fact that I didn't miss something, but I don't recall any 
such testimony. I do recall Mr. Hakim produced some telexes 
which were part of Deposition Exhibit 7, I recall. 

THE WITNESS: I believe I know what Mr. Liman is 
asking. 

MR. JANIS: Let's look at Exhibit 7. Do you have 
Deposition Exhibit 7 in front of you? 
MR. LIMAN: Do you have 7? 
MR. HOLMES: Yes. 

MR. JANIS: There are some telexes there that deal 
with the medicine. 

BY MR. LIMAN: 
Q Did you have any discussion with the second channel 
people about selling pharmaceuticals to them? 

A No, sir. If you refer to one of the items of the 
nine points, that's very evident. 

MR. JANIS: It is in the Farsi document, but it is 
also part of Deposition Exhibit 7. 

Q Have we ever had you explain what the nine points 
were? 

A We never got to that. 

Q Why don't you tell us what the nine points are? 

A That is the heart of the whole thing, and nobody has 



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beeih in any — may I ask you first a question? 



m 



77 



MR. JANIS: Can we go off the record, first? 

MR. LIMAN: Sure. 

(Discussion off the record.) 

BY MR. LIMAN: 
Q Let's go into the nine poins and get this s«-ory 
on the record. 

A Let me first, if I may, answer your question about 
the sale of pharmaceuticals through the second channel. This 
item 2 of the nine points, which- I will go into shortly, 
very clearly says that medicines will be given to them as a 
present. 

Q Now you can tell us about the nine points. When 
were they developed? 

A It has a date on it. 

MR. JANIS: Read them this line here. 

THE WITNESS: It starts out, the 16th of the 7th — 
I am not sure. It is written, by the way, by the real McCoy. 
It is not any of those — this is the result of my discussion 
with the person that I referred to as the one who risked his 
life getting involved in this, a man who risked his life 
getting the third faction out in the open, and this is the 
man who called a spade a spade, and nobody wanted to listen 
to him. 

MR. LIMAN: Off the record a moment. 



(Discussion off the reco 



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take 5 

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78 



BY MR. LIMAN: 



%fb 



Q This, you say, was written by the real McCoy? 

A This is the realj McCoy. ' He was ^ferred to by the 
McFarlane group as the monster, that he called a soade a spade, 
and he never misled the Americans. 

Q When you say he was referred to by the McFarlane 

group as a monster, was he a person the group had met with? 
» 

A He was there, yes, in Tehran and he was present in 
the military group. 

Q In Frankfurt? 

A In Frankfurt. 

Q Which was the earlier meeting? 

A Yes. 

Q When did he draw the nine points? 

A I refer to this man as the engine and the heart of 
this. He was also the man that — 

Q We know who we are talking edaout — 

A Yes. 

Q I understemd who you are talking about. We will 
call him the engine. 

A The engine. Ke was also — he is also the same 
gentlemam that I earlier testified when I was asked to arrange 
a meeting between the State Department and the Arabians, he is 
the rosm in December who met with them. So this is the -- 
It says 16th of the 7th. I don't know whether it is referring 




!CLASSIF.HD 



719 



UlffiBBflBF^ 



79 

^ Iranian dates or -- I just can't remember now -- if that 

2 meeting took place in July, this is the 16th of July, or it 



could be their Iranian calendar. 

Q I think it is the fall. So 16th of 7th, so we 
have to see. 

Q I can get the dates if you will tell me who was at 
_ the meeting. 

A Just he and I, two people — The Engine and I -- 
it says resolution between us, meaning the Ireinians and Hakim, 
16th of the 7th, evening throughout the night. And this 
occurred after several days of discussions with the -- between 
the two delegations and it failed. 

And Oliver North left, and he told me that I had 
six hours to either shut this channel off or come up with 
something acceptable, because in six hours when he landed in 
Washington, he had to report to the President. In those words 
And that is why The Engine euid I sat down emd worked real hard 
and Richard had to attend a business meeting that we had in 
Europe with the understanding that he would come back early 
next day to see what I have achieved so we could communicate 
that to North. 

I will come back to the nine points briefly. When 
I reached this agreement with The Engine, I called Fawn and 
she told me that — Ollie had called from the airport eind was 
on his way to the office. And I called again and I talked to 



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Ollle. I did not have the KL-43. I coulci not compromise our 
telephone conv-rsation. I tried to talk to him in riddles 
and he couldn't understand it, especially when I said we have 
agreed on one and a half hostages, he thought I was drunk. 

I said, Ollie, all I want you to do is delay your 
report to the President until Richard gets here and I go over 
this with him. We will send you a KL-43 message. He agreed 
to that. And this is exactly what we did. Next day when 
Richard came, we went over this and we sent a message. 

To back up and tell you how this thing was created, 
during the discussion that we had with the Ir2mians, Ollie 
presented the so-called — the US proposal, the seven points, 
and they could not reach an agreement on this. So this was 
left with me, and I believe you have the original of it, 
which I provided as part of the documents that were subpoenaed 

And I redefined the seven poin-^s into nine points, 
which if anyone should take the seven points and compare it 
with the nine points will see that I made the position of the 
U.S. side more flexible and more critical — or rather, excuse 
me, less committal than the seven points. And that came as 
a result of my trying to fill in the gap, not as a translator, 
trying to — trying to make them understzuid what the Americans 
are after and for me to understand what the Iranians were aftei 

So we reached that agreement -- if you want me to 



go over this — 



UNCm<;tEl»).' 



UNCLASSIFIED 
■cm 



81 



721 



1 - Q Yes sir, I would like you to gover over this 

2 A By the way, I gave a copy of this — that is very 

3 important -- to George Cave in the Pan Am Club in Frankfurt 

4 Airport as he was getting ready to leave for the United States 

5 requesting him to get this translated and get it into Ollie's 
g hands. I don't know whether it ever got there or not. That 
7 is even prior to sending the KL-43 with the help of Richard 
o Secord 



g The nine points read that the Iranians, if willing, 

will pay the money for the 500~rous"— they referred to Tows 
and "Tous" — the Iranians would pay for the 500 Tows and 
if willing, for the Hawk spare parts, which has remained 
unsotllted from previous agreements to Mr. Hakim. 

I don't want to beat my own drum here. I am trying 
to give you information that hopefully it will be used in the 
future attempts, because sooner or later there should be an 
attempt between these two nations to try to get together, and 
personal trust is extremely important. 

So specifically, although they recognized that I am 
not a government officials, they recognize that I am a business 
man — and that was discussed repeatedly in the September 
meeting and the following meetings — that I was there to make 
a profit — but still they sait' that the money would be paid 
to Albert Hakim. And in parens that says, by the way, "the 
payment for the shipment of 500 Tows through the second 

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1 channel, they gave me a blank check. They signed it, I filled 

2 in the check. 

3 Q The money for the Hawk parts wouldhave had to go 

4 to reimburse Mr. Ghorbanifar? 

5 A No. There is no — the second channel did not 

6 approve of Ghorbanifar, did not want to have anything to do 

7 with Ghorbanifar. 

8 Q But the U.S. Government had already been paid for 

9 those Hawk parts, right? 
10 A I don' t know. 

■Jl Q If we are talking about the Hawk parts that were 

12 delivered in May and then in the summer of '86, the U.S. 

■J3 Government had been paid, but Iran had not fully paid 

14 Ghorbanifar, who in turn had not fully repaid Khashoggi. So 

15 what would you have been doing with the money for the Hawk 
ie parts? 

17 A This is totally independent, or my understanding 

ig was totally independent of Ghorbanifar' s activities. 



Q Go on. 

A If you are suggesting that the Americans were going 
to get paid twice for the same thing, that I don't know, but 
that was not the understanding of the Iranians. The Iranians 
did not know that they had paid for it — 

Q Well, they hadn't paid. Ghorbanifar and Khashoggi 
had paid. 



723 



DNffJBSffffF^^^^/ 



^ . A With that group they didn't want to deal. 
2 Q You didn't discuss with the Iranians that it was 
2 Ghorbanifar and Khashoggi who were screaming for their money? 

^ A Absolutely not. This has nothing to do with that. 
There was a different occasion that I tried to convince the 
Iranians, not related to this agreement, to pay Ghorbanifar 
_ to keep his mouth shut so he would not becom3 a liability. 
That was a different effort, nothing to do with this. But 
this is — 

Q You gave me point 1. Let's go to point 2. 
A Point 2, nine working days after the first event 
the military supplies would be given to the Iranians. No, 
nine working days, 500 additional Tows and the Hawk parts, if 
Iran were to accept, together with the medicine that would be 
gift, will be delivered to Iran. 

Q So these were additional Hawk parts? 
A Yes. The total, I believe — the total number of 
Hawks that they were supposed to send to them was either 
2,500 or 2,000. We will get to that. 

Item 3, Albert will come up with a plan for the 
release of the 17 Kuwaitis prior to execution of item 4 
following 

Item 4, one and a half hostages — in parentheses, 
one definitely , two — the Iranians would exert their utmost 
to release the second one. And here it was -- this is the 



IINfiH^f^lHHkiHi^a 



/r -^ 



724 



■J issue that I earlier testified about. 

2 Q About the one and a half — one and a half meant 

3 that one definitely and two there was a 50-50 chance? 

^ A No, it is more specific than that. They would 

extert a lot of pressure and it refers now to release of the 

g American hostages from Lebanese, and there was a reason that 

-, they are referring here to Lebanese, because of the commitment 

g they had to the Lebcinese with regard to the 17 prisoners. 
Q But the reason -- what was the reason that you 

used the term half? 



A It says one, one-half — in parentheses, one 
definitely, two — they will do their . uo tin e s e , and insist — 
that is representing the half. 

Q Go on. 

A It is very important, the Iranians want to agree on 
one; the Americcuis wanted two. I came up with a solution -- 
why don't we cut in the middle just negotiating, and a half, 
and that is the way we are going. I explained item 4. 

Q Read it again. 

A That was item 4 has the one and a half. 

Item 5 refers to the method of payment for the 
future procurements of the Tow missiles and here it says, 
Albert emd — they refer to the relative — will come up with 
a solution based on establishing a letter of credit. By 
tomorrow night. And then there is a mark in here and a mark 



UNtUSlPtMc^ 



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''^%«t' 



in here, and I did sit down wi th ^^^^^l^H and we 
up with a solution as to how a letter of credit would be 
established, because we have had difficulty in operating the 
way we have been operating for payments. 

This is for 400 Tows and 100 launchers and has the 
deliver date, to be delivered four days after completion of 
item 4. And Iran will continue to pay the money for 1500 
Tows, and in parentheses they requests 1500 mines. To deliver 
500 plus 1,000 to be delivered later. 

And then it gives the time for the 1,000 to be nine 
days after the date shown above. 

Six, Americ2ms will provide technical and logistica! 
support for the Hawks. In parentheses parts — or materials 
rather -- and know-how, and updating their military intelligencje 
and the maps and esteUDlishment of a communication, special 
communications system between the two countries, a secure 
communication. And also providing them with the price and the 
time of delivery of an item -- of a list that was presented 
by^ — eight items, to the best of my recollection -- 
there were eight items that they wanted, different kinds of 
weapons and parts. 

Seven, before return of that gentleman to Tehran, 
there will be a discussion regarding the 17 prisoners and the 
method — the method that they would be released, and this 
method will be discussed with Secocda^because I told them that 



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I am not a politician, I don't know what in the hell is going 
on, I have to wait until Secord gets back. I am talking with 
him. And you see here marks, it comes down here and this is 
— it says after I talk to Secord and that gentleman regarding 
the Lebanese prisoners. 

We agreed on the verbage to be added to the same 
item in the seven points of Ollie. And the verbage is here. 
Item 8, Iran will start its efforts for creating 
the situation for release of all hostages — all hostages. 
It did not limit to Americans. 

Q To two — 

A To Americans. 

Q Not limited to Americams? 

A Not limited to Americans. 

Item 9, steps will be taken to deliver items 
stipulated in Article 6. And that was the nine points. 

Q Article 6 was of the — 

A Support eind parts — Article 6 — 

Q Was it Article 6 of North's proposal, which is 
Buckley's body — 

A Mo. 

Q Article 6 of North's proposal refers to things that 
are not in your points? 

A We eliminate all that. No, I am talking about 
Article 6 of this agreement. 

Q And is it signed? 



il 





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87 

o. 

^ A No. 

2 Q Is that the nine points? 

A Yes. 



'^^^'F/ea' 



3 

^ Q What did the nine points represent, an agreement or 
- a proposal? 

A This is what the Iranians agreed to do, and later - 

Q Who did they agree with? 

Who was it an agreement between? 

A This was prepared by this gentleman and I in the 
form of a proposal. It was completed after we put in there — 
there is another sheet that I don't know if I had that or not, 
that was the method that the 17 hostages, prisoners would be 
released, and then this was given to Richard as the new 
proposal and was passed on on the KL-43 to OlliCand Ollie came 
back and said accept it. So finally, this proposal was agreed 
between Ollie and this gentleman. 

Q Did North authorize you to negotiate this as a 
proposal on behalf of the U. S.? 

A He gave me his seven points. 

Q And he told you to see whether you could get them 
or something close to them? 

A Close to them, eind I came up with these nine points 

Q And you then submitted the nine points to North? 

A And he agreed. 

Q And the Iraniams understood you didn't have the 



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728 



iifi^mm 



1° If IWl.Ut\ VILMLMkC 1 SB 



T 



^ power to bind the U.S.? 
A Yes. 



•^%^ 



2 

2 Q I understand your prior testimoney to be that you 

> always made it clear that you were a private businessman in 
it for profit? 

A That is correct. 

Q And you were interested in opening the door to Iran 
not only for better relations but for coiranerce? 

A Correct. 

Q You then presented this proposal, which was your 
effort to get as much as you could of North's seven points to 
North, correct? 

A Right. 

Q And how soon after North got this on the KL-4 3 did 
he communicate back to you that it was accepted? 

A Right after — I would say within — I cannot recal 
exactly but within hours. 

Q And how did he communicate it, by KL-43? 

A By then Secord was there. I discussed with him the 
issue of the 17 prisoners amd added that to the nine points. 
He passed it on — from there on Richard was in contact with 
Ollie. 

Q Mr. HeUcim, did North tell you who he cleared this 
with? 

A I was under the impression he cleared it with the 





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President. 



lllWSif^ 



89 



Q Did North purport to have direct access to the 
President? 

A Yes. 

Q Did he tell you that he had cleared it with 
Poindexter as well or just the President? 

A My understanding was he had to^>«5 with both, tot he 
had to do it. 

Q He had to do it, meaning — 

A Oliver North, with Pointexter and the President. 

Q While we are on the subject of the President, did 
Oliver North ever tell you Wtat he had told the President of 
the United States that any of the money from the Iranian arms 
sales were going to support the contras? 

A My — I don't recall if he told me in those words, 
but it was well understood that this was a new source of funds 
for the contras. 

MR. JANIS: His question was did he tell you that 
he had told the President? 

THE WITNESS; I said he didn't tell me in those 
words, but he did tell me — he gave me the impression to 
believe that the President knew that this was a new source of 
supporting the contras. 

MR. JANIS: What did he say that gave you that 



impression? 



UNClASSIflHa^ 



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UNcmffii3i€7, 



90 



You don't mind if I try to — 



%^ 



MR. LIMAN: No. You have obviously gone over this 
with him and he has told you about this in the past, so it is 
helpful. 

THE WITNESS: He told me that — I am trying to 
remember whether he told me or Richard told me — that some of 
the Ayatollah's money was to be spent ^or the contras , that is 
the context — no, I remember now — Richard Secord told me, 
"Ollie is crazy. He has told the President that he is going 
to use the Ayatollah's money to support the contras.'' 

BY MR. LIMAN: 
Q And when did Richard Secord tell you that? 
A Mr. Liman, I honestly can't remember but I remember 
the fact that he said he is a genius or he is crazy, or both. 
He Waid words to the effect — I think he said both, he is 
either crazy or he is a genius. Many times he said either he 
would go to jail or become decorated. 

MR. JANIS: As best you can recall. 

THE WITNESS: The best I cem recall is ray under- 
standing was that he had told Richard that the President knows 
and Richard told me. . 

BY MR. JANIS: 
Q Now, after North told you that these had been 
accepted, what happened? 

A I believe -- if I don't have my dates again screwed 






ccin 

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up. — I believe the shipment of 500 Tows occurred after that. 
Q The 500 Tows were shipped — 

A When did they make the payment of the $5,600,000? 
Q That was one I believe in October. 

Since I can't read the Farsi date on the nine 
points — 

A I believe you have the date. I think that is what 
occurred after that. 

Q That the 500 took place. Were the nine points — 

MR. JANIS: Just a second. For the record, the 
money was paid on October 29, 1986. 

THE WITNESS: Do you know the date on the seven 
points? 

MR. JANIS: No, but the money was paid October 2 9th 
The money was paid by the Iranians on October 29th. 

THE WITNESS: It was cleared, went into the account 
or took a few weeks? After the 25th? 

MR. LIMAN: Lou, do you have the dates of the last 
500 Tows? 

MR. ZANAROI: It was November — 

MR. LIMAN: November 2. 

THE WITNESS: Here. You see this letter from the 
bank in German referring to the $3,600,000, October 24th. 
That is part of the deposition. 

MR. JANIS: That is Deposition Exhibit 7. 




USSIFIED 



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'^/£Z) 



THE WITNESS: That is either the day before that or 
the Seune day. I received the $3.6 million check. 
BY MR. LIMAN: 

Q Now — 

A And left it with the bank. Once it was cleared and 
we received the money in our account, that was when -- and we 
pcid the CIA, that was when the 500 Tows were shipped. So 
this — so the answer to your question is after the nine point: 
we shipped the 500 Tows. Item 1 was fulfilled without 
including the Hawk parts into it. 

Q Was the nine point proposal ever reduced to a 
written agreement signed by any representative of the U.S. 
and the Iranians? 

A Not when I was present. And I would find that 
very, very unusual for Ircuiians to put their signature down 
on a piece of paper at that time. There were subsequent 
meetings, by the way, to follow up on the other items of the 
nine points. 

Q And did you participate in those meetings? 

A Yes. 

Q And with whom? 

A The same group — Cave, North, iuid Richard, and the 
same group of Iraniems £md myself. This time I think it was ir 
Geneva. 

Q And do you recall when the last of those meetings 





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MMP'^s, 



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occurred? 



A If I am not mistaken, it was the last of those 
meetings was in late October. I believe it was in late 
October. 

Q Before the 500 Tows were shipped? 
(Counsel conferring with witness) 

THE WITNESS: I would like to correct myself. It 
must have — it must have happened by mid-November. 
BY MR. LIMAN: 

Q That was what I thought. 

And when was it that you were told to have nothing 
further to do with this initiative? 

A That was, I believe, in December, late December. 

Q And who told you that? 

A Cave . 

Q And — 

A That was in Frankfurt. 

Q And before that, did you meet with a representative 
of the State Department? 

A No. What happened, George Cave asked me — he said 
we are going to be out of this. There is one last request, 
and if I would be kind enough to arrange a meeting between the 
Iranians £md the State Department representative. I said I 
didn't mind doing that. I arranged for the meeting. 

Q The meeting with Engine? 




UNCLASSIFIED 
3! 



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^ . A Yes. And then by this time, everything was 

revealed — 

Q Wherfe did the meeting with Engine and the State 



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. Department take place? 

A When 

Q Where? 

A In Frankfurt. And I had ray attorney, Mr. Janis, 
with me 

Q Were you present at the meeting with the State 
Department and Engine? 

A I said I would participate only if I could have my 
attorney with me, and Mr. Dunbar did not accept that 

Q Dunbar of the State Department? 

A Of the State Department 

(Counsel conferring with witness) 

THE WITNESS: You do understand that he did not hav« 
objection for me to participate if my lawyer did not partici 
pate 

BY MR. LIMAN: 

Q He didn't want your lawyer to be present 

A Yes 

Q So you did not participate? 

A Directly I did not participate but the Iranians 
came back after the meeting and they had very, very unkind 
words to say about the capability and attitude of the State 



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Department. Which at one point needs to be discussed, in my 
opinion. 

Q Okay/ Mr. Hakim, when we talked about the 
pharmaceuticals, you were talking about the — these nine 
points and about the fact that they were going to be donated, 
and we have been through that this morning and this afternoon. 
Do you remember at one of your first meetings with the second 
channel in July of 1986, the subject of pharmaceuticals came 
up? 

A It is possible. 

Q Do you recall at that early stage talking about 
selling pharmaceuticals at cost or on a credit basis with a 
year to pay? 

A I think there is a mixup there. 

Q This would have been a meeting on July 11, 1986? 

MR. JANIS: Is there something you can show him to 
refresh his recollection? 

MR. LIMAN: I would be happy to except it is 
probably classified, and even though he was at the meeting. 
It was a meeting between you and a man by this name. What 
is a good code name for him? 

MR. JANIS: He was referred to earlier as Number 
One, wasn't he? 

THE WITNESS: Yes, you had his name. 



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BY MR. LIMAN: 

Q We talked eibout him earlier. He was Number One on 

a piece of paper I showed you. Do you recall a meeting 
between Number one and yourself on July 11, 1986? 

A I don't know what the document is that you are 

looking at. This has nothing to do with any of the channels. 
It has to do with" my initiative. This is what I started to 
to tell you earlier, that my approach was very different in 
approaching the Iranians. My approach was -- that has to do 
with these Telexes. That has to do with totally different 
segment of the Iranian network, which is based in, if I am 
not mistaken — where were these telexes from? 

See, this group, Mr. Liman, deals with all the 
military procurement of the — 

Q This group, meaning Number one? 

A No , no . 

MR. JANIS: The group referred to in the Telexes. 
BY MR. LIMAN: 

Q The group referred to in the Telexes which were 
marked as exhibits? 

A Yes. They have nothing to do with channel 1 or 
channel 2. 

Q But you somehow ended up talking to Number One 
■about it? 

A Yes. Person Number One and I started totally an 



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independent approach towards the Iranians, and that was to 

create a line of credit for them and sell them medicine at cost 

or even get donations an(J start 'a good will between the two 
countries . 



Was this a step by you in trying to get to channel 



2? 



And it ultimately led to chzuinel 2? 
Yes, exactly. 

And it led to the meeting ultimately with Engine? 
Exactly. But had nothing to do with part of the 
negotiation of the two formal delegations. 

Q I understand you, that you look upon the 
negotiations with channel 2 as being those negotiations that 
took place between the American delegation and Engine and you 
emd Engine, correct? 
A Right. 

MR. LIMAN: Can we ma*e a few minutes break? 
(A short recess was taken) 



!«iiL-' 



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MR. LIMAN: Okay, go ahead. 
EXAMINATION ON BEHALF OF THE SENATE SELECT COMMrtTEE 

BY MR. HOLMES: 
Q Mr. Hakim, my name is Cameron Holmes. I am 
going to be doing a little bit different method than what 
we have been doing in the past, and what I am going to do, 
what I am driving ab, so you will know in advance, is to 
develop the record primarily for the members. so that 
they can — this is our way of communicating to the 
members what evidence you have, so that when they question 
you, they will have a background. 

It is also a way of providing a record for 
the report that we are eventuallly going to be preparing, 
and I tell you that because some of the questions I will be 
asking you will be related to theories of the case or portions 
of the case that you may disagree with or not have knowledge 
of. I am testing those things against your knowledge so 
that we can either affirm or discard those types of things. 
A Okay. 

Q The first thing I would like to clarify because 
I, myself, was enlightened and I am sure that some of the 
members will be too, to have a little bit better picture 
of what it is that you talk about when you referred the 
other day to this important idea that you wanted to get 
across about the Iranian commercial thought process. 



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To refresh your recollection, it was in the 
context of one of the Iranians had mentioned to you in an 
aside that he wanted to get a message to the ^resident and 
you took him to mean that he wanted to make some side of 
side commercial transactions with the President, and you 
said that it is very important that we understand the 
tb^thought process, the method that this person was 
representing when he did that. 

Now is your opportunity to explain that in 
a block-by-block method so that we can lay that out. 

A Okay. This basically goes back to the upbringing 
of the people in that region of the world, Iranians included. 

As a child, when you bring them up, we don't 
communicate the way we communicate with our own kids here. 
As a baby, if you drink this water, I am going to give 
you this coffee, if you don't do that, you will be — I 
will do this. 

So, the structure of the mind as a child is that 
there is always a give and take, there is always a trade. 

Q I understand. 

A Okay . 

Q Go ahead. 

A So that is — if you put that together, but also 
with the other element that they believe in a central 
power. At home the facilitator is the central power in the 



mtmiu 



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family. In the government, in the previous regime, the 
Shah was. Now this could mean I — whether he has the 
power or not, that is irrelevant, but they like to relate to 
a central power. 

They see us in the seune way and manner, that 
we are prepared to give something in order to take something, 
and there is a central power in their eyes — the President — 
that can make the decision. He is the President. 

He is just like the Shah. They are not aware 
of our system and that causes a lot of unhappiness,and that 
was the point that I was trying to raise in my role, and that 
was to make the Americans understand that you — Iranians are 
what they are 

Q I gather this translates itself into patterns 
of commercial behavior that you find to be different than 
the traditional American pattersn of business behavior; 
would that be true? 

A That is true. 

Q How would you describe the Iranian patterns 
of business behavior that differ? 

A They are less sophisticated} they are more bottom 
line; they see what is in it for them; and they like to find 
out what is in it for the other party, and what they can 
do to get the most out of it. 

They are very basic. In particular in this 



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current generation of the Iranians who are all young people. 
That is it 

Q Let me test an idea against you and you tell me 
whether this is a fair depiction or not. 

I am told that in the Iranian procurement business, 
in other words, if I am a person with money in Iran that needs 
to buy something outside of Iran, then I would be less likely 
to have a filtering system comparable to, say, the Pentagon 
in ftie United States, filled with people who are relative 
experts on the subject, who can detetermine what is good 
and not good, what is a good price and what is not a good 
price, so that I would be likely to rely on personalities? 

A Very correct. 

Q And relying in that sense on personalities, I 
would look to a person that I knew and perhaps he can find 
somebody who was expert in the field that he trusted, and he 
might reach out to that person; would that be accurate to say? 

A That would be very correct. That is very clever 
observation, Mr. Holmes. In other words, the theory is not 
what you know, it is who you know? 

Q And there is an economic reason for that in that 
not having a middle class of experts but having a fair 
amount of money, at least in the days of good oil prices, 
and import of Western technology, and Western high-tech 
industry, I would be forced to rely on the people that I 

UMiSSlEIHfc^^ssiRED 



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That is correct. Trust plays an importa 



102 



nt role. 



Q I gather that that was the way that you made 
your business in the MCI days in that you had some expertise 
and you had the trust of people who needed that expertise 
desperately? 

A That is correct. 

Q And, thereforp, were ±)le to act as something of 
a guarantor of a deal, in other words, they would buy 
something on your representation that was a good deal and it 
was the proper equipment; you were personally responsible for 
that to happen? 

A That is correct. But it got to a point towards 
the end of the previous regime, it got to a point that a 
new class of people, small but still they were there, became 
into existence, that they started to follow the — what I call, 
what they knew rather than who they knew. 

They started to deal with substance themselves. 

Q So there was the beginning of a technocrat class. 

A Right. 

Q I bring this up by way of example, there was a 
law suit in vrtiich you testified in the Olin case which you 
have mentioned earlier in your deposition? 

A Yes. 

Q I gather that the way that those deals were 
structured in the Olin case would pretty much exemplify 



^ifmm 



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•4SD 



what we are talking about? 

A Very much so. 

Q You had contacts and they had contacts, and their 
contacts had procurement authority 

A Who is "they"? 

Q Their contacts would be the procurement authority. 
I can put it into specifics. You were working as an agent 
for Olin, right? 

A Olin and Winchester, two different divisions. 

Q Two different subdivisions 

A Dealt with two different parts. 

Q All right. And they were trying to sell ball 
powder plants? 

A That was Olin. 

Q In order to do that they had to convince oeople 
who had procurement authority of the merits of their 
offer? 

A Yes. 

Q And they ceune to you and you determined that there 
were certain people who had to be convinced of that in order 
to let the dealing through? 

A And then Olin wanted to make sure that I indeed 
had the contact and they put me to the test. If you read 
my deposition or the deposition of Mr. Castells, he says 
that when they came to the military industry they were 

M\ ASXtafiBSLASSlFlED, 
iiiiimi mitiiiiiiiHi' 



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«Na3l5SlflHP?r^, 



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^%: 



i"ij^ 



sitting there waiting for the code word that we ha"(T^ld them 
the night before that they would hear from this general, and 
that %iould give them the information that we had contact at 
that level. 

Q You say "contact," you mean that the general 
was looking for an financial benefit personally from the 
deal; right? 

A Oh, yes, 

Q And, in fact, an arrangement had been made in 
advance whereby the general was going to get money out of 
the Swiss account? 

A Swiss account or in that case, it was a German 
account. That is besides the point. The point was that 
01 in investigated to see who is the right agent for their 
purposes. 

They chose us because we were the agent for their 
Winchester division, and the reason we were the agent for their 
Winchester division was that the brother-in-law of the 
conmander of the Air Force at that time was sort of trans- 
ferred to my company. He had the agency effective of the 
Winchester division, and he was working with another group 
of people that had become there well known, the Lovneed 
brothers. It became a disaster, so the commander of the 
Air Force did not want his brother-in-law to have any further 
association with the Lovneed brothers, so he transferred his 



ims»fli»^^« 



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brother-in-law to me, and he said, okay, you look after his 
interests. 

Q Where the brother-in-law went, the business 
went; is that right? 

A Yes; he was a free lancer; he brought the agents 
with the business; he got his commission and he took care of 
whatever he had to take care of. That was the Winchester 
division. 

Q You passed the payment to the brother-in-law but--' 

A But what he did was it 

Q And he was obliged to pass it to the general? 

A If he did that ,or not, that is not relevant 
to the Olin case. I am trying to bring you to the Olin 
case which is different. 

Q All right, I was talking about the Olin case. 
Let's keep it there. I don't want to get 
confused with a lot of examples. I am trying to bring up one 
example where the players are known and where their roles 
are known, so that we can sort of see one model. 

A That is exactly what I am trying to do. 

Q Please. 

A I am saying the method is that when a company 
used to come to Iran to find a so-called agent, they try 
to see who, which agent has a good trac4 record. They go 
to the American Embassy, the consulate and the commercial 
division, they get the names of the agents and they go 



ss/nppi 



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through the list and they test them. 



^SIFIS> 



In the case of Olin, it was different, because 
we were already representing Winchester. They came to us, 
but still they wanted to test us. I am trying to get to the 
heart of the matter. 

So Olin said, now we know that you are strong in 
the Air Force. How do we know that you have strength in the 
mj-irir-industries? 

So we had to establish a code word with a key man 
in the military industry and tell this the night before their 
meeting with that official, to tell Olin people that tomorrow 
when you go there, when yoii are talking, you will hear this 
sentence, exactly this sentence. 

If you hear that, then you will know that we 
have talked to the fellow. So this is exactly what happened. 
They went there, they started to talk about their product, 
and all of a sudden, without any relevance, they say, 
oh, by the way, blank, blank, blank, blank; all that sentence. 

Q And read it off to them? 

A And they one back to us and said, okay, we are 
satisfied. You can do the job. 

Q Very much like the radio broadcaster that was used 
later on in the negotiations with the Iranians? 

A Exactly. By the way, if I may throw this thing 
in there, you might find it very interesting, that Bechtel 



747 



IINCHSSBW^* 



107 



%o 



[1 entered into an agreement with Olin for a brass mill, 
a joint venture in 1975-1976. You will find the date to 
be very interesting. And I was invited to San Francisco. 
I flew from, I bel^rve, Tehran or Geneva to San Francisco , 
and I spent a whole day, almost, cross-exeunined, to make sure 
that I had the contacts, also. And the lawyers, they had 
their lawyers, marketing people, everybody, to make sure that 
I had the contacts. And then they accepted to go into a joint 
venture with Olin so they could jointly sell this multi-million 
dollar brass mill. 

MR. LIMAN: Off the record. 
(Discussion off the record.) 






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'FIED 



MR. HOLMES: Back on the record. 
BY MR. HOLMES: 

Q You explained during the course of your testimony 
in the Olin case and then your lawyers explained for you the 
basic set up. I wonder if you could just strip it down to 
its essentials and tell us what the basic setup was, how the 
money flowed frcn Olin through you and to the people who 
needed to be paid? 

A Basically, Olin paid us and then 

Q "Us" was Multicorp? 

A No, no, we kept this all off shore. 

Q All right. 

A This was off shore. They paid us and then we 

Q Who is "us"? 

A Me, effectively me. 

Q All right. 

A Or if you will, the company that represented — 
I don't recall the details of it now because there were 
several payments. We used different companies. The 
money effectively C2une to me or the companies that I controlled 
and then there were secret accounts established for various 
interested parties, and as the money came into my account 
automatically it went to those accounts that belonged to the 
officials. 

Q So the money was transferred to your account 




749 



by Olin? 



URKIBSffm^ 



109 



A By Olin, yes. 

Q Then you transferred it to three different 
accounts? 

A I don't recall now the details of it. 

Q There was the .^■^■BM? roups, who was the 
general in the Air Force. 

A He was the military industry. He was an Air Force 
general, but he was the head of the military industries. 

Q And then there was another group — maybe it 
would be easier if we just refer to this document vrtiich I 
will mark as AH-21. 

(The following document was marked as Exhibit AH-21, 
for identification:} 

COMMITTEE INSERT 



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%/ 



BY MR. HOLMES: 
Q You had a lot of discussions during this course 
of time with your lawyers? In fact, there was Mr. Rice and 
Mr. Gooding who received payments out of your Swiss 
accounts in this case? 

A But that had nothing to do with this. 
Q It wasn't this case they were representing you 
on? 

A No, not at all. This goes way back — you see 
I got intoAis as the government witness. 

Q They represented you in January of 1984? 
A I can't remember those dates, Mr. Holmes. If you 
would just show me the documents. 

Q I am just getting a document. 
MR. JANIS: Do we have that? 

MR. HOLMES: I don't have extras with me, but you 
can have a copy. 

BY MR. HOLMES: 
Q They filed a motion on your behalf in that case; 
didn't they? 

This is now marloed. Exhibit 21. 
MR. JANIS: Do you intend to ask. questions 
about this document? 

MR. HOLMES: NO; I just want a simple clarification 
of what it was, and I just want to get it in the record, and 






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go on. 

MR. JANIS: What is in the document? 

!•«. HOLMES: This explains clearly what Mr. Hakim's 
position was and what the facts were about ^e flow of 
payments. 

THE WITNESS: I explained that to you, and it 
came to me and from me to the interested parties. 

MR. HOLMES: I know. I just want you to look at 
this. 

MR. JANIS: Have you seen this document before: 

THE WITNESS: I can't remember. 

MR. HOLMES: This is only a couple years ago; 
he will probably recognize it. It was based on your 
explanations of what that case involved. 

THE WITNESS: You are assuming that everything 
that happened a couple of years ago, and if you go through 
what I have been doing during the past two years, you 
can readily understand that I have all the reasons to forget 
ev«rything about Olin and concentrate on Iran, and contras. 

So, really it is a wrong assumption that because 
it was a couple of years ago, I remember. 

BY MR. HOLMES: 

Q Well, I guess we can go through, it, but it would be 
easier'--'- 

A You want me to go over this? 



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MR. LIMAM: What are the facts that you want him 
to testify to? 

MR. JANIS: The problem is you have a document 
here which we don't have a copy of, and which he hasn't 
seen before. If you want him to take the time and read it, 
he can do that. 

MR. LIMAN: I don't want to take the time at this 
time. There are some facts that Kip wants to put in the 
record. 

Just summarize what it is. 
BY MR. HOLMES: 
Q You were paid by Olin; right 
A Yes, 

Q And you had three different groups of people 
that needed to get paid off in order to get the contact? 

A If this is your information, I have to rely 
on your information. I don't recall it at this time. 
Q It is your testimony? 

A Fine. You want me to read my testimony, I will 
be more than happy to read it, but now I have to rely, 
because you have done your homework, I haven't. I have 
to rely on what you tell me. So we are back to the scune 
thing. 

You want me to read this document? 




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You had bearer letters, didn't yft^^in 



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that 



I recall something to that effect. 

And there were three bearer letters, one to 

and the Air Force group? 
If this is what I testified then, then that is 



case? 

A 

Q 
pay offj 

A 
correct . 

Q One of those people was a general who didn't 
want to get his money right then, he wanted it later; 
right? 

A I don't recall the case now. 

EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE 
BY MR. LIMAN: 

Q It would not be unusual for you to park money 
for someone if you did business in Iran? 

A If they trust me. 

Q If they trusted you, you would park it; 
is that correct? 

A Sure , 

Q Because if you sent money to someone in Iran, 
that would create complications for the person; correct? 

A Yes. 

Q You could hold money for someone if they trusted 
you and then pay it to them at a later date? 

A In Iran that was customary, yes. 



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Q All right. '^^^ 

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BY MF. HOLMES: 

Q And it was General^^lMIIBK. is that — 

A Yes. 

Q And he wanted his later? 

A Yes. 

Q You had Mr. Castells open an account in 
Mr. Castells' naune? 

A I think that was one of the methods I used, 
yes. 

Q Then you put the General ' s money in the 
Castells' account? 

A Yes. 

Q And promised Castells the interest for holding 
it for you? 

A I recall something to that effect. 

Q Then you designed what you call a bearer 
letter that was an instruction to Zucher to pay the 
bearer the contents of the account? 

A I don't know whether it was an instruction to 
Zucher. There you might be wrong. It had to be to the 
bank. 

Q Well, to the bank, then. 

A Yes. 

Q And the bearer letter signified that the bearer 



was entitled to the contents? 



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If that document says that, then 



I have'^^Q 



116 



on it. 

Mr. Holmes, that document that you are showing 
me and you are telling me is dated '84, that refers to a 
transaction that happened in '75 or '76. 
Q I understand. 

A You are asking me to remember what happened more 
than 10 years ago. 

Q I am asking you what your attorney represented 
on your behalf in January of '84. 
In any event — 

MR. JANIS: With all due respect, I am not sure 
what this says. 

MR. LIMAN: He is showing a pattern of doing 
business and I think he will acknowledge that that is not 
an unusual pattern of doing business. 

THE WITNESS: Mr. Liman, I have no problem 
if you get to the bottom line and establish a pattern of 
business. When you bring up dates of 11 years ago, that 
puts a lot of strain on me. If you go to the point and 
say if this is a pattern, I would be more than happy to 
openly, as I have shown it so far, to answer the question. 
We don't need to build up towards us; let's go to the 
point. 



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^S 



BY MR. HOLMES: 



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Q The point is that in the '70s, you made your 
business by obtaining contracts with the Iranian governnent, 
government agencies by paying off government officials. 
True? 

A Yes. 

Q And you did that through Swiss and offshore 
accounts? 

A Yes. 

Q And you did that through the use of bearer 
letters so-called? 

A Yes, and — 

MR. JANIS: That is also, I think Mr. Hakim 
is being too willing to cooperate. I don't think that 
is accurate to the extent that you imply that is the only 
way he made his business. I think he has testified at some 
length about his businesses. 

If you are asking whether as one component of 
his business practices in Iran, he made payments to 
government officials, he has admitted that that is correct, 
and we are all aware there was a different atmosphere at 
that time than there is in the United States. 

MR. HOLMES: I'm not worried about a different 
view of the world in that part of the world. I'm 
establishing that is the case. 



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118 



THE WITNESS: Can we go on the record atwfc^my 



-ypl 



dealings with Hewlett-Packard. Hewlett-Packard, not one 
penny was paid off to a government official when we did 
business with Hewlett-Packard, You are trying to establish 
a pattern. I wanted to be educational, noc just to serve 
your purposes. 

BY MR. HOLMES: 
Q Right. 

A So while you are putting in there Olin, let's 
put also Hewlett-Packard. 

Q I don't want to spend time with this further. 
A Then let's go on the record. 

MR. JANIS: Wait until there is a question. 
THE WITNESS: While I was in Iran, I did this 
and did business the way it was done in Iran. That should 
also be educational for the purpose of the representatives. 
BY MR. HOLMES: 
Q Good. Thank you. 

You did business with a project called IBEX, 
isn't that right? 

A No, that is wrong. 

Q You never did business with IBEX? 

A No, sir. 

Q Did you do business in the computer business 



in Iran in the '70s? 



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Compute 



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A Computer is a very broad term. Computer for 
what purpose? 

Q Any computer . 

A Yes. 

Q You exported computer hardware from the United 

States to Iran? 

A I didn't. 

Q Did any firm that you were associated with? 

A Yes. 

Q Which firm? 

A Hewlett-Packard, for example. 

Q Were there others? 

A Yes. 

Q Which? 

A Texas Instruments . 

Q Any others? 

A Yes. 

Q Which? 

A Stanford Technology. 

That is the same Stanford Technology we were 
talking about earlier? 

A We talked about two Stanford Technologies 

earlier. Which one? 

Q This is the one in California. 

A Yes. 




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" Q Did you export equipment that was sulCQle for 



surveillance support? 

A What is your interpretation of surveillance -- 
of what? 

Electronic surveillance. 

A The only thing that I can recall that relates 
in any way or form to the question that you are asking is 
the receiving station, the monitoring station that I already 
have testified to. 

Q What it received and monitored was phone calls? 

A Yes. 

Q And the computer equipment was necessary to 
cross-relate the phone calls and the phone numbers? 

A Yes. 

Q And how was that equipment exported; when and 
under what name? 

A I have no idea. 

Q You have no idea? 

A No, sir, because I did not run Stanford 
Technology. George Hoberg did. He would be the person 
to answer the question. He was the president of the company 
then. 

Q You didn't have any contacts in Iran with 
regard to the export of this computer equipment? 

A I had contact in Iran with the import of this . 



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IIN()BBSfiHI^<^M5. 



121 



^'Pieo 



1 had nothing to do with the export of it. Export was done 
in the United States by the company in the United States. 

Q So your job was the import side in Iran? 

A Yes. 

Q What was your role? 

A The agent of Stanford Technology like I was the 
agent of Olin and the agent of Hewlett-Packard. 

Q This equipment was being purchased by the 
Air Force, is that correct? 

A That is correct. 

Q 

A No , wrong . 

Q Who? 

A I don't remember -- what date was this? You 
want to know who was the commander of the Air Force at 
that time? 

Q Who were the people in the procurement chain who 
had to pass on that contract? 

MR. JANIS: We are in an area here where if 
yoo start identifying people, I think — 

MR. LIMAN: You don't have to identify people 
on this record if you feel that would be better put on a 
piece of paper. If they are not related to people in this 
particular matter — 

THE WITNESS: Not only that those people are 



762 



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122 



1 either in Iran or just came out of jail, and I am not 

2 going on record and have them shot. 

3 BY MR. HOLMES: 

4 Q ^^HflBHHIMBB had something to do with this? 

5 A No. 

6 Q Did Eric Von Marbad? 

7 A No. 

8 Q Did you ever speak with Eric Von Marbad? 

9 A No. 

10 Q Who in the United States Government did you 

11 interface with in the sale of this computer equipment? 

12 A I have already testified that in the United 

13 States I played no role. 

14 Q No, in the United States Government -- I'm 

15 talking mostly about Iran, people who were in Iran as 

16 U.S. Government representatives. 

17 A I understand. The companies that were my 

I 

18 principals hadnled that portion of it. I had nothingto 

19 do in the United States. I was an Iranian — 

20 Q My question is, what United States Government 

21 representative had procurement authority over these 

22 particular contracts, or oversight authority? 

23 A I have no knowledge about this . 

24 THE WITNESS: Is there an outstanding question? 

25 (The reporter read the record as requested.) 



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,, 123 



THE WITNESS: I answered the question. 
BY MR. HOLMES: 
Q Did you have other electronics-related contracts 
in Iran at the Scune time? 
A Yes. 

Q I eim talking about '75 to '78. 
A Yes. 

Q What were they? 
A I don't remember now. 

Q Did you have any relationship whatsoever with 
the project ongoing at that time to mount long-range 
cameras in airborne surveillance units? 
A What was that again? Sorry. 

Q Did you have any relationship whatsoever with a 
project ongoing at that time to mount long-range c2uneras 
in airborne surveillance units? 
A No. 

Q This would have been a computer imaging problem, 
would it not, reconstruction of the photographs obtained by 
long-range cameras? 

MR. JANIS: Can we take a break? I would like 
to take a break. 

(Counsel confers with witness.) 
(The reporter read the record as requested.) 
THE WITNESS: I have no knowledge of such a 



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UNttiASSIfi^ 



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proiect, as I recall. 

BY MR. HOLMES: 
Q Did you or Stanford Technology import signal- 
processing technology into Iran during that period of 
years, '75 through '78? 

A What was the date again? 
Q '75 through '78. 

A I recall vaguely that Stanford Technology sold 
some image-processing systems to Iran. I don't remember 
the date. 

MR. LIMAN: After or before the Shah? 
THE WITNESS: It was before. I left Iran way 
before the Shah's fall. 
BY MR. HOLMES: 
Q You testified about a contact with General 
Secord while you were in Iran. Did he have any procurement 
authority over any other project that you had ongoing in 
Iran other than the one you have already testified about? 
MR. JANIS: To the best of your recollection. 
THE WITNESS: First of all, I don't recall that 
I testified that he had procurement authority. To the 
best of my knowledge, he did not have procurement authority. 
He was in an advisory capacity. 
BY MR. HOLMES: 
Q Let me expand my question to include any 



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advisory capacity. 



-^S^^f. 



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A No. Then the answer is no, to the best of my 
recollection. I do not remember any project in the Air 
Force — 

Q I didn't ask projects in the Air Force; I asked 
about any project that you had anything to do with in 
Iran. 

A General Secord's advisory capacity was only with 
the Air Force. He was assigned to the Iranian Air Force. 

Q Let me ask the question, did General Secord have 
any authority at all, advisory or otherwise, over any 
project that you ever bid or attempted to bid on in Iran? 
MR. JANIS: If you know. 
THE WITNESS: I can't recall. 
BY MR. HOLMES: 

Q Were you — 

A To the best of my recollection, that could not 
be the case. 

Q You testified — well, let me see — do you know 
an individual named. 

4tttH^ yes. 

Q When did you first meet him? 

A If I'm not mistaken, 1984 or sometime about 
then, '84-'85 -- I don't remember exactly. 

Q How did you come to meet him? 



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m 



A Through General Secord. 

Q . General Secord invited you to meet with| 

A He arranged for us to meet . 

Q And when you met, who was there? 

A You mean the first time? 

Q Yes. 

A I can't remember. 

Q Where was the meeting? 

A Possibly in California, but I don't remember. 

Q Had there been some negotiations prior to the 
meeting about the formation of a company called IDG? 

A To the best of ray recollection, IDG has been 
a company in existence for a long time and belonged to 

I am not aware of the details of it, but at 
least that is how it was represented to me, that IDG 
belonged ^^ ^BHJHHMHKii^ ^nd his family, and was in 
existence for a long time. 

MR. JANIS: Do you have anything that you could 
show him that would refresh his recollection, Mr. Holmes? 
MR. HOLMES: I will when I get to it. 
BY MR. HOLMES: 

Q You at that time were operating under STTGI , 
is that correct? 

A Which date? 

Q The date of this — 



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127 



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kzed in 



A If it was after '83, yes. STTGI was ere' 
early '83. 

Q What was the negotiation between yourself, 
yourself and Mr. 

A Mr.^flHjjptwas to the best of my recollection 
interested in us bidding for a security project in Saudi 
Arabia. 

Q What security project was that? 
A For the Saudi government, I believe for the 
Air Force or air defense. I don't recall which one now. 

Q I'm handing what is marked as AH-22, a document 
entitled "Marketing Consultancy Agreement." Turn to page 
STG-11128, and I ask you if that is your signature on 
page numbered 2 of this signature section. 

(Exhibit No. AH-22 was marked 
for identification.) 
MR. JANIS: Do you have another copy of 
that document? 

MR. HOLMES: No. 

MR. JANIS: Could somebody make a note, please, 
to get us Deposition Exhibits 21 and 22? 

MR. HOLMES: We will get them all for you. 
THE WITNESS: Yes, this appears to be my 
signature . 

MR. JANIS: I guess we will have to take the 

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time to read this, then. 

MR. HCLMES: I haven't asked him any 
questions . 

MR. LIMAN: You don't have to take the time to 
read it. 

MR. JANIS: You have no questions about this 
dcoument? 

BY MR. HOLMES: 
Q You and Mr. Secord and Mr. Robert Lilac met 

(2^ 



DeJof '83, 



in Decembeqof '83, is that correct, in San Mat^o, 
California, at the offices, of IDG? 

A I remember having had a meeting where Mr. Lilac 
participated. I don't remember the date. 

Q You knew Mr. Lilac to be a personal friend of 
^^Jis that correct? 

A In '83, you mean? 

Q Yes. 

A I don ' t remember . 

Mr. Lilac worked subsequently for STTGI as a 
consultant, didn't he? 

A To the best of my recollection, he worked for 
Marvais as a consultant. 

Q He worked out of the STTGI office and was paid 
by STTGI as a consultant? 

A For the Marvais ore 



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Q That was the only large project that STTGI 
was working on in the Middle East? 

A In the United Arab Emirates, yes. 

Q And at the timepf the meeting in San Matao, 
the focal point of the discussion was trying to get 
Marvais as a client with IDG jointly with STTGI? 

A There was some effort, to the best of ray 
recollection, to create some sort of a joint venture — 
I don't know whether it was with STTGI or STC, with 
regard to the requirement in the Middle East. I don't 
remember which country it was related to. 

Q Your negotiations with Hr . JtBttr centered on 
i r^^^^^^^^^^^Hc o r r e c t ? 

A Yes. My business negotiations ceftitered in 
connection with the security project that I mentioned in 



Q And you wanted also to expand the possibility 
of getting jobs for Marvais ir 

A I did not participate in those meetings. 
Marvais participated directly. 

Q You were aware of some meetings but you didn ' t 
participate in them? 

A I knew that they had meetings between the two 
companies but I did not participate. 

Q You were aware at the time of your meeting 



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/ED 



in San 



with General Secord about Lilac and Mr, 

Mat^o that General Secord was closely associated with 

is that right? 

A I don't know whether he was closely associated 
with^^^^^^^^^^^Bbut I know that he was closely associated 
with the project, and I was aware that he managed and 
handled that project. 

Q He being Secord? 

A Secord. 

Q You were aware that^^^^^Hwas handling the 
ir^^^^^^^^^^Hweren ' t 

A I was not aware of that. 

Q Was there any discussion whatsoever in your 
conversations with Mr . ^||||||||^about the possibility that 

rfould provide emy moneys to any insurgencies , 
anti-communist movements zmywhere around the world? 

A I had no participation in such meetings as far 
as I can remember. 

Q Are you saying that there may have been such 
meetings that you didn't participate in or not? 

A I said I do not recall having participated in 
such meetings, and if there were meetings that I did not 
participate, I don't recall of those meetings either. 

Q Did you ever discuss with Mr. Secord the 
possibility that if you went into business with Mr. 



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IIIWfflBP^i2«D 



131 



that there would be some benefit fromi 

Ithat would flow to any ant i- communist movement 
in the world? 

A I had no meeting that I can recall that had any 
taste, smell or odor of politics related to General Secord 



Q Do you recall any discussion with Mr. Secord -- 
is the answer no to my question then? 
A Yes. 

MR. JANIS; I think he has answered the question. 
Next question. 

BY MR. HOLMES: 
Q Did you ever discuss with Mr. Secord during 
that period of time, late '83, the potential of Mr. 
Secord 's involvement in any ant i -communist action? 
A I don't recall such a thing. 
Q Do you recall in about December of 1983 any 
discussions with Mr. Secord about any activities in 
Central America? 

MR. JANIS: In December of '83? 
MR. HOLMES: Yes. 

THE WITNESS: Not that I can remember. 
BY MR. HOLMES: 
Q What became of your negotiations with 



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"A In connection with Mr. -- the only negotiation -- 
the only negotiation that I had with ^^ •^^Ktj^ ^^ I 
testified that I can recall had to do with the security 

f or ^^^^^^^^^^^^^^^^^^and to the my 
recollection, ^^ •J^jttKttti^' ^^^ representation of who 
he was and what he could do turned out not to be correct, 
and nothing came out of it except loss for our company. 

Q Could you explain what you mean by that? You 
are saying that he represented that he had a lot of 
business strer 

A ^^ 

I He had a business relationship with them. They 
were in his pocket. Khashoggi was in his pocket. He 
mentioned all kinds of names and made all kinds of repre- 
sentations, and we didn't get the project and the project 
was given to another company and we were out of pocket 
thousands of dollars for making a bid. 

Q We are not throwing stones at Mr. -- I gather 
from what you are saying, your tone of voice, that you 
are feeling that he didn't deliver? 

A I said that I was a principle of Stanford 
Technology, I knew how business was run in the Middle 
East. I asked ^^ •y^KK//tt0^ ^^ ^^ could pay off and 
if he had the capability; he said he did and he didn't 
deliver. I am consistent with my testimony. 




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fPlED 



1 Q So the agreement under negotiation was that he 

2 would pay off and the ultimate outcome was that he wasn't 

3 able to? 

4 A Well ,^^^^^^^^^^^^^^Bl learned that things were 

5 done even in a more weird way than Iran. I learned that 

6 the same agent who make deals with a number of principles 

7 and they submit for the same bid different proposals from 

8 different companies, and they sit back and do nothing, and 

9 whoever wins, they get their commission. And this is 

10 exactly what happened, I learned -- this is exactly what 

11 happened in our case. 

12 Q Were you asked at one point to submit a high 

13 bid by ^^ -^flflMP^^ group on your project? 

14 A I really don't remember, but he was engaged in -- 

15 what I can recall, he led us to give a price that caused 
1g us to lose and another company to win. This is what I can 

17 recall. 

18 Q Your bid was too high? 

19 A No. There were higher bids than ours, there 

20 were much higher bids than ours. We were right in the 

21 middle, but they were much lower bids that got the 

22 project. 

23 Q Did he tell you at one point that you didn't 

24 have the strength to make this particular bid go to 

25 STTGI but if you went ahead and went along with this bid 



ilHASSlflEBLNCLASSIFlED 



774 



134 



1 by bidding high and bidding yourself out, he would see 

2 he could get benefit back to you in the process of other 

3 bidding? 

4 A He didn't have such a discussion with me. I was 

5 representing the STC and not STTGI . If you look at this, 

6 you see I signed as STC. 

7 Q This is Exhibit 22, an agreement bewteen Stanford 

8 Technology Trading Group International and IDG, and you are 

9 saying that you signed as STC? 

10 A Stanford Technology Corporation. 

11 Q I see three signature lines here. The first one 

12 is Albert Hakim. 

13 A As an individual . 

14 Q The second one is Richard Secord as an individual 

15 and the third is Stanford Technology Trading Company 
15 by Albert Hakim. You and Secord were the two partners 
17 in STTGI . 

13 MR. JANIS: The document just says Stanford 

19 Technology Corporation. 

20 MR. HOLMES: That is what I said. Referring 

21 to STG-11128, it is Albert Hakim personally, Richard 

22 Secord personally, and Stanford Technology Corporation 

23 by Albert Hakim as president. You and Secord were the 

24 two partners in STTGI, weren't you? 

25 THE WITNESS: I don't know. That is what I am 



lUICLASSm 



^£l-ASSlFlEn^ 



775 



21 



saying . 



lINEBRSItllET 



135 



1 

2 MR. LIMAN: This is an agreement with STTGI , 

3 and what Mr. Holmes is asking you is that since it is 

4 dated after STTGI was formed and after Mr. Secord became 

5 your partner, didn't both partners of STTGI sign this? 

6 THE WITNESS: Mr. Liman, I'm saying STTGI was 

7 formed without Mr. Secord being a partner. 

8 MR. LIMAN: But he signed this — 

9 THE WITNESS: As an individual. 

10 MR. JANIS: What is the date of the document? 

11 Is there a date on it? 

12 MR. HOLMES: It is well after the formation 

13 of STTGI. 

14 THE WITNESS: When did Secord become a partner 

15 in STTGI? That is the date that I'm trying to establish. 

16 BY MR. HOLMES: 

17 Q It was before you even met Mr^^jjBH^ by 

18 your testimony. That was in May of '83. This is almost 

19 a year later, January of '84. 

20 A So then my question is, if the contract is 

21 between STTGI and IDG, why did Stanford Technology 

22 Corporation sign? 

23 MR. LIMAN: It says an affiliate of STTGI 

24 shall mean Albert Hakim, Richard Secord and Stanford 

25 Technology Corporation, and there are various references 

IClASSIElEfccussTO 



776 



Uim^EDi;, 



136 



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5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

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16 

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22 

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24 

25 



^SIFIS) 



here. Let's see if there are any guarantees — it says 
the agreement is binding on the shareholders, officers and 
irectors of the parties and its affiliated companies. 

THE WITNESS: Here is the — 

MR. LIMAN: STTGI is signed for by Richard 
Secord as president and by you as chaii...ian of the board 
of directors and the date of the agreements seems to be 
January 27, 1984. 

THE WITNESS: Okay. This is different. That 
is why I am saying, that is an exhibit — that is why we 
got confused. 

MR. LIMAN: We have established that this was 
January 27, 1984, and it was signed by Mr. Secord and 
Hakim on behalf of STTGI and the agreement of purchase — 

MR. JANIS: In other words, we were looking 
at the wrong signature page before, is that correct? 

MR. LIMAN: Yes. And the agreement of purchase, 
which is the exhibit to it, refers to the board of 
directors of STTGI consisting of Mr. Hakim and Mr. Secord, 
and it requires the approval of 75 percent of the holders of 
the shares , and that happens to be signed by also STTGI 
and then there is a noncircumvention agreement, and that is 
the one that deals with Mr. Hakim and Stanford Technology. 

THE WITNESS: That is why I got confused, 
because I couldn't understand the relevance. 



limiASSIBffi^^™ 



777 



23 



iiiffia88tft»«^cus5„"' 



BY MR. HOLMES: 

Q Are you familiar with the name Hyde Park Square? 

A The Pancunanian company? 

Q According to AH No. 8, your chart diagraun, 
Hyde Park Square Corporation is marked down under Middle 
East with a designation E. 

A Yes, sir. 

Q When was Hyde Park Square Corporation formed? 
I'm not asking for an exact date. I'm talking about in 
relative terms. 

A I don't remember;, to the best of my recollection, 
it was an off-the-shelf company that existed in CSF, and 
we took it and used it. I don't know when they had 
incorporated that company. 

MR. JANIS: For the record, Mr. Hakim has provided 
the committees with the appropriate corporate papers 
regarding the formation of Hyde Park. 
BY MR. HOLMES: 

Q What was your understamding of what it meant, 
what Hyde Park Square meant? Does it mean anything? Was 
it related to anything-? 

A No, it had no significance to me. 

Q You didn't participate in the selection of 
that name in any sense? 

MR. JANIS: If. you know. 




778 



24 



ulHftaBllB^c 



138 



^^^ss^fm 



1 ' THE WITNESS: As far as I recall, I had no 

2 participation in choosing the neime, and as far as I recall, 

3 even though if the company was incorporated, when I needed 
^ it. As far as I recall, it is possible that the company 

5 was incorporated even prior to my using it. 

6 BY MR. HOLMES: 

7 Q Did you ever discuss with anybody the original 

8 intention for which Hyde Park Square was incorporated? 

9 A As far as I recall, no. 

10 Q So it came to you as an off-the-shelf corporation 

11 with no history? 

12 MR. JANIS: He said he wasn't sure whether it 

13 came as an off-the-shelf corporation. 

14 BY MR. HOLMES: 

15 Q I am asking for the best of his recollection. 

16 A The best of my recollection, as I testified, 

17 I believe it was a company that was off the shelf. I 

18 don't recall at this time if I participated in causing 

19 it to be formed. 

20 Q What was the first time you recall using the 

21 Hyde Park Square designation? I see that it is on the 

22 Exhibit No. 8, so I gather it was uppermost in your mind 

23 as one of the Treasury companies when you did the diagram. 

24 A The best way to answer your question is to 

25 refer to documents that I have already submitted to the 



779 





1^ 



139 



<^^, 



% 



% 



comniittees and get the dates. 

Q Let me submit the dates. 

When was this Exhibit No. 8 created? 

A It must have been some time in the summer of 
'86. 

Q What caused the creation of Exhibit No. 8, 
reorganization? 

A I was trying to bring discipline in the chaotic 
way that we were operating. 

Q So what day or week or month, if that is as 
close as you can get, would that have happened? 

A I am unable to answer that question. I can't 
remember . 

Q Was it at the same time as your reorganization 
is; in other words, was it all of a piece with other 
reorganizational things that you were doing? Would it be 
dated with other things of the same type? 

A I don't remember, Mr. Holmes. 

Q I'm wondering, for example, about the creation 
of the Button account on May the 20th of '86. Would it 
have been about the same time as that? 

A I have really no recollection. I cannot 
remember this. As I said, if one should refer to the 
bank records related to Hyde Park, you should be able to 



get the information. 



lEUSSlfl^™ 



780 



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3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

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18 

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25 



UNtlA^ttii;^ 



140 



^^%A 



a7*cc 



JANIS: to move this along, the Button aTJcount 
was funded" on May 20, 1986, and he has testified that this 
chart was created in the summer of '86, when Mr. Zucher's 
son was working for CSF. 
BY MR. HOLMES: 
Q Was Mr. Zucher's son already a summer employee 
by the end of May, or do you recall? 

A I don't recall, but he helped me to prepare 
this. That is why I made the guess of summer, because -- 
Q Please look at Exhibit No. 23. 

(Deposition Exhibit No. AH-23 
was marked for identification.) 
MR. JANIS: This is a document produced by 
Mr. Hakim, H-186. H-186, H-187 -- well, it is H-186, I 
take it, through H-191. 
BY MR. HOLMES: 
Q Mr. Hakim, on page H-188, is that your 
signature? 

A It appears to be my signature. 

Q That particular document is dated May 20, 1986, 
is it not? 

A Yes. 

Q And that is when you added your name to the 
signature on that account, is that right, along with 



Mr. Farina and Mr. Zucher? 



^d\fflUS8P* 



SIFIED^ 



781 



27 



end emm 






141 



A It appears so. ^Z^ 



'^Sa 



% 



7 
8 
9 
10 
11 
12 
13 
14 
15 
16 
17 
18 
19 
20 
21 
22 
23 
24 
25 



UNCLASSIFIED 



782 



BOYUM/bap #8 

4:15 
8-1 



1 
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7 
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iiim 



^M)4M:ir^i 



JUirTCtr'Qxi^ 



%0 

lly sTgr 



142 



Q Do you have any recollection of actually signing 
that document on May the 20th or could that be a document 
that was signed at a later date at Mr. Zucker's request? 

A To the best of my recollection, I testified 
that I signed this document at ray request. 

MR. JANIS: Excuse me, other documents included 
in this exhibit indicate that an account was opened in 
March, March 14 of 1986, in which Mr. Hakim is listed as 
the principal — 

MR. HOLMES: Why don't we ask one question and 
get an amswer at a time amd move it along. 

MR. JANIS: On March 14, 1986. 

I don't think this is accurate. I also don't 
understand the relevance of it. 

MR. HOLMES: This document, 190, doesn't give 
him signature authority. Does document H-190 give you 
signature authority on that account? 

MR. JANIS: Excuse me — 

MR. HOLMES: I am asking the witness. 

MR. JANIS: Your original question was when the 

\fJAS 

accounts were opened. This ! * > >■ » on March 14. 

MR, HOLMES: That wasn't my question. 

MR. LIMAN: I think the question is whether he 
signed the document on or about the date that appears , 
and there was no answer to the 



m 




,s\^\^- 



783 




> . MR, JANIS: The original line of questioning was 

2 when this was created. 

3 MR. LIMAN: Why don't we get an answer to the 

4 question Mr. Holmes asked. He showed him his signature and 

5 he wants to know whether it is back-dated or signed on that 

6 date. 

7 MR. HOLMES: Did you design this document on May so 

8 as it is dated, or could this have been signed at a later 

9 date? 

10 THE WITNESS: I can't remember. 

11 BY MR. HOLMES: 

12 Q Did you sign documents of this type, not 

13 necessarily relating to Hyde Park, but documents of this 

14 type that were not being signed on the date that was on 

15 the document? 

16 AX cannot recall. 

17 Q You have testified that Mr. Zucker appeared at 

18 your hotel in November 1986 with a large stack of 

19 documents for your signature? 

20 A Yes. 

21 Q Documents that were sign or authority documents 

22 lilte this H-188 at that time? 

23 A To the best of my recollection this was not part 

24 of those set of documents and to the best of my recollection 

25 the documents that he brought to my hotel had to do with. 



UNBU&iySiP 



CLASSIFIED 



784 



nss^gs^' 



"^^SSiF, 



'ED 



144 



1 not bank accounts, but the companies that were created, 

2 sort of fiduciary agreements. 

3 Q How many documents were there in total? 

4 A I can't remember, probably as many as the 

5 companies that we had. 

6 Q How many were there approximately? 

7 A Just looking at this chart here, Exhibit Number 

8 8, I can see, 1, 2, 3, 4, 5 — well, no, this is not 

9 correct. This was never formed — 1, 2, 3, 4, 5, 6, 7, 

10 companies I see here, and there were a few other companies 

11 that I have already mentioned and given you documents and 

12 testified that doesn't appear on this chart. 

13 Q Did he give you a total then of not more than 

14 a dozen documents to sign? 

15 MR. JANIS: If you can recall. 

16 THE WITNESS: I can't recall. 

17 BY MR. HOLMES: 

18 Q I am trying to get a ball park figure. You 

19 testified earlier you had a large stack that could have been 

20 SB large as hundreds of pages. 

21 A I don't believe it was hundreds of pages. 

22 Q How many pages was it approximately? How many 

23 times did you sign? 

24 A I can't remember, Mr. Holmes. 

25 < 



I am asking for. your best approximation. Was it 



|||^S£[gy^cu5Sin 



785 



mmi\!!F' 



a,s 



more than a dozen? More than a hundred? 



%fC 



145 



1 

2 A Not more than a hundred, and I don't believe 

3 more than a dozen. I can't recall. 

4 Q Can you be more specific between a dozen and 

5 a hundred? 

6 MR. JANIS: If you can be more specific, tell him. 

7 If you can't be, don't. 

8 THE WITNESS: I said I cannot recall that it was 

9 more than a dozen or a hundred. I just testified that. 

10 I can't recall if it was more than a dozen, so how can I 

11 say it was between a dozen or a hundred? 

12 MR. HOLMES: My question is we got it between — 

13 THE WITNESS: I don't believe it was more than a 

14 dozen. 

•J5 MR. WECHSLER: No, you don't have it, right? 

16 He said he didn't think it was more than a dozen. 

17 MR. LIMAN: I think he testified it was not more 

18 than a dozen. 

19 BY MR. HOLMES: 

20 Q You think it was less than a dozen? 

21 A Yes, I believe so. You asked me to give you my 

22 guesstimate. 

23 Q Were there any documents in there that you read? 

24 A I don't recall reading any of the docujnents. 

25 Q So how do you know what they referred to? 



lHI£MMIiffi¥^^^'^'^D 



786 





1 

2 

3 

4 

5 

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7 

8 

9 

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13 

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15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 



A 
it was. 

Q 
A 
Q 
A 



'^^SSIFIED " 



I just take Mr. Zucker's word for what he told me 



Was anybody else there? 

No. 

What did he say? 

He said I may be audited by Swiss authorities and 
there are no owners of these companies. I need your 
signature. 

Q And you believed that they related to the companies 
on Exhibit Number 8? 

A I believe it is that, also, plus the other 
companies that we might have used that we did not have any 
so-called owner for it. What I am trying to say is it 
could go beyond the list -- beyond the chart. 

MR. LIMAN: Mr. Hakim, so this testimony is 
clear, it was always intended that you have the ownership of 
those companies? 

THE WITNESS: Yes. 

MR. LIMAN: But you had not gotten around to signing 
thapapers, is that it? 

THE WITNESS: Yes, not only that we intended to 
dissolve them as we did not need them. If you recall that, 
yes. The answer to your question is, yes. 

MR. LIMAN: Do you remember whether or not he 
had back-dated the documents so that your ownership was as 



787 



UNS)l^iiP'^«« 



1 
2 
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5 
6 
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7fO 



.147 



of the date that the companies were formed as opposed to this 
November date? 

THE WITNESS: I don't know. I can only 
speculate. 

MR. LIMAN: Your speculation was that you back- 
dated them? 

THE WITNESS: I don't know. 

MR. LIMAN: But you don't know. 

MR. HOLMES: Mr. Hakim, in Exhibit 23, there is no 
Hakim signature on any documents that relates to the 
ownership of Hyde Park Square Corporation. The only 
signature on such a document is Mr. Farina's. The only 
signature that we have for you on this company is the 
signature specimen. 

THE WITNESS: Yes. 

MR. JANIS: For the record, the document to which 
you are referring, which is H-190, indicates that Mr. Hakim 
is the controlling person of the canpany. 

MR. HOLMES: Yes, that is right, but it doesn't 
require his signature. 

THEtWITNESS: So I don't understand what your 
question is. 

MR. HOLMES: Well, that is because we were 
interrupted. 

MR. LIMAN: Let rae see that a moment, and let's 



uimsimw. 



'^SIF 



Wn 



788 



8-7 



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2 

3 

4 

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8 

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25 





go- off the record. 



^iAS 



148 



%^^ 



(Discussion held off the record.) 
MR. HOLMES: Back on the record. 
BY MR. HOLMES: 
Q Mr. Hakim, you have said that you didn't sign in 
that instance to your kn'-'oledge, documents such as 
H-188. 

A Pardon me? 
Q Is that correct? 

A You mean you are talking about the hotel visit? 
Q Yes, we are still talking about the hotel visit. 
(Witness confers with his attorney.) 
THE WITNESS: So it is that incident you are 
referring to. 

MR. HOLMES: When Mr. Zucker appeared in November 
'86 at your hotel in Geneva. 

THE WITNESS: Yes, sir. 
BY MR. HOLMES: 
Q You are saying you did not sign on that occasion 
documents such as H-188? 

A As far as I recall, yes. 
Q The signature card. 
A As far as I recall. 

Q You did sign something and you think that those 
somethings related to the various companies on Exhibit No. I 



wmmh^. 



Q^Crri;^;:;^* 



789 





1 

2 

3 

4 

5 

6 

7 

8 

9 

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22 

23 

24 

25 



Yes. 



"^Ss^ 



149 



^-"/-ft) 



Q I would like to know why some things have not been 
produced to us since they are obviously not within the 
documents in Exhibit Number 23. 

MR. JANIS: There is nothing that we have not 
produced to you. If you want to play this game, let's 
get out all the corporate docxanents, put them all on the 
table and see. 

MR. LIMAN: You have not produced the fiduciary 
agreements, have you? 

MR. JANIS: We have produced everything there is to 
produce. 

MR. LIMAN: I thought you said there were documents 
from Switzerland and that they were mailed to Mr. — 

MR. JANIS: But they are not responsive to this. 

MR. LIMAN: To Mr. Nields. 

MR. JANIS: I want scnebody to give us the 
records — let me finish my statement. I want someone to 
give us now the corporate records and signature cards for 
•«ch of these accounts. We will look at them, and at the 
dates and see whether he signed and we will be prepared to 
answer. 

MR. LIMAN: Are you saying you have already 
produced the documents that he signed in November? 

MR. JANIS: We think we have. What we need to do 



790 



8-9 



uim^pni^ 



is let's look at 



150 
the 



1 if-you are going to ask these questions 

2 documents . 

3 MR. LIMAN: I inspected the docvunents before 

4 you produced them? 

5 MR, JANIS: Sure. 

6 MR. LIMAN: Are you telling us that your 

7 understanding is that those documents have been produced? 

8 MR. JANIS: That is my understanding. 

9 MR. LIMAN: If you looked over the documents we 

10 have received, do you think you would be able to identify 

11 them? 

12 MR. JANIS: I don't know. Let's take a look 

13 at them. 

14 MR. LIMAN: Have you seen those documents? 

15 MR. JANIS: I have seen all the documents 
15 that were produced to you. 

17 MR. LIMAN: Have you seen the documents that you 

18 believe you signed in November, the so-called fidicuary 

19 agreements to these different copies? 

20 MR. JANIS: He has not testified that it was simply 

21 fiduciary agreements for the companies that he signed for. 

22 He said he signed a number of documents . 

23 MR. LIMAN: But they were documents that he signed 

24 which he testified reflected the fact that he was the 

25 beneficial owner of the companies. That is what I understood 



lCDIS$K»a,^s 



JFWr\ 



791 



1 

2 

3 

4 

5 

6 

7 

8 

9 
10 
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12 
13 
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23 
24 
25 



UNQSmP 



ca 



151 



his testimony to be before and today. 



^/rj 



fio 



MR. JANIS: He doesn't recall just what it was 

2. 
that he signed. He signed them quickly for Mr. »ucker. 

MR. LIMAN: He said he believes that is what he 
signed. What I am asking you is have you seen such 
documents? We don't have to play hide and seek. 

MR. JANIS: I am not playing hide and seek. 
I am telling you I don't know and I don't think he knows 
precisely what it is he signed. If you want to ask him 
about signature cards and things like that, let's look at 
them. 

They are dated and we can see what they are dated. 

MR. lilMAN: Have you seen documents that reflect 
he is the beneifcial owner of these companies? 

MR. JANIS: Yes, and so have you. 

MR. LIMAN: Have you seen them? 

MR. HOLMES: No. 

MR. JANIS: They were in the records that were 
produced. Let's stop playing this game. You are playing 
hide and seek and I don't appreciate it. 

MR. HOLMES: We don't have records that match the 
description of what Mr. Liman just described. 

MR. JANIS: Let's not play these games anymore. 
You have the records, let's bring them up now and take a 
look at them. 





I 






792 



1 

2 

3 

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8 

9 

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21 

22 

23 

24 

25 



MR. LIMAN: Do we have them here? 



%; 



152 



■/^o 



MR. ZANARDI: They are upstairs. 

MR. LIMAN: Are they upstairs in the house? 

MR. JANIS: You can bring them all down here. 

MR. LIMAN: Let's see if they can find these 
and meanwhile move on. 

John, you can go up and see if we have the documents 
on the ownership of the companies. 

MR. JANIS: Bring. back all the binders that we 
produced. 

MR. LIMAN: If we can find the documents I don't 
have to bring it all down. 

MR. JANIS: I didn't say anything about fiduciary. 
He has not testified — I know you would like it to be 
this way, but that is not what he said. He didn't say 
that these were fiduciary agreements that he signed. He 
said that these were documents that he signed relating to the 
companies. You have asked me if there are any documents 
that were produced which indicated that he was the con- 
trolling person of these companies, and the answer to that 
is, yes, £md you have it. 

You want to bring them down? We can take a look 
at them. 

MR. LIMAN: Meanwhile let's move to another subject. 



yNfiy${»i$i^ 



SSIFIED 



793 



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24 
25 



BY MR. HOLMES: ^^^S/j^/t/s. 

Q Mr. Hakim, after Mr. Zucker left your hotel that 
night, did he leave you with copies of what you had 
signed? 

A To the best of ray recollection, no. 
Q And did you ever approach Mr. Zucker thereafter 
and ask him for copies of what you had signed, or the 
originals? 

A As far as I recall, no. 

Q Do you have any idea where in the world those 
documents might be now? 

MR. JANIS: You probably have them. 
MR. HOLMES: I am asking him. He is the witness. 
THE WITNESS: I have no idea, sir. 
BY MR. HOLMES: 
Q To your recollection have you ever produced 
those documents to your lawyers? 
A My lawyers — 

MR. JANIS: Mr. Hakim, just a minute. 
(Witness confers with his attorney.) 
THE WITNESS; Could you read the question back to 
me please? 

(The question was read back by the reporter.) 
THE WITNESS: I don't know what those documents 
are, and I cannot recall not knowing what those documents 

ILASSIFIED 



UHCUSiii^^ 



794 



8-13 



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 



WWHWIK 



are if they have been produced or not. 



M, 



154 



%0 



MR. LIMAN: Did you make the selection of the 
documents that were produced for us? Did you go to 
Zucker's office and pick out what documents would be 
produced and which ones wouldn't? 

THE WITNESS: As far as I remember, no. 
MR. LIMAN: Who handled that for you? 
THE WITNESS : To the best of my knowledge — 
(Witness confers with his attorney.) 
MR. LIMAN: What handled that for you? 
THE WITNESS: To the best of my recollection, the 
request was made through my attorney — Swiss attorney- 
through their system and their system in the ethical and 
legal way the process was, he did that. 

MR. LIMAN: And your Swiss lawyer's name is? 
THE WITNESS: Mr. Philip Neyroud. 
BY MR. HOLMES: 
Q I gather that you gave Mr. Neyroud instructions 
with regard to the collection of documents for your subpoena: 
A Yes. 

Q When and where did you do so? 

A I cannot recall the dates, but it was in Geneva, 
Switzerland. 

Q How long before your deposition on April 20, 1986, 
did you do so? 






smo 



795 



22 



24 
25 



inmsBUFv. .^^ 



2 Q A few months before that? 



1 A Probably a few months before 'that. ^^/A) 



3 A That I gave him instructions, yes, that is the best 

4 of my recollection. 

5 Q So somewhere around January, February 19 86? 

6 A 1986? 

7 Q Excuse me, 1987. 

8 A I am confused with the dates the way they are, so 
g yes, probeibly, about that time. 

10 Q Who else was present? 

11 A I don't remember if I recall correctly, Mr. 

12 Janis was also present. 

13 Q What did you tell Mr. Neyroud? 

1^ MR. JANIS: Don't answer the question. 

Ig We will not get involved in conversations he had 

1g with his attorneys. 

MR. LIMAN: We are entitled to know whether the 
document search here was one that was responsive to the 



19 subpoena. 



20 



MR. JANIS: I will tell you this so we can cut 



21 through all this. 



MR. HOLMES: I am not so sure we will be able to 



23 take your testimony, Mr. Janis. 



MR. JANIS: Fine, don't answer the question. 
MR. LIMAN: Mr. Holmes, I want to know — 

iHllELMaalllDllr 



796 



8-15 



UNtUtSSffiEBS?; 



SIFIEO 



156 



1 . MR. JANIS: My testimony is not being taken now. 

2 MR. LIMAN: I am asking for a representation 

3 as to what was done to collect the dociunents pursuant 

4 to the supboena. 

5 MR. JANIS: Requests were made through Swiss counsel 

6 to obtain all information necessary, to tra4e the flow of 

7 funds in all of these accounts. I will tell you that 

8 more than one request was made because when documents 

9 were produced and there were gaps in the documents, 

10 requests were made for an additional document. And 

11 a series of requests were made and CSF responded through 

12 its Swiss counsel to Mr. Hakim's Swiss counsel and produced 

13 documents. 

14 MR. LIMAN: Were requests made for all documents 

15 reflected both ownyership and signature power on these 

16 companies? 

17 MR. JANIS: Yes. 

18 BY MR. HOLMES: 

19 Q How do you explain the failure of the Swiss counsel 

20 to come up with the so-called wills? 

21 MR. JANIS: I am not under oath, and I am not 

22 sure there is a failure and I don't think that that is 

23 responsive anyhow to what Mr. Liman was asking me about. 

24 MR. HOLMES: But the question is — we first learned 
25 



of it from Mr. Secord months later. 



lUjmjGjUaDHQA 

lIHialMiKUr tNK'r 



SSIFIED 



797 



llilwwIfflBSavcMs. 



>S/f/5Q 157 

"I MR. JANIS: I am not here to be interrogated. Ask 

2 your next question. 

3 MR. LIMAN: They should have produced them and they 

4 didn't. 

5 MR, JANIS: There may be other records they should 

6 have produced and didn't, but it has nothing to do with the 

7 lack of good faith on our part, and Mr. Hakim's part. 

8 Mr. Hakim, as he made clear, doesn't have custody of 

9 the records. Any time he wants to records — he has to go 

10 back to CSF and make a specific request and he has done 

11 that on a number of occasions through counsel. 

12 MR. WECHSLER: Mr. Janis has also said we made 

13 repeated questions because we did recognize gaps. If we had 

14 taken the first production, it would have been far less than 

15 what you ultimately received. 

16 MR. LIMAN: Did you — did you, Mr. Hakim, 

17 either directly or on behalf of or through any agents or 

18 attorneys ask the Swiss lawyers for Zucker or his company to 

19 withhold any documents? 

20 THE WITNESS: Withhold, you meem withhold from 

21 giving it to you? 

22 MR. LIMAN: Yes. 

23 THE WITNESS: Absolutely not. 

24 MR. JANIS: I will say even though I am not 

25 testifying, eibsolutely not. The contrary is the case. 



lUSSIfKO^CLASSIFIED 



798 



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 



iliQ9l<S!HI]IBET 



158 



If anyone understood what we went through to get the 
records that you have, you would have a better appreciation 
for that. We have had to go back to them on a number of 
occasions and make a number of requests in order to try to 
put together as complete a picj^ture as possible. 

THE WITNESS: If I may also testify chat I was 
present, that because of the assisting of Mr. Janis they 
almost threw him out of their offices. 

MR. LIMAN: Mr. Secord was with you in Geneva 
before these records were produced. 

MR. JANIS: I don't think so. 

MR. WECHSLER: No. 

MR. LIMAN: He testified to that. 

THE WITNESS: Excuse me. 

MR. LIMAN: Was Mr. Secord in Geneva with you before 
these records were produced? 

THE WITNESS: Talking before April 20? 

MR. LIMAN: Yes. 

THE WITNESS: No. 

MR. LIMAN: Was he with you in Paris? 

THE WITNESS: Absolutely not. 

MR. LIMAN: YOU didn't meet with him before 
these records were produced? 

THE WITNESS: No, sir. 

MR. LIMAN: I may be mistaken. '•C\V\t.^ 



vmmm 



acvA^- 



25 



159 



799 



1 MR. JANIS: That is precisely what Mr. Secord 

2 testified to, and he was incorrect. 

3 MR. LIMAN: All right. 

4 BY MR. HOLMES: 

5 Q Was Mr. Green present in either Geneva or Paris to 

6 your knowledge at any time from November 1986 through 

7 April 1987? 

8 A I remember one occasion. 

9 Q Only one? 

10 A I remember one occasion. 

11 Q When and where? 

12 A It was in Geneva after the Paris process. 

13 Q After April 20? 

14 A Yes, in the presence of my lawyers in Geneva, 

15 I believe, I met with Mr. Green. 

1g Q Who was present at this meeting in Geneva? 

17 A My both lawyers, Mr. Green, Mr. Secord. 

13 Q Who do you mean by both lawyers? 

19 A Mr. Wechsler and Mr. Janis, Mr. Tom Green, 

20 Mr. Richard Secord. 

21 Q And yourself? 

22 A And myself, yes. 

23 Q Where in Geneva did you meet? 

24 A In my hotel. 
Q What hotel? . k C5>\n^*^ 



otel? ^C^ 



25 



160 



800 



1 . A Cornavin, C-0-R-N-A-V-I-N, I believe. '^S/^i 

2 Q How long did you stay there on that occasion? 

3 A I had other meetings, if I remember correctly, 

4 for sometime, so I don't remember how long. 

5 Q More than a few days then? 

6 A Oh, yes. After my attorneys — I believe all 

7 the four gentlemen left together and I was — I stayed 

8 behind to conduct my business. 

9 BY MR. HOLMES: 

10 Q How long was Mr. Secord there? 

■J1 A As far as I can remember he left about the same 

12 time that the other three gentlemen left. 

13 Q Was he there at any time when his lawyer was not 

14 there? 

15 (Witness confers with his attorney.) 

1g THE WITNESS: Okay. I had some business 

17 associates to meet with me, and Mr. Secord stayed a day or 

18 two longer to meet with those people. 

19 BY MR. HOLMES: 

20 Q Who were they? 

21 A A group of Irani2m businessmen. 

22 Q What was the nature of their business? 

o<j A The nature of the business was to establish a 






24 trading company and their capabilities dealing with carpets 



and various products we could import from Iran. 



iiCUSSIREbncL^^ '» 



801 



WWHSSIBPS^^s'F/Eo 



161 



1 . Q That is import into the United States from Iran? 

2 A No, just Viyplace in the world that they would 

3 buy it. These people live in Europe. 

^ Q So they were in the export business in Iran, 

5 exporting to the rest of tha^orld? 

6 A They are in the import-export business, yes. 

7 Q Do you have any association with the — do they 

8 have any association with the people we have identified 

9 on paper earlier today? 

10 A Some of them do. 

11 Q How many were there? 

12 A I can't remember, maybe 3, 4, and I believe one had 

13 to do with one of the people that you have identified 

14 with me. 

15 Q Apart from that person, what is the name of the 

16 business that they represent? 

17 A The neune of the business? 

18 Q Yes . 

19 A Are you asking for the neune of their companies? 

20 Q Right. 

21 A I believe the company that they are forming or 

22 they have formed, if I remember correctly, as I testified 

23 earlier, I have been busy trying to create a new business 

24 network, and these people were there to create those 

25 companies. I believe they have formed a company. 



Htfffllf^-- 



;t 



802 

1 If. I am not mistaken the name of the company is Critex. 

2 I am not sure. 

3 Q What are the names of the companies that they 

4 represent or represented before they formed Critex? 

5 A I have no idea. 

6 Q You don't know the names of the companies that 

7 these people were representing? 

8 A I didn't testify that they represented any 
g companies. I said they imported goods from Iran. 

^Q Q Did they do so under any business name? 
^^ A I have no idea. Their association with us 

12 started in this manner only as a result of the recent 

13 efforts of mine. This is a new endeavor. 
Q Would you describe the proposed business of 

15 Critex, please? 

A The proposed business of Critex is to either act 
as Liaison between buyers and sellers or import as whole- 
salers and sell it to the interested parties depending 

19 on the products they import. 

20 



17 
18 



Q Does it propose to engage in any particular 
21 specialities, any particular products? 

22 



23 
24 
25 



A It proposes to deal with the products that can be 
imported from Iran such as dried fruits and nuts, pistacios, 
caviar, carpets, anything marketable, anything they can 
bring from that country. 

IIMM ACCICUaII-, 



j.uj^ii ituj^jty 



OSSIFIED" 



803 

MR. LIMAN: We have these records now and I am 
told by Mr. Monsky that the records that you produced have som^ 
bank records that reflect who controls the company, but 
that what we did not get are the powers that run from the 
directors of the Panamanian corporation in favor of 
Mr. Hakim or from Mr. Zucker's company indicating that 
Mr. Hakim is the owner. So that that step which you would 
expect to find with Panamanian companies, Bermuda companies, 
off-shore companies, where the directors or the Swiss 
fidicuary pledges the shares or gives the power to the 
beneficial owner, that dociunentation is missing, and we 
request that you see whether you can obtain that. 

I think the documents that you are referring 
to that showed beneficial ownership are the bank records 
and we have that for three companies. You could show 
them the one for example of Di 

MR. JANIS: You also have this. 

MR. LIMAN: This is H-747. 

MR. JANIS: And you have corporate records for 
each of them. 

MR. MONSKY: If you looked at them you would see 
they were a dead end in a sense. If you walked in a court- 
room and said, "Who owns these companies, the dead end. 
Is that Zucker's people that work for him control the 
companies as a legal matter 



nNKer 




164 



804 

1 _ MR. LIMAN: They show Farina of Bern, Mosee, 

2 and the document you would almost always see with these 

3 comapnies around which I suspect he signed in November 

4 have yet to be produced. 

5 MR. JANIS: I think — of course I don't 

6 have the records in front of me — as I recall some of those 

7 corporate records indicate who was the owner of 

8 the stock. I know in at least a couple cases that is the 

9 case. 

10 MR. LIMAN: We will check it. 

11 MR. JANIS: So that would not be a so-called 

12 "dead end." This will save us all a lot of time and 

13 trouble; what we can do is if you have some specific 

14 documents that you are looking for put it on a piece of 

15 paper to us, and we will be communicating that request 

16 to the custodiam of the records. 

17 Other than that I can't help you. 

18 MR. HECHSLER: It may make sense to hold it 

19 until tomorrow to see what we get in the mail, because 

20 the documents you are looking for may be in the package 

21 that we are hopefully going to receive tomorrow. 

22 MR. LIMAN: Good. 

23 MR. JANIS: I also think you should go back over 

24 the corporate records again and the other records to see 

25 whether you already have these things. 




IMPIAJ 



iSi^^'., 



805 



UNDoeiitai^ 



IPIED 

' MR. LIMAN: I am sure Mr. Monsky, as a corporate 

2 lawyer, did that and I an confident that he knows where 

3 to look. 
BY MR. HOLMES: 

5 Q We don't have them with Mr. Hakim's signature 

6 on them. What we have is like what we have in Exhibit 23; 

7 that is, a bank signature card, not the so-called fiduciary 

8 agreement. 

9 MR. MONSKY: Are you s^tating that with respect 

10 to some of the corporations here there are copies of stock 

11 certificates that show that Mr. Hakim owns it? 

12 MR. JANIS: No. 

13 MR. MONSKY: Where are the certificates? 

14 MR. JANIS: I have no idea. I really reject 

15 the implication that some how we have withheld documents. 

16 That simply is not the case. 

17 MR. LIMAN: You have made it clear that the 

18 documents are in the custody of Mr. Zucker. What I am 

19 saying to you is that — 

20 MR. JANIS: I am saying that there are documents 

21 in at least some instances that I know that are there that 

22 say, for example, in one instance, I recall off the top of 

23 my head that there are a hundred shares of stock and the 

24 owner of that stock is Albert Hakim. 

25 You have that in the records we have produced. 



UHttASSIfllfe'"^ 



806 



23 



mmMSf 



166 



»%0 

1 I thadnk there is more than one company where that is the 

2 case. But was there a sealed, you know, embossed 

3 certificate of incorporation? 

4 MR. LIMAN: I wouldn't expect that. I would 

5 expect there to be either a power or some other designation. 

6 MR. JANIS: What 1 suggest you do instead of 

7 cross-examin^ing Mr. Hakim about documents he ceui't 

8 recall is make up a list specifically of what it is that you 

9 want, and we will communicate that request. 

■JO MR. MONSKY: We will give you our chart and then 

\'\ show you where the missing pieces are. 

12 MR. WECHSLER: I Still suggest we do that after 

13 tomorrow because hopefully we will get what we are looking 
■J4 for in the mail tomorrow. 

15 BY MR. HOLMES: 

15 Q Mr. Hakim, with regard to the documents that were 

17 referred to in your deposition in Paris concerning the 

13 ones that were deposited with the Swiss fiduciary — do you 

19 recall that reference in your deposition? 

20 A I think so. 

21 Q I would like to know when they were deposited 

22 with him, with the Swiss f idiouagy . 



MR. JANIS: I'm sorry, could you repeat that 

24 question? 

25 (Question read back by the reporter.) 

.SifJiD 



uiifiiiiiTJHnnfih, I 



807 



UNOEKSSiiliX, 



-/£D '" 

1 - MR. JANIS: I am sorry, I am not sure I 

2 understand the question. 

3 THE WITNESS: I understand it to mean the 

4 officer of the court. 

5 MR, HOLMES: All right. 

6 MR. JANIS: Is that what you referred to? 

7 MR. HOLMES: The ones referred to in your deposition 

8 MR. JANIS: Wait, I am still not sure I understand 

9 Are you referring to documents that were put under seal 

10 with the court official? That was referred to in his 

11 deposition. 

12 MR. HOLMES: The ones I will get to, who they were 

13 put under seal to, but — 

14 MR. JANIS: You were referring to documents that 

15 were not produced, but were placed under seal. 

16 MR. HOLMES: Yes. 

17 THE WITNESS: To the best of my knowledge, these 
•J8 are the documents that should be received by Mr. Nields 

19 that had been sent on Friday if I am not mistaken. 

20 MR. HOLMES: These are the same docximents we are 

21 talking about. 

22 THE WITNESS: I believe so. 

23 BY MR. HOLMES: 

24 Q What leads you to that belief? 

25 A Because of the information my attorneys have given 



UmASSm^ssiHED 



808 



25 



URetSSSRBPRwa- 



168 



1 me^ They have coimnunicated with Switzerland. 

2 Q Let me find out from you when those documents 

3 were placed wherever they have been for at least since 

4 April 20? 

5 MR. JANIS: He wants to know when they were 

6 placed under seal. 

7 Q Where have they been, Mr. Hakim? 

8 A From the minute we got them we put them in the 

9 custody of the court officials. We did that with the 

10 officer of the Swiss court. 

11 Q All right. And where was that? 

12 A In Geneva, Switzerland? 

13 Q And who was that? 

14 A I don't recall the name of the court officer. 

15 Q What is the title? 

15 MR. JANIS: He is called the Louissier? 

17 THE WITNESS: I don'tknow. Mr. Janis , no, sir, 

18 what the title is. 

19 BY MR. HOLMES: 

20 Q When did this happen? 

21 A Sometime in December of 1986. 

22 Q December of 1986? 

23 A Yes . 

24 Q What documents were they? 
I can ' t remelnb6r . 

SSIFIED 






809 



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 



UMI!BBSFI?P|,^ 



169 



Q How many documents were they? 

MR. JANIS: Can I suggest something? We have 
all be here a long time. I understood the purpose of this 
deposition to have been to prepare the witness for his 
public testimony. We have already told you, he has testified 
that all of the documents that were placed undej. seal 
have been requested and will be provided. 

So what is the point of asking him today when you 
are going to get all the documents tomorrow? What are the 
documents that you are going to get tomorrow? It is 
just a waste of time. 

MR.. HOLMES: Because I want to know today so I will 

; 

know tomorrow. 

^' THE WITNESS: I don't remember. 

MR. HOLMES: So I will find out tomorrow what 
I get out of the mail. 

MR. JANIS: I think we ought to deier that question 
until we get them, then you can ask him if there was 
anything placed under seal that was not provided. 

MR. HOLMES: Mr. Hakim, what did you place under 
seal? 

THE WITNESS: I don't remember, Mr. Holmes. 

BY MR. HOLMES: 
Q The documents of what type were placed under seal. 



though? 



miimim 



ss\nsx 



810 



1 . A To the best of ray recollection they included some 

2 invoices, and these are I think all a matter of record 

3 already. We went over that so — 

4 Q There was invoices. What did they relate to? 

5 A To the best of my recollection they had to do with 

6 Defex. There were some variuas kinds of small amount of -- 

7 (Witness confers with his attorney.) j 

8 THE WITNESS: Small aroounts of various documents 

9 that piled up. We did not even, to the best of my 

10 recollection we did not even list them with this court 

11 officer. I also recall there were some classified documents. 

12 BY MR. HOLMES: 

13 Q What do the classified documents relate to? 

14 A If I remember correctly — I may be wrong — 

15 but I believe these are the documents that actually 

16 belong to General Secord that he left with me, and had 

17 to do with his trip to Israel. 

18 I am just guessing. I actually can't remember. 

19 Q You have mentioned listing documents with the 

20 court. 

21 A I said we did not even list it. 

22' Q Was there some process that he went through or 

23 did you inventory the documents you were putting with the 

24 court? 

25 A He went through a process, the Swiss are quite 

vSSlFlEO 



UNCUSStFia^T' 



811 



1 bureaucratic and I don't recall right now what was the 

2 process that we went through. 

3 Q But some form of inventory was prepared? 

4 A Yes, some sort of. 

5 Q I assume you signed the inventory? 

6 A I don ' t remember . 

7 (Witness confers with his counsel.) 

8 THE WITNESS: I don't remember signing such 

9 inventory. I just can't remember, Mr. Holmes, what was 

10 the process we went through, but we went through a 

11 certain process. 

12 BY MR. HOLMES: 

13 Q Who was there? 

14 A The court officer was there, Mr. Neyroud was 

15 there, Mr. Janis was there. 

16 Q Anybody else? 

17 A It is very possible that one of the secretaries 

18 was there. I can't remember. One of the secretaries of, 

19 Mr. Neyroud. 

20 Q Where did the Defex invoices come from? 

21 A I believe, like I said, these documents belonged 

22 to Mr. Secord, gave them to me. 

23 Q Mr. Secord had given them to you? 

24 A To the best of my knowledge. 

25 Q Where did he give them to you? 



IIWUSS|fM««sw 



812 



17 
18 
19 
20 
21 
22 
23 
24 
25 



UNDEKSSiat^. 



mo 

1 (Witness confers with counsel.) 

2 THE WITNESS: Excuse me. 

3 BY MR. HOLMES: 

4 Q Where did he give them to you? 

5 A I don't remember, but they were given to me 

6 sometime back. They were left with CSF as a request — 

7 as part of the request that we made for CSF to produce 

3 documents. They sent those to us while we were all there 

g and when it was received, my lawyers decided that it was 

1Q best we left them in the custody of the court officer. 

^■^ Q What other kinds of doctjments were there? 

^2 A I don't remember. 

^a Q I need a total of docxmients as close as you can 

14 get, 

« A I cannot guess, Mr. Holmes. I cannot remember. 

1g Let's go on. 



Q I want you to estimate the total number of 
documents. 

A I am sorry, I cannot help you, Mr. Holmes. 
Q Is there more than a hundred. 

MR. OANIS: Next question. Let's get on with 
this. This is ridiculous. 

MR. HOLMES: There is a method by which you could 
have avoided this, and that was to produce the documents. 
MR. JANIS: They are being produced tomorrow, 



U 





gIFIED 



813 



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 




Mr, Holmes. 




ET 



173 



MR. HOLMES: Some documents are, but — 

MR. JANIS: Yes, and I am probably engaged in a 
conspiracy to obstruct justice and hold back all the 
damaging documents — come on, this is abcouped. Mr. Liman, 
I want to take a break and I want to talk to you. 

MR. HOLMES: We are not off the record yet. 

MR. JANIS: Albert, come on, we are taking a 



break. 



MR. LIMAN: Let's take a break. 
MR. JANIS: I want to talk to you. 
(Recess. ) 




IFIEP 



814 



«9 (5:00 pm( 
magi 

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 



iinaasifi^ 



174 



- MR, LIMAN: On the record. 

Mr. Holmes will have a few more questions. 
I wanted to ask something to clarify so I understand 
it, and then Tim is going to go on some of his with respect 
to the second channel. Let me put questions so I understand. 
BY MR. LIMAN: 

Q Do I understand that the documents that were put 
under seal were assembled by you some time after November of 
1986? 

A No. 

Q When did you get those documents? 

A The same day that we received it from CSF, upon 
advice of my Swiss lawyer and approval of Mr. Janis, we 
immediately called and put a lot of pressure and brought 
the court officer there and put it in his custody. 

Q Mr. Jariis began representing you after the events 
of November of 1986, correct? 

A Yes, sir. 

Q These are documents such as the Defex invoices -- 

A With CSF. 

Q — that were sent to CSF some time before, correct? 

A Correct. 

Q Why is it that CSF gave you these documents when 
they did as opposed to keeping them at CSF? 

A Because the process of continuously commanding 



IINHUSJMIkfis 

intiiCnaftiriEfiiyp 



IFIED 



815 



OttCM^t^ 



175 



e wa^a 



■ documents and checking to see what there wa^and what they 

2 had not sent, continuously calling the attorneys of 

3 Mr. Zucker. 

^ It was a hide-and-seek process. As a result of 

5 that, these documents were coming in. 

6 Q Where I aun having difficulty, for example, the 

7 documents that you produced for us in Paris were not 

8 documents that were put under seal; am I correct? 

9 MK. JANIS: Are you interested in making a record or 

10 finding out what happened? 

11 MR. LIMAN:* I want to know why some documents are 

12 under seal and other documents were produced to us, which 

13 I presume were not under seal. 

14 MR. JANIS: What happened was when I was there in 

15 December, CSF on its own sent over a number of records that 

16 it had that apparently, I thought, were sensitive, and we 

17 immediately put them under seal with a court official. This 

18 was before any of the accounting records had been produced 

19 to the committee and were provided by CSF. 

20 MR- LIMAN: Did you keep an inventory of what those 

21 records were? 

22 MR. JANIS: No. 

23 MR. LIMAN: Was there an inventory made of those 

24 records? Usually, there is when a court takes documents. 

25 MR. JANIS: There was not an inventory made. The 



imA5»fei«D 



816 



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 



tfWBBWPI 



'%^ 



176 



documents were placed in sealed envelopes. 

MR. LIMAN: Is what is going to be produced now 
all of those documents? 

MR. JANIS: » Yes. 

MR. LIMAN: Is the process that they are going to go 
from the Swiss magistrate to the Swiss lawyer and from the 
Swiss lawyer to Mr. Nields — 

MR. JANIS: Yes. 

MR. LIMAN: So they are being sent directly from the 
Swiss lawyer to Mr. Nields? 

MR. JANIS: Yes. 

MR. LIMAN: And he has obtained copies of them from 
the Swiss magistrate? 

MR. JANIS: I understand that you will be getting 
the original documents. 

MR. LIMAN: And if we — • just so that we have our 
records in Oder, I would ask, without intending to insult 
the Swiss lawyer, for the equivalent of a certificate of 
compliance of production that he has turned over to 
Mr. Nields all of the documents that he received from the 
Swiss magistrate and that were lodged with that court. 

MR. JANIS: Number one, tha^ won't be a problem, 
and number two, it is entirely possible that there may be 
such a statement — 



MR. L 





be one attached? 



3£flNCLASSIFIED 



817 



1 

2 
3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

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25 



IINSBB«SgT_ 



177 



MR. JANIS: Attached when Mr. Nields receives the 
documents. 

EXAMINATION BY COUNSEL FOR SENATE SELECT COMMITTEE 

BY MR. HOLMES: 
Q Mr. Hakim, we talked about a company called Critex. 
Where is that located? 

A Mr. Holmes, when we met, the whole idea was to create 
a new network. I earlier testified that as the; result of 
the Iran-contra initiate, the companies and the businesses 
structured that I had for many years was totally destroyed, 
and I was busy during the past five or six months trying to 
establish a new structure. 

In trying to establish a new structure, I have 
asked a number of business associations, new business 
associates, to participate. The meeting that we are talking 
about in connection with Critex was at the early stage 
of trying to establish that organization. I aun unaware what 
they have done and what is the location and where these 
people have established their — to be their headquarters 
for their operation. 

I have been moving to a number of cities, meeting 
with a number of people, trying to create a new structure 
to deal with Iran, and as soon as I finished with that, I came 
here to comply with the requirements here in connection with 
this investigatio 



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178 



where they are at and what the status of each company is. 

Q Are you aware of an organization called the Arab 
Development Group? 

A I used this ncune — I don't know if there is a 
company by that name or not. I testified earlier when we 
started to deaJ. with this TriAmerican Arms or so-called the 
Investment U.S., we told the people that it is the foreign 
investment money that is coming in and it is coming in from 
the Middle Eastern people. 

I asked Mr. Zucker to send these names. under a 
name that would reflect my representation to the people in 
the U.S. He used that name. Whether there is a company 
by that name or not, I have no idea, or he just used it for 
the bank records. I really don't know. 

Q Is there a bank account with that name? 

A flot that I know of. 

Q In your own mind, who is the Arab — let me ask 
this question first. 

I gather that there is no business that is using 
that name, whether a corporation or any other form? 

A Not that I know or or that I have any association 
with. 

Q It was to signify a concept of Iranian involvement! 

A No, the concept was to represent the Americans, 



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179 

taUcing to the Harostica episode, to represent these people 
that the money coming for this investment is money of Middle 
Easterners, so I requested Mr. Zucker to reflect on the bank 
transfer and bank documents the nzune "Arab Development" — 
or I didn't even come up with the name "Arab Development", 
come up with something that would have the name Middle East, 
Arab, Iran, so that is what he came up with. 

Whether there is such a company, I have no idea. 

Q So, you told Marostica and others that there was 
such an organization? 

A Yes. 

Q And, in fact, the money was coming from the Lake 
Resources group? 

A As I testified, yes. 

Q Have you used the neune "Arab Develo{snent Group" or 
"Arab Development Corporation" in any other context? 

A Not that I remember now. 

Q Do you recall generating any cash under that name? 

A I don't understand the question of generating cash. 
You mean the company doing business and mzOcing money, is 
that — 

Q I could be wrong, but as I recall your secretary — 
one of your two secretaries has said that she was instructed 
to charge a cash withdrawal from STTGI to the Arab 



Development Group. 






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180 

1 'A . I don't know what you are referring to. I have 

2 no idea. But it could be, again, in connection with the 

3 same STTGI's involvement with Marostica and the investment. 
^ I have — 

5 Q Do you recall ever having any cash that was 

6 associated with that name? 

7 A I have difficulty understanding, Mr. Holmes. 

8 Q That is a relatively unusual method of transferring — 

9 I believe the eunount was $30,000. 

10 A Transfer by Arab Development? 

11 Q To the account of, according to your secretary. 

12 A I have no idea what she was talking about. If you 

13 can give me the context — 

14 Q I will. 

15 In the meantime, let's pass to the second channel. 

16 MR. WOODCOCK: Mr. Hakim, I am Timothy Woodcock. 

17 I am also with the Senate Committee. 

18 Before I begin my series of questions, I would 

19 lite to clear up for the record a little bit on this piece 

20 of' paper which you identified as being a person whom you 

21 describe as being the Engine. 

22 Could we have this marked as a deposition exhibit? 

23 This will be sealed with Deposition Exhibit No. 20, but 

24 for future reference, this is now being marked as Exhibit 

25 No. 25, and Exhibit No. 25 does contain the name of the person 

ILASSIFIED 



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181 



that you have earlier called the Engine; is tlTat correct? 
THE WITNESS: Yes. 

(The document marked Exhibit No. AH-25 follows:) 
♦ •••♦*«*««(;Qji^jijj.r.p£g INSERT********** 
EXAMINATION BY COUNSEL FOR SENATE SELECT COMMITTEE 
BY MR. WOODCOCK: 
Q Mr. Hakim, I am goin? to refer to a name that is 
already a naiae which is publicly kno%m, having appeared in 
the Tower Report, and that is the name of 

Is that a name that is known to you? 
A Yes. 
Q Do you knowj 
A Yes. 

Q How long have you known him? 
A Several years. 

Q Did you know hia when you lived in Iran? 
A Yes. 

Q Do you recall what position — 

A I don't remember whether I met him, but I knew him. 
You knew of him, is that what you are saying? 
A Yes. 
Q But you do not recall whether you met him in Iran or 



later? 



That is correct. 



UNCLASSIFIED 



Q Do you know what his position was in Iran? 



UJNOASSIFIED 



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Q So your understanding, I gather, is that 

Iwas in some way associated wit 

is that correct? 
/ 
A Yes. 

^ Q Do yo\4 recall the circumstances under which you 

met him? You say you may or may not have met him when ., 

you were in Iran. 

A The occasion that I remember meeting him 

occurred after the Iranian revolution. 




I may have met him before that. I just can't 
rMMnber. That particular day I do remember. 

Q Now, Mr. Hakim, let me refer you to Deposition 
Exhibit No. 20 to refresh your recollection on niimbers 
1 and 2. 

Do you know whether the figure No. 1 had any 
kind of association or relationship with 
A Yes, I do 







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What was the character of that relationship? 



A Mr .^^^^^^Iwas his boss, 

Q ml 

A Yes. 

Q Do you know whether since the revolution they 
had maintained a relationship? 

A I know that they for a while maintained a 
relationship and then when No. 1 learned about the 
direction that Mrfl^^^^HKras taking politically, he 
severed his relationship with him, and my understanding is 

that they are not on good terms. 

f 

Q Let me take you a step back on No. 1. I gather 

No. 1 is 2m individual you have known for some years, is 
that correct? 

A That is correct. 

Q Did you know him while you were in Iran? 

A Yes, I did. 

Q Have you kept in regular touch with him since 
you have left Iran? 

A Definitely. 

Q Do you recall when it was he would have severed 
ties withi 

A I cem make an educated guess. I would say it 
goes back some three years, sometime in '84, I would say. 
That is an educated guess. I could be a year off either: 



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way. 



Q So '83, '84 or '85 would be the period in which 
this severence would have occurred? 

A Yes, sir. 

you know that^^^^^^^^^^^^^had a 
relationship in '84 with Ghorbanifar? 

A I knew that he had a relationship with 




Q ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^Hin your 
earlier testimony you said Mr. Ghorbanifar had SAVAK 
connections? 

A Yes, sir. 

Q Did you mean he was an asset of SAVAK or an 
employee in the civil service end of SAVAK? 

A I really don't have that information. I knew 
he was connected with SAVAK. 

Q Do you know whether No. 1 and Ghorbanifar had 
any kind of relationship? 

A I don't know. I doubt it, but yet it is 
possible. 

Q Let me direct your attention, if I may, back 
to your efforts to open the second channel. I gather that 
that effort came at eibout the same time you were reorganizing, 
as is evidenced by Exhibit 8, the companies that you 



IMASMfioASSinED 



825 



UttCUii^tRitex, 



"!!» 



185 



1 collectively describe as the Enterprise, is that correct? 

2 A Well, I recall my establishing the second channel 

3 to be sometime around July; that is to the best of my 

4 recollection. This, I think, we somehow worked out the 

5 date as to when we established that to be also about — my 

6 point of reference for this is the engagement of Eric 

7 Zucher as an employee, and I am estimating because he 

8 worked for us -- it was in the summer, so it should be 

9 about the_ same time . 

10 Q You were earlier referring in yoxir testimony 

11 to this, and you were pointing to Exhibit No. 8, is that 

12 correct? 

13 A Yes. 

14 Q If I recall your testimony correctly, you 

15 first placed Exhibit No. 8 in the context of your having 

16 realized that there had reached a point where the Enter- 

17 prise ^as going to be more than a day-to-day thing, is 

18 that correct? 

19 A That is correct. 

20 Q I think that you connected that insight on 

21 your part with your understemding that you were going to 

22 make an effort to develop a separate second channel 

23 independent of Mr. Ghorbanifar, is that correct? 

24 A That, 1 believe, was already on its way to 

25 occur. The answer is_yes^ JP^ answer_ is correct, yes. 



UNCUSSIEIEIL 



SIFIED 



826 



IIIMSPET 



186 



1 Q Now, when you undertook to open the second 

2 channel, I gather from your testimony you did that at the 

3 direction of General Secord, is that correct? 

4 A That is correct. 

5 Q Now, when you went to open up the second channel, 

6 I gather from your testimony that you had a meeting with 

7 No. 1 sometime in July, is that right? 

8 A I don't recall if I had a meeting with him or 

9 I was doing this over the phone. I can't remember now. 

10 Q Let me ask you something that perhaps may 

11 refresh your recollection. Do you recall meeting with 

12 No. 1 with George Cave? 

13 A Yes . 

14 Q How did that meeting come about, to the best of 

15 your recollection? 

16 A I believe — I think I also testified to that, 

17 that I wanted him to go through a lie detector test. 

18 Whether that occurred in July — I didn't want him to be 

19 exposed before I was completely satisfied that he was 

20 clezui for our purposes. So I asked him to come to the 

21 States and asked him to take a lie detector test. I 

22 don't remember whether it was in July. 

23 Do you have anything that — I got them to 

24 meet, but I don't know which one occurred first. He came 

25 here, took the test, and then met with Mr. Cave or it 

:lassified 



test, and then me 

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happened at the same time. 

Q Let me just ask you this. I am going to show 
you something that will refresh your recollection, I believe. 
But whenMr. Cave and this fellow who has been identified 
as No. 1, when they ultimately met, do you recall whether 
anybody other than those two were present? Were you 
prese-'t? 

A When I introduced them? 
Correct. 

That is obvious. 
Anyone else? 

I don't remember. It is possible that Mr. 
Secord was there. Mr. Robinette assisted me to get him 
to take the test. 

Q How did he do that? 

A He went to approval , someplace that he drove 
us 10 minutes away from our office. 

Q That is the STTGI offices? 

A Yes, Mr. Robinette took me to an ex-government 
employee who does this. I was told that he was an 
ex-government employee. 

Q Let me see if I can understemd this polygraph 
test better. 

I gather it was your feeling that it would be 
to the benefit of No. 1 if he were subjected to a 



It No. 1 ir ne were subiected 



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polygraph test? 



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and I just wanted to make sure that he has no connection 
with the people, and when we satisfied ourselves, I believe 
the CIA, to irt&ke doubly suae he is not engaged with them. 

So it 

was really for his protection, our protection — I like, 
whenever possible, to do things right. 

Q I'm going to show you what has been marked 
Deposition Exhibit No. 26. 

(Deposition Exhibit No. AH-26 
was marked for identification.) 
BY MR. WOODCOCK: 
Q I am going to ask you if you would direct your 
attention in particular to the last paragraph of that 
document . 

You have had an opportunity to review Deposition 
Exhibit No. 26, is that correct? 

A You focused my attention only to the last 
paragraph. 

MR. JANIS: Read the whole thing, not just 
the last paragraph. 

BY MR. WOODCOCK: 
Q Now, I _<ldtlier ^oiL have read the entire document. 




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189 



is -that correct? 

A Yes, sir. 

Q You were asked earlier questions by Mr. Liman 
with respect to the provisoti^ of medical supplies to 
Iran. Do you recall those questions? 

A Yes, sir. 

Q At that time you described the medical supply 
enterprise that you were embarking upon as being something 
that was separate from the development of the second 
chemnel, is that correct? Strike that. Let me rephrase 
that. 

You described the medical supply enterprise 
with Iran as being something separate than a U.S. 
Government interest in the second channel, is that correct? 

A What I tried to describe was that I supported 
a penetration into Iran through supply of medical business 
in Iran. I said that was a good way to get into the 
Iraniem network quickly, efficiently and gain some credit. 

Q That is really what I'm driving at. I'm trying 
to clarify this point. 

Much earlier in your testimony you testified 
that you believed that the best way to enter Iran was 
through commercial means, is that correct? 

A I still believe so. 

The medical enterprise you are describing 



830 



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190 



1 would be one way of doing that, is that correct? 

2 A That is correct. 

3 Q The entry into Iran would benefit a businessman 

4 and the Government of the United States if the Government 

5 of the United States were associated with that venture, is 
o that correct? 

7 A That is correct. 

8 Q Is it true that at this point, July 11, do 

9 you see the medical enterprise as something that could 

10 join with your effort to benefit the United States through 

11 opening a second channel? 

12 A Yes. As a matter of fact, I cun still pursuing 

13 it now. 

14 Q When you say that you are still pursuing it 

15 now, you are pursuing it both for your own benefits and 

16 for possible benefits to the United States, is that 

17 correct? 

18 A I have no idea what the United States ' plans 

19 are. I eun doing it strictly as a private businessman. 

20 Q At this point, you were pursuing it both for 

21 the benefit of yourself and possibly the United States, 

22 is that correct? 

23 MR. LIMAN: At which point? 

24 BY MR. WOODCOCK: 

25 < 



July 11th 



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Yes. 




191 



^^fSD 



Q You met with the second channel on August 25, 
1986, in Brussels, Belgium, is that right? 

A We met with the so-called, a relative, yes. 

Q Now, Brussels is a large transshipment point for 
medical supplies to Iran, isn't that true? 

A I believe that is — what is it. Exhibit 7 that 
dealt with the telexes in connection with the medical 
supplies. I believe if we ex2unine that it is Brussels 
and that is where they are headquartered, yes. 

Q By that time had you actually sent any medical 
supplies to Iran? 

A No. 

Q When you met with the second channel in — on 
September 19 and 20 in the area of Washington, D.C., I 
believe in thelsTTGI offices, had you by that time sent 
any medical supplies? 

A No, sir. 

Q When the TOW shipment was sent out in early 
November of '86, did three pallets of medical supplies go 
with it? 

A Not to the best of my knowledge. 

Q There were discussions, however, that three 
pallets of medical supplies would be sent out at approxi- 



mately that time, is that true? 



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192 



"A According to the agreement, the 9-point agreement, 
I think it was to be sent — if we can refer to that, 
I think it was the next step, if I cun not mistaken. 

It is clearly stipulated in the 9-point agreement 
as to when those pallets should have been sent, 

Q Were those to be sent through a company of yours or 
through the U.S. Government? 

A It was supposed to go together with the weapons. 

Q Do you know whether at any time Lieutenant Colonel 
North would have been under the impression that medical 
supplies were being provided to Iran in the fall of 1986 
that would have been coming from your organization or from 
one of your companies rather than the U.S.? 

A By then, the second channel was opened, and there 
was no longer a follow-up on my original scheme of which 
I had started with that group, referring to Exhibit 7, is 
it — see, I started — the telex and so forth. 
MR. WECHSLER: Exhibit 7. 

THE WITNESS: I Started with my scheme of penetration 
and before I had a chance to completely develop that, the 
disappointment with channel 1 occurred. So, we had to short- 
cut and go to the second channel and not any longer pursue 
my scheme of medical and hospital supplying. •" 

So, when the pallets got ready, and at the same time 
channel 2 was opened, and then at the same time the 9-point 



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833 



uueassfflsii 



^^^ffso 



193 



1 agfeeinent was reached, so it was going to go as part of the 

2 U.S., if you will, gift to the Iranians. 

3 BY MR. WOODCOCK: 

4 Q So, at that point there would have been no under- 

5 standing that these medical supplies would heive been coming 

6 through one of your companies; is that true? 

7 A The Iranians would have understood that it would be 

8 coming from the U.S. Whether it would go through my 

9 companies or not, their understanding was that it was a gift 

10 from the U.S. Government. 

11 Q Let me turn back to deposition Exhibit. No. 8. 

12 In your earlier testimony, you said that the three 

13 continental divisions there — South America, the Middle East, 

14 and Africa — included Africa because of the possibility 

15 of some operations in Angola; is that true? 

16 A I believe what I testified was that I heard — 

17 overheard Angola mentioned — in this whole process sometimes 

18 jokes and serious matters were mixed, and there was a talk 

19 that if we were successful, who knows, we may go to Angola 

20 next. 

21 Q Do you recall who it was that made that remark? 

22 A It could be out of General Secord and/or Ollie North. 

23 Q I gather you took the joke serious enough to at 

24 least make room for it on the chart; is that true? 

25 A I didn't take it seriously._ I^ have seen so many 




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abnormal movements that I wanted to be ready for it. 

Q Do you recall in September of 1986 entering into 
disucssions with Charles Allen with respect to an attempt by 
the Iranians to purchase TOW missiles through' 

A I know I had -- this is a face-to-face meeting you 
are referring to2 

Q I believe they are telephone conversations. I don't 
know whether it involves a face-to-face meeting, as well. 

A That makes more sense, because I had only one 
face-to-face meeting with Mr. Allen, and then a lot of 
telephone conversations with him- 

And the conversations related to the' group that 
I still believe had to do with the first channel that was 
trying to discredit us by saying t^hat they had TOW missiles 
packed, ready to be shipped, and there was an Iranian in 
^^^H who apparently had the mission through a different 
faction to provide these TOWs, and we were pursuing that. 

Basically, if there is any conversation, telephone 
conversation between Charley and I, I have been giving him 
information to follow up so we could understand where we 
were going. 

Q Now, I gather when you say that this was the group 
that supported the first channel, you are speaking of a 
political group within Iran; is that true? 

A No, I am talking about Mr. Ghorba n J A ltfl lW <^ ^^^ gang. 




^nm' 



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195 



^ ' Q I gather they had some connections with people in 

2 Iran; is that true? 

3 A My understanding was that while we were — what is 

4 the date of this? 

5 Q This would be approximately in September of 1986. 

6 A I believe by then they had swelled this -- channel 

7 one being Ghorbanifar — that something was going wrong for 

8 them. 

9 Q This is whom? The people in Iran? 

10 A No, Ghorbanifar. 

11 Q You are saying that by this time Ghorbanifar 

12 had figured out that he was having problems because you had 

13 developed an alternate, a better channel? 

14 A He felt things. There is a wholel 

15 and a story about this^^^^^^^^^H If I would want to 

16 talk about that it would take a good 15 minutes. 

17 Q I am not interested in that. 

18 A There is a relationship, in my opinion, between 

19 Ghorbanifar, Khashoggi, ^^Mfi^ and the fellow in Spain 

20 tliat we were trying to follow. 

21 Q Were you concerned that there really was a possible 

22 shipment coming out of^^^^^or did you think it was all 

23 made up? 

24 A I was being told that it was all made up and the 

25 purpose was to discredit channel 2. 



MMJiSSil^' 



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You referred just a Doment ago to 




that 



entered TOW transaction 




centered on this 

how do you know there wer 



A I asked Charley to do it. 
Q You asked Charley to seek! 





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BY MR. WOODCCXTK: 



'%i5) 



197 



Q Did you and he then discuss the results of the 



A I don't know whether he discussed it with me or 
with General Secord. Mostly it was a one-way communication 
with Charlie, I give him the information, whatever the results 
of the investigation would be would go into th.jir system. 

Q How did you happen to meet Charles Allen? 

A I believe this telephone number first was given to 
me when George Cave had to leave town and asked me to contact 
him if I had anything that had to go to the CIA. 

Q Do you recall when that would have been? 

A Definitely during the time that I became more 
active and that had to do with the second ch2mnel . 

Q So the summer of 1986? 

A Right. 

Q You say you had one point at which you met him 
face-to-face; is that right? 

A Yea, he came to STTGI. 

Q How did that come about? 

A He had questions or difficulties in — my 
understanding was that he was an analyst 2md he had problems 
in understanding certain events. He came to get my opinion. 
To see if I could figure — I don't remember what the subject 
was — but he wanted to see what was my analysis of the 



lill^»^ 



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838 






CAS-2 1 situation or maybe he used that as an excuse just to meet 

2 me and see who I am. 

3 Q What situation are you talking cibout? 

4 A There were certain things happening with the 

5 project that he wemted to understsmd better. 

6 Q This is the second channel opening? 

7 A Second channel, yes. 

8 Q When you met with the second channel in Brussels, 

9 did you bring up the subject of the proposed joint commission 

10 between the United States and Iran? 

11 A Oh, that ceune much later. 

12 Q Do you recall whether that would have come up in 

13 the context of the meeting in the Washington, D.C. area? 

4 

14 A I believe it was even later. It might have 

15 touched on — we might have touched on it in September, but 

16 I don't remember. But seriously, it was discussed after we hac 

17 further meetings. 

18 Q Do you recall whether it was the second channel 

19 who proposed that idea? 

20 A Who? 

21 Q Was it the second channel who proposed the idea of a 

22 joint commission or did that come from the American side? 

23 A I really don't know how it came about. It could 

24 have been my idea. As I mentioned, after the meetings I had 

25 also an analysis and preparation assignments with the Iranians 



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CAS-3 1 I could have suggested that or it could have ifcin there. Let' 

2 draw a line between the joint effort that I am talking about 

3 and probably the joint effort that you are talking about. 

4 We may be talking about two different things. 

5 Q Whv don't you describe the joint effort that you 

6 are talking about. 

7 A The joint effort that I was talking about had 

8 commercial element in it. There was also discussion that I 

9 think came up in September that had to do with the politico- 

10 military joint effort that they should meet regularly and do 

11 things as such. 

12 Q That is really what I am centering on. This Is a 

13 formal joint commission between Irein and the United States. 

14 A Okay. I am with you now. 

15 Q All right. Do you recall whether it was the second 
1g channel and his side that proposed that or was it the 

17 United States? 

18 A I think it was an evolution. The way it developed 

19 thay said that they cemnot conmunicate without having 

20 secure communication. 

21 Q This is both sides saying that? 

22 A Both sides saying that we need to have 

23 secure communications. That developed into a proposed plan 

24 that there should be a joint commission, committee with 

25 people meeting regularly and even for us to send communication 



840 





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CASr4 1 people from the agencies to sit there and things like that, 

2 just an evolution. 

3 Q Do you recall Mr. North and Mr. Secord and 

4 Mr. Cave at some point being designated as the people who 

5 would represent the American side on that joint commission? 

6 A Yes. ' 

7 Q Do you recall whether the person who is referred 

8 to as number two in Deposition Exhibit number 20, I think 

9 it is, yes — 

10 A Can Z see that? 

11 Q Yes, go ahead. 

12 A Yes. 

13 Q Do you recall whether number two was ever 

14 designated by anyone on the Iranian side as being a 

15 potential member of that commission? 

15 A Not that I recall. To the contrary, I — 

17 Q Your recollection would be that he would not have 

18 been so designated, is that correct? 

19 A Correct. 

20 Q When you testified earlier about being indebted 

21 to persons who had assisted you in opening up the second 

22 channel, was number one and number two 2unong those? 

23 A Partially, yes. 

24 Q When you say "partially", what do you mean by that? 

25 A I also testified that certain maneuvering had to go 



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on in Iran to bring the different factions together. 

Q I see what you are saying, in addition — there are 
people in addition to number one and number two, is that 
true? 

A Yes. 

Q Let me turn now to the subject of number two. Was 
he somebody that you knew in Iran? 

A NO. 

Q Was he somebody that you met following the 
revolution? 

A No — well, the answer is yes, but I met him through 
number one. 

Q Did you have any knowledge of him before you met 
him through number one? 

A No. 

Q And I gather that you met number two in connection 
with the opening up of the second channel? 

A That is correct. 

Q There was a meeting held in Framkfurt on October 29 
aitd 30 of 1986 which according to our records you attended. 
Do you recall that meeting? 

A You say in Mainz? 

Q Yes. 

A Yes. 

Q Do you recall that meeting? r\CO 

Upm.^!HrMRFT 



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lll11iLMi)i)iriLlP^//y/^ 

2 Q How would you describe your role in that meeting? 

3 A I would say I was less active than the meetings 

4 that the "Engine" participated in. The "Engine" did not 

5 participate in that meeting. 

6 Q Do you recall at any time giving advice to North 

7 as to how he should — how he might proceed with his 

8 negotiations with the Iranians? 

9 A I know that I had done that, but I don't know 

10 whether it occurred during this meeting as well or not^ 

11 Q Let me ask you to focus on this particular period 

12 of time, what was your perception of how the hostage problem 

13 should be resolved? 

14 A I did not approve of Colonel North's focusing 

15 on hostages. My suggestion was that you should low key that, 

16 you should not show any interest or hunger in getting the 

17 hostages back because his prime objective at that time was 

18 to support the President in connection or the Republicans 

19 for the elections, and I found that to be counter-productive 

20 atnA, like I said, that is not a good negotiating tactic. You 

21 should low key that and then to the contrary tell them you 

22 are not interested in that. 

i 

23 Q Did you suggest to them any kind of a mechanism that 

24 might be used to address the hostage problem at this time? 

25 A I vaguely remember, but I can't recall what it was. 



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A If you have anything that can refresh my mind, 
maybe Z can see it . 

Q I probably do, but I am not sure 1 can show it to 
you. 

Let me — that is all right. I will drop that and 
turn to another subject. 

When you beceime involved with the negotiations that 
occurred in Frankfurt on February 25, you recall that, 
I gather? 

A This is the first channel? 

Q Correct. 

A Yes. 

Q This is the negotiation in which you appeared in 
disguise? 

A Yes. 

Q You testified earlier I think that you believed that 
you had some photographic representations of yourself in 
disguise; is that right? 

A Yes. 

Q Did you have an opportunity to see whether you had 
those in your records in California or elsewhere? 

A I searched for them without any success, but I am 
almost certain I have it, but there was not enough time for 
me to look for it. I will continue to search for it. 



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