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100th Congress — 1st Session • January 6-December 22, 1987
Senate Report
No. 216
IRAN-CONTRA INVESTIGATION
APPENDIX B, VOLUME 1
DEPOSITIONS
United States Congressional Serial Set
Serial Number 13742
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
Imn-Contra Affair
Appendix B: Volume 1
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
Bnittd 3tattB Senate
SELECT COMMITTEE ON SECRET MILITARY
ASSISTANCE TO IRAN AND THE N1CARAGUAN OPPOSITION
WASHINGTON, DC 20510-6480
March 1, 1988
Honorable John C. Stennis
President pro tempore
United States Senate
Washington, D.C.
Dear Mr. President:
We have the pleasure to transmit herewith, pursuant to
Senate Resolution 23, Appendix B to the final Report of the
Senate Select Committee on Secret Military Assistance to Iran
and the Nicaraguan Opposition. We will submit such other volumes
of Appendices to the Report as are authorized and as they become
available.
Sincerely,
Warren B. Rudman
Vice Chairman
III
U.S. HOUSE OF REPRESENTATIVES
SELECT COMMITTEE TO INVESTIGATE
COVERT ARMS TRANSACTIONS WITH IRAN
UNITED STATES CAPITOL
WASHINGTON. DC 20S15
(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 foF-Yelease 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 McCoUum, Florida
Michael DeWine, Ohio
John W. Nields, Jr.
Chief Counsel
W. Neil Eggleston
Deputy Chief Counsel
Kevin C. Miller
Staff Director
Thomas R. Smeeton
Minority Staff Director
George W. Van Cleve
Chief Minority Counsel
Richard J. Leon
Deputy Chief Minority Counsel
VII
United States Senate
Select Committee on Secret Military Assistance to
Iran and the Nicaraguan Opposition
Arthur L. Liman
Chief Counsel
Mark A. Belnick Paul Barbadoro
Executive Assistant Deputy Chief Counsel
to the Chief Counsel
Mary Jane Checchi
Executive Director
Lance I. Morgan
Press Officer
Associate Counsels
C. H. Albright, Jr.
Daniel Finn
C. H. Holmes
James E. Kaplan
Charles M. Kerr
Joel P. Lisker
W. T. McGough, Jr.
Richard D. Parry
John D. Saxon
Terry A. Smiljanich
Timothy C. Woodcock
Committee Staff
Assistant Counsels
Legal Counsel
Intelligence/Foreign
Policy Analysts
Investigators
Press Assistant
General Accounting
Office Detailees
Security Officer
Security Assistants
Chief Clerk
Deputy Chief Clerk
Steven D. Arkin*
Isabel K. McGinty
John R. Monsky
Victoria F. Nourse
Philip Bobbitt
Rand H. Fishbein
Thomas Polgar
Lawrence R.
Embrey, Sr.
David E. Faulkner
Henry J. Flynn
Samuel Hirsch
John J. Cronin
Olga E. Johnson
John C. Martin
Melinda Suddes*
Robert Wagner
Louis H. Zanardi
Benjamin C.
Marshall
Georgiana
Badovinac
David Carty
Kim Lasater
Scott R. Thompson
Judith M. Keating*
Scott R. Ferguson
Staff Assistants
Administrative Staff
Secretaries
Receptionist
Computer Center
Detailee
John K. Appleby
Ruth Balin
Robert E. Esler
Ken Foster*
Martin H. Garvey
Rachel D. Kaganoff*
Craig L. Keller
Hawley K.
Manwarring
Stephen G. Miller
Jennie L. Pickford*
Michael A. Ray nor
Joseph D.
Smallwood*
Kristin K. Trenholm
Thomas E. Tremble
Bruce Vaughn
Laura J. Ison
Hilary Phillips
Winifred A. Williams*
Nancy S. Durflinger
Shari D. Jenifer
Kathryn A. Momot
Cindy Pearson
Debra S. Sheffield*
Ramona H. Green
Preston Sweet
VIII
Committee Members' Designated Liaison
Senator Inouye
Senator Rudman
Senator Mitchell
Senator Nunn
Senator Sarbanes
Senator Heflin
Peter Simons
William V. Cowan
Thomas C. Polgar
Richard H.
Arenberg
Eleanore Hill
Jeffrey H. Smith
Frederick Millhiser
Thomas J. Young
Senator Boren
Senator McClure
Senator Hatch
Senator Cohen
Senator Trible
Sven Holmes
Blythe Thomas
Jack Gerard
Dee V. Benson
James G. Phillips
James Dykstra
L. Britt Snider
Richard CuUen
Part Time*
Assistant Counsel
Hearings Coordinator
Staff Assistants
Interns
Peter V. Letsou
Joan M. Ansheles
Edward P.
Flaherty, Jr.
Barbara H. Hummell
David G. Wiencek
Nona Balaban
Edward E.
Eldridge, III
Elizabeth J. Glennie
Stephen A. Higginson
Laura T. Kunian
Julia F. Kogan
Catherine L. Udell
Document Analyst
Historian
Volunteers
Lyndal L. Shaneyfelt
Edward L. Keenan
Lewis Liman
Catherine Roe
Susan Walsh
*The staff member was not with the Select Committee when the Report was filed but had, during
the life of the Committee, provided services.
IX
United States House of Representatives
Select Committee to Investigate
Covert Arms Transactions with Iran
Majority Staff
John W. Nields, Jr.
Chief Counsel
W. Neil Eggleston
Deputy Chief Counsel
Kevin C. Miller
Staff Director
Special Deputy
Chief Counsel
Staff Counsels
Press Liaison
Chief Clerk
Assistant Clerk
Research Director
Research Assistants
Charles Tiefer
Kenneth M. Ballen
Patrick J. Carome
V. Thomas
Fryman, Jr.
Pamela J.
Naughton
Joseph P. Saba
Robert J. Havel
Ellen P. Rayner
Debra M. Cabral
Louis Fisher
Christine C.
Birmann
Julius M.
Genachowski
Ruth D. Harvey
James E. Rosenthal
Systems
Administrator
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
Thomas R. Smeeton
Minority Staff Director
George W. Van Cleve
Chief Minority Counsel
Richard J. Leon
Deputy Chief Minority Counsel
Associate Minority
Counsel
Assistant Minority
Counsel
Minority Research
Director
Robert W.
Genzman
Kenneth R. Buck
Bruce E. Fein
Minority Staff
Editor/Writer
Minority Executive
Assistant
Minority Staff
Assistant
Michael J. Malbin
Molly W. Tully
Margaret A.
Dillenburg
Committee Staff
Investigators
Director of Security
Robert A.
Bermingham
James J. Black
Thomas N.
Ciehanski
William A. Davis,
III
Clark B. Hall
Allan E. Hobron
Roger L. Kreuzer
Donald Remstein
Jack W. Taylor
Timothy E. Trayior
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
Courter
Representative
McCollum
Representative
DeWine
General Counsel to
the Clerk
Michael W. Sheehy
Robert H. Brink
Steven K. Berry
David S. Addington
Diane S. Doman
Dennis E. Teti
Tina L. Westby
Nicholas P. Wise
Steven R. Ross
XI
Contents
Volume 1
Preface XXI
Airline Proprietary Project Officer 7
Alvarez, Francisco J 179
Allen, Charles 236
Arcos, Cresencio 1238
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.
Barnett, Ana.
Bartlett, Linda June.
Bastian, James H.
Brady, Nicholas F.
Brown, Arthur E., Jr.
Byrne, Phyllis M.
Calero, Adolfo.
Castillo, Tomas ("W").
Cave, George W.
C/CATF.
Volume 4
Channell, Carl R.
Chapman, John R. (With Billy Ray Reyer).
Chatham, Benjamin P.
CIA Air Branch Chief.
CIA Air Branch Deputy Chief.
CIA Air Branch Subordinate.
CIA Chief.
CIA Communicator.
CIA Identity "A".
XV
Volume 5
CIA Officer.
Clagett, C. Thomas, Jr.
Clark, Alfred (With Gregory Zink).
Clarke, George.
Clarridge, Dewey R.
Cline, Ray S.
C/NE.
Cohen, Harold G.
Volume 6
Collier, George E.
Cole, Gary.
Communications Officer Headquarters, CIA.
Conrad, Daniel L.
Volume 7
Cooper, Charles J.
Coors, Joseph.
Corbin, Joan.
Corr, Edwin G.
Coward, John C.
Coy, Craig R
Crawford, Iain T.R.
Crawford, Susan.
Crowe, Adm. William J.
Currier, Kevin W.
DCM, Country 15.
DEA Agent 1.
DEA Agent 2.
DEA Agent 3.
deGraffenreid, Kenneth,
de la Torre, Hugo.
Deputy Chief "DC".
Duemling, Robert W.
DIA Major.
Dietel, J. Edwin.
Dowling, Father Thomas.
Dutton, Robert C.
Earl, Robert.
Volume 8
Volume 9
XVI
Volume 10
Farber, Jacob.
Feldman, Jeffrey.
Fischer, David C.
Floor, Emanuel A.
Former CIA Officer.
Fraser, Donald.
Fraser, Edie.
Fuller, Craig L.
Volume 11
Furmark, Roy.
Gadd, Richard.
Gaffney, Henry.
Gaffney, Henry (With Glenn A. Rudd).
Galvin, Gen. John R.
Gantt, Florence.
Garwood, Ellen Clayton.
Gast, Lt. Gen. Philip C.
Gates, Robert M.
Glanz, Anne.
Volume 12
George, Clair.
Godard, Ronald D.
Godson, Roy S.
Golden, William.
Gomez, Francis D.
Goodman, Adam.
Gorman, Paul F.
Graham, Daniel O.
Gregg, Donald P.
Gregorie, Richard D.
Guillen, Adriana.
Hakim, Albert.
Hall, Wilma.
Hasenfus, Eugene.
Hirtle, Jonathan J.
Hooper, Bruce.
Volume 13
Volume 14
XVII
Hunt, Nelson Bunker.
Ikle, Fred C.
Jensen, D. Lowell.
Juchniewicz, Edward !
Kagan, Robert W.
Keel, Alton G.
Kellner, Leon B.
Kelly, John H.
Kiszynski, George.
Koch, Noel C.
Kuykendall, Dan H.
Langton, William G.
Lawn, John C.
Leachman, Chris J., Jr.
Ledeen, Michael A.
Leiwant, David O.
Lilac, Robert H.
Lincoln, Col. James B.
Littledale, Krishna S.
McDonald, John William.
McFarlane, Robert C.
McKay, Lt. Col. John C.
McLaughlin, Jane E.
McMahon, John N.
McMahon, Stephen.
McNeil, Frank.
Makowka, Bernard.
Marostica, Don.
Marsh, John.
Mason, Robert H.
Meese, Edwin IIL
Melton, Richard H.
Merchant, Brian T.
Meo, Philip H.
Miller, Arthur J.
Miller, Henry S.
Miller, Johnathan.
Volume 15
Volume 16
Volume 17
Volume 18
XVIII
Miller, Richard R.
Motley, Langhome A.
Mulligan, David P.
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., II.
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).
Volume 24
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., IIL
Smith, Clifton.
Sofaer, Abraham D.
Steele, Col. James J.
Taft, William H., IV.
Tashiro, Jack T.
Teicher, Howard.
Thompson, Paul.
Tillman, Jacqueline.
Volume 25
Volume 26
Volume 27
Thurman, Gen. Maxwell.
Trott, Stephen S.
Tull, James L.
Vessey, John.
Walker, William G.
Watson, Samuel J., IIL
Weinberger, Caspar.
Weld, William.
Wickham, John.
Zink, Gregory (See Alfred Clark).
XX
Preface
The House Select Committee to Investigate Covert Arms Transactions with Iran
and the Senate Select Committee on Secret Military Assistance to Iran and the
Nicaraguan Opposition, under authority contained in the resolutions establishing
them (H. Res. 12 and S. Res. 23, respectively), deposed approximately 290
individuals over the course of their 10-month joint investigation.
The use of depositions enabled the Select Committees to take sworn responses
to specific interrogatories, and thereby to obtain information under oath for the
written record and develop lines of inquiry for the public hearings.
Select Committees Members and staff counsel, including House minority
counsel, determined who would be deposed, then sought subpoenas from the
Chairmen of the Select Committees, when appropriate, to compel the individuals
to appear in nonpublic sessions for questioning under oath. Many deponents
received separate subpoenas ordering them to produce certain written documents.
Members and staff traveled throughout the United States and abroad to meet
with deponents. All depositions were stenographically reported or tape-recorded
and later transcribed and duly authenticated. Deponents had the right to review
their statements after transcription and to suggest factual and technical correc-
tions to the Select Committees.
At the depositions, deponents could assert their fifth amendment privilege
to avoid self-incrimination by refusing to answer specific questions. They were
also entitled to legal representation. Most Federal Government deponents were
represented by lawyers from their agency; the majority of private individuals
retained their own counsel.
The Select Committees, after obtaining the requisite court orders, granted
limited or "use" immunity to about 20 deponents. Such immunity means that,
while a deposed individual could no longer invoke the fifth amendment to avoid
answering a question, his or her compelled responses— or leads or collateral
evidence based on those responses— could not be used in any subsequent criminal
prosecution of that individual, except a prosecution for perjury, giving a false
statement, or otherwise failing to comply with the court order.
An executive branch Declassification Committee, located in the White House,
assisted the Committee by reviewing each page of deposition transcript and some
exhibits and identifying classified matter relating to national security. Some
depositions were not reviewed or could not be declassified for security reasons.
In addition, members of the House Select Committee staff corrected obvious
typographical errors by hand and deleted personal and proprietary information
not considered germane to the investigation.
In these Depositions volumes, some of the deposition transcripts are follow-
ed by exhibits. The exhibits— documentary evidence— were developed by Select
Committees' staff in the course of the Select Committees' investigation or were
provided by the deponent in response to a subpoena. In some cases, where the
number of exhibits was very large, the House Select Committee staff chose for
inclusion in the Depositions volumes selected documents. All of the original
XXI
exhibits are stored with the rest of the Select Committees' documents with the
National Archives and Records Administration and are available for public in-
spection subject to the respective rules of the House and Senate.
The 27 volumes of the Depositions appendix, totalling more than 30,000 pages,
consist of photocopies of declassified, hand-corrected typewritten transcripts
and declassified exhibits. Deponents appear in alphabetical order.
XXII
Publications of the Senate and House
Select Committees
Report of the Congressional Committees Investigating the Iran-Contra Affair,
1 volume, 1987.
Appendix A: Source Documents, 2 volumes, 1988.
Appendix B: Depositions, 21 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
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EXECUTIVE SESSION
DEPOSITION OF |
Friday, June 12, 1987
U.S. House of Representatives,
Select Committee to Investigate Covert
Arms Transactions with Iran,
H "^ 1 I o - :^ ^\£. .1
Washington, D.C.
40-^"^
The committee met, pursuant to call, at 1:10 p.m.,
in Room B-352, Rayburn House Office Building, Patrick
Carome (Staff Counsel of the House Select Committee)
presiding.
Present: Patrick Carome, Staff Counsel, House Select
Committee; Timothy Woodcock, Associate Counsel, Senate
Select Committee; and David Pearline, Counsel, CIA, represent
ing the witness.
under cio\rttlonl rf E-0. 12? 5
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Whereupon ,
was called as a witness by Counsel for the House Select
Committee, and having been duly sworn, was examined and
testified as follows:
EXAMINATION BY COUNSEL FOR THE SELECT COMMITTEES
BY MR. CAROME:
Q ^^^^H^^^H just for the record, I am Patrick
Carome, I am staff counsel with the House Select Committee
to Investigate Covert Arms Transactions with Iran. Also
present is Tim Woodcock, an attorney with the Senate Select
Committee looking into the same matters.
Our committee has been set up pursuant to the
resolution and rules which I have just given you a copy of
and which the CIA has been earlier provided copies of these
rules. This deposition is being conducted pursuant to these
rules.
UNCLASSIFIED
UNcimEFT
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Q But it was beginning June, 1985 that you became
Project Manager with respect to^^H^^IH^^^^^^^H is that
right?
A Right.
l/NCUSSIflED
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im^ffl^T
A In other words,]
answered to me on financial matters and what
we were doing and so forth, and then I would give him in-
structions from our side.
Q And when you say "from our side", you mean the CIA
is that right?
A Yes, right.
0 Who withir^^^^^^^^^^^^B did you deal with as
project manager for|
A Primarily the Branch Chief or Deputy Branch Chief
Q So I get a better idea of these people, the Branch
Chief, during 1985, ^^^^^KKjK^^Kt ^^ ^^^^ correct?
A Yes.
Q And the Deputy Branch Chief during 1985 —
A
Q Was
A Right.
Q And the^^^^^^^Bsection Chief — is that what
you said?
UNflASSm.
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Q And the position held by^^^^^^^^H toward the end
of 1985 was essentially the same position that you held!
Q The primary timeframe that I am interested in
talking to you about today is really the second half of 1985.
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Q I take it that^^^^^^^B during the time I am
talking about, the second half of 1985, performed both
straight commercial operations and special operations at the
behest of the United States Government, is that right?
A Yes.
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Okay. I take it that your primary contact with the
[proprietary was^^^^^^^^^^^^^^^f is
A Right.
Q Was all of your contact ^^th^^^H^^H through him?
A Right.
Q Did you ever speak directly with crew members and
pilots, et cetera?
A Not during that timeframe. Probably in January --
sorry, March of '86 would be the first time that I had a
daily contact with crew members and actually flew on some
flights and had a chance to meet the people individually.
Now, during the first six months I had met a few
people, I had met them in the office as the result of being
in the office and passing through the office, but not daily
contact.
IIUPI AttlFIFfl
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IWCiASSiaES'
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Q When you say office, what office are you referring
to:
^^^^Hf^^^l^l of f ice , the officel
itself, and the -- we didn't have an office
se, but our aircraft was based^^^^^^^^^^H so I met the
crew there.
Q I take it that you worked out of an office'
is thai right?
A Right.
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Q When^^^^^^^Hperformed straight commercial cargo
carries, what type of information or what type of contact
would there be between^^H^^^^Band you?
A Other than keeping track of what we were doing or
trying to keep track of what we were doing so that I would
know where the aircraft were, the flyable status of the air-
craft, he had the authority and in fact did contract the air-
craft and run that schedule. I didn't know on a daily
basis who we were flying for that day necessarily or where
the aircraft was going, except we did have a recurring con-
tract f^^K^H^^^B that we flew most of the time, hauling
^■freight and one thing or another.
So I didn't get involved in that except to try to
personally keep myself abreast of where the aircraft were
located in case a requirement come up that we had to fulfill,
and the flyable status of the aircraft. We had an agreement,
we operate I shou»l<t say beyond even an agreement. He had
the authority to accept any commercial contract and fly that
aircraft without notifying me as long as it didn'tl
[and that type of stuff, and if he had an
offer to do so, then he would call me, and we would get
clearances, or I would get clearances, I should say more
correctly.
Q
Iran was
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considered one as well.
Q And these are countries that it is particularly
sensitive for a U . S . -associated company to fly into, is that
right?
A Right. Even though we were not U.S. associated ,^B
We do have, you know, in fact, we owned the air-
craft and so forth.
Other than^^f^^^^^^^^H, were
there any other restrictions on^^^^^^^^^Hability to
accept a contract for a flight?
THE WITNESS: Other than practical, no. In other
words, he would have to justify later as a fact why we would
have taken a flight.
MR. WOODCOCK: How about cargos?
THE WITNESS: Cargos , no, except to be legal. In
other words, he is not obviously going to be, what would
you call it, smuggling or that type of stuff. It would be
legal, contracted type flights. He wouldn't have the
authority to go out and personally generate a load somewhere
and transport it. As long as we were hauling for someone
else under a contract or a trip contract type thing.
BY MR. CAROME:
Q He could, for example, contract to perform a ship-
ment of military equipment or armaments without having to
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double check with you, is that right?
A Depending on the destination, yes.
Q It is the destination that drove whether or not he
had the authority?
A And who we were flying for, yes.
Q And what do you mean by "who we were flying for"?
A As an example, any time he flew for -- there was
like one broker, we knew any time we flew for that one --
because they were kind of known as arms dealers worldwide --
so even though it would be, say, fron^^^^^|or somewhere,
something, he would advise me of that flight
^^—,—^^^^^^^^-,^^ to let us know this was in fact
going on.
And I think you have a copy of some of his reports
where he reported flights for Iran previous to this time-
frame we are talking about thatjhe had picked up from these
people .
Q What was the normal method of communications
between you and CIA and between you and
when there was a need f^^^V^^^H^^Hto
perform a special flight on behalf of the U.S. Government?
A It would vary depending on the urgency, obviously.
A lot of it was by commercial telephone and talking around
as much as we could. A lot of it would be, I would get a
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phone call^^^^^^^^^Hfor a briefing and would actuallyl
^Hand physically get the briefing and then go back and
relay it back to^^^^^^^Bor to actually implement the thing.
Q Normally what would take place, I take it, is that
someone at CIA would call you up and say "We have a task
for^^^^^^^H to cai^^^^^^^Bj do Is
A Right.
Q And who would normally be the person to make that
phone call to you?
A One of the three: the Branch Chief primarily,
or his deputy, and then^^^H. In this case, you are interests
in what was probably the first one that we worked with^^^B
directly, and that was with he and the Branch Chief the same
night, same weekend.
Q You are referring to the November, '85 shipment,
is that right?
A Right. But most of my flights would come directly
from the Branch Chief, or at least notification of it would.
Q That would either be -- that would usually start
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with a phone call to you, is that right?
A Yes.
Q And depending on how quick things had to happen,
you handle i^^^^^^^^^H' ° ^ ^^^^H^^^I^^^H
^^■CIA Headquarters, is that right?
A Right.
Q And what about the communications between you and
how would those work in this special flight area?
A Either by telephone or, based on sensitivity,
face-to-face with^^^^^^^^f I would either go to his place,
or he would come to mine for a face-to-face briefing if the
time allowed, or if circumstances allowed. Otherwise, it
was by telephone.
MR. WOODCOCK: I ]ust want to establish, for the
record, when you say^^^^^^^V you are referring toj
THE WITNESS: Right j
BY MR. CAROME:
yes, right.
Q And when a tasking came down from the Central
Intelligence Agency, did you instruct^^^^^^^^^^^H that he
would do this, or would you ask him, "Do vou want to do this
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CIA tasking?"
A It would be more of an instruction with, obviously
taking his advise and counsel as to safety and whether we
should do it or not, but it would be in the form of orders,
if you will, saying, "This is the flight", you know, "Do
it" and "How do we do it" and whatever. It wouldn't -- not
a cold block order, saying, "Do it" and no if s, ands or buts,
if he had a concern about saf ety^^^^^^^| or whatever, that
wold obviously be entertained and the flight would, you know,
take that -- go and take that into consideration. We never
did not do a flight because he said he didn't want to do
it or anything of that nature. So that was the point I was
trying to make.
Q Okay.
A Fortunately, v;e never ran into that situation where
he said, "I won't do it" or "We can't do it", or whatever.
Q But the flow of authority or command was from you
down to him, is that right?
A Right.
Q How many times, to your knowledge, has
flown to Iran?
A Twice. Two flights.
MR. PEARLINE: In what time period?
MR. CAROME: I guess I am talking about your total
THE WITNESS: Twice.
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MR. PEARLINE: Okay.
BY MR. CAROME:
Q Which two times are those?
A We did a strictly commercial flight in August,
1985. Then we did a second flight in November, 1985.
Q And just to refresh your recollection, I believe
that there was also a flight, at least one flight, into Iran
in May of 198 -- sorry, I withdraw that question. My con-
fusion .
A The August, 1985 flight, you understand, was not
an agency flight.
Q Why don't you tell me what that flight was?
A That wasi
you know, that we found out after the fact. We knew at the
time we booked the flight that it was supposed to be^^^fH
[received a request for flight, as we have
several others other than that one, and relayed it to me
that a brother had approached him to make this flight. It
was a J
and at that time I was told
and possibly ^^^^^^^^Bl had something to put
on board the flight. We made a pickup — the flight was
scheduled to pick up in^^^^^^^^HH ^^ fact, we did pick
up^^^^^^^^^^^^^^l he gave me the details of the flight,
I reported them to Headquarters and asked approval to make
iMAssra.
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Who did you make the report to at Headquarters:
To|
Did he tell you, you made that report by telephone:
Yes.
And did he tell you on that phone call, "Yes, go
1 the flight
2 We got approval to make the flight, and, in fact
3 did
4 Q
5 A
6 Q
7 A
8 Q
9 ahead"?
10 A' No, it was, in fact, a couple days later before I
11 got the clearance to go ahead and make the flight. As a
12 matter of procedure, when some of these flights come up,
13 we would continue to negotiate the flight,
14 structions were to not turn the flight off in case we
15 decided we wanted to make the flight, but always leave an
15 out, so we would not have to make the flight in case I got
17 a "no responssj"./ In this flight, I got a "yes" response.
18 Q And that, again, came bj
19 by phone?
20 A Yes.
21 MR. WOODCOCK: Was there any report of that
22 consultation process that was put down in writing?
23 THE WITNESS: Not during that time.
24 made a report to me, and I think I made a comment in one of
25 my weekly or monthly reports to^^^^^^^^^^^^ In fact,
my weekly or monthly reports toj
liMPiAccinrn
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'' I remember turning in a copy of the flight manifest that
2 ^^^^^^^Hhad provided to me.
3 BY MR. CAROME:
4 Q How did you learn that some of that material
5 originatei
6 A As it turned out -- this is from^^^^^^^f his
7 verbal to me, which he had gotten from the brother that
8 this is where the cargo was supposed to have come from. As
t o^^^^H^^^^^^^^^^^^H s t u f f
10 didn't show up, so to be able to say exactly where the cargo
11 came from I don't think we can do so.
12 But his was verbal from the brother to him, and
13 then to me.
14 Q Okay.
15 A I think the only thing I can remember, and you are
16 stretching it for a year-and-a-half , is part of the documenta
17 tion showed some|
18 which I remembered recognizing.
■)9 Q Did you play any role in that August, 1985 business
20 coming to'
21 A No
22 Q It came t'
23 A Right
24 Q Were there]
25 let's say, prior to November, 1985^^^^^^|cargo shipments
Mim
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into Iran that you know of?
A Yes. I received a call, and later I got it in
writing, and there is a question in my mind as to when I
actually got it in writing, I think it was after the November
flight when I finally received a memo of^^^H^^^^^^ dated
do ^sc^H m^^^^ii^^^^^p^^^^^^^^^^^^^^i3
flights or 13 loads from^^H^^^to Tehran. And this was
more for information
Q I had understood fr
yesterday that this
^^^HJoccurred sometime in November, 1985. Is that consistent
with your recollection?
A Yes, that is consistent. His memo — and I don't
remember the exact date -- his memo was like three days
prior, three or four days prior to the time that we entered
into the, the 23 I think it is of November flight. I think
his memo was dated the 19th or 20th of November.
But preceding the memo was a phone call, and then
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later I got the memo. Like I say, I don't think I had the
memo at the time we currently discussed the flight.
Q Just so the record is clear, with respect to this
lyou recall receiving a phone call from
have m^l^^^^^^^^^^^^^B these from
|to Iran", is that right?
A Right. And it wasn't a specific phone call for
that subject. It was mixed in among some other reporting.
Normally he would give me information by phone and would
follow it up with a memo that, because of the mail or because
he would hand carry it to me a few days later so we probably
discussed other things as well, was not a specific phone
call saying "I received that one flight"; that was the extent
of it. It may have other business matters as well.
Q That was part of a general report to you?
A Right.
From^^^^^^^^^^^ is
A Yes.
Q And he would periodically make such reports, is
that right?
A Yes.
Q How often would he do that?
A We would talk at least weekly, sometimes daily,
depending on what activity were going on, both financial,
commercially or officially.
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Q And he would follow those phone calls up with
rnemorandums, is that right?
A Sometimes, most of the time. He should have in
most cases, yes. But there was obviously gaps where he
wouldn't do that.
Q And what do you recalJ^^^^^^^^^^B telling you
t h i ^^^^^^^^^^B s h i pme n t^^^^^^^^^^B t o
A Basically, what -- at that time, basically what I
had told you, until I got the call on the flight that we
finally did do, when I first described the flight to him,
he said, "That sounds like the same flight that I told you
about earlier," and I said, "No, the destination is wrong,
and I don't think it could be that."
And then we dropped it, and that was the extent
of the reference to that period.
Q All right. Could we go off the record for a
second.
(Discussion off the record.)
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HNt^SSIPKS'^
24
MR. CAROME: Let's mark this as Exhibit^^-1
[The document marked Exhibit No.^^k-1
follows : ]
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MR. CAROME; ^^^^^^^m I am putting before you
what has been marked as Exhibit 1. I ask you if you
recognize that to be a November 21, 1985 memorandum from
■ to you?
THE WITNESS: Yes.
BY MR. CAROME:
Q recognize as^^^^^^^^^^^^Hmemo,
even though it doesn't bear his name on it, is that right:
A Yes.
Q I have a couple of questions about this Exhibit
1. First you will note on the first page that there are
several paragraph items and a couple of them have been
blacked out and paragraph 3 is one which has been blacked
out. I have seen an unredacted version of that document
and I know that paragraph 3 deals with]
^several flights]
to Iran.
Are you familiar with the test of that paragraph?
A I haven't seen it for a while, but yes, that is
the memo I was referring to. Like I say, the date was the
21st. I don't think I had this on 23rd at the time
lasked me the question is this the same flight,
but he at that time reported to me verbally the report.
He referred to in his After Action Report or whatever that
this is the flight I referred to you earlier and I said
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no, I don't think it is.
Q Did^^^^^^^^^^^B tell you when you talked to
him the first time about this.
A I don't remember. I don't remember that coming
into it, no.
Q Paragraph 3 in its unredacted form states that
the nature of the cargo was I
believe munitions or armaments of some sort. Is that how
described it to you in the telephone call?
A Yes..
Q So you knew that that was a shipment of military
armaments or munitions, is that right?
A Yes.
Q Did ^^^^^^^^^^1 ask I
A No. 1
In fact I think he was reporting it more
as a "This has been on the street for a week
27
UNsmssieEK'
I which was involved!
A I would almost say^^^^^^^^^^^^^H rather than
or something to that effect. I don't
remember seeing this recently but I think it was!
Q Is that an airline company?
A Yes, to my knowledge it is. I am not familiar
with the company but to my knowledge it is^B^^^^^^Hair-
line or some airline doing business
Q.
Q I^ic^^^^^^^^^B^Bfl ^^^-^ y°^ that while the actual
nature of the cargo was armaments or munitions, it was
being billed on the market as medical equipment?
A I don't think so. I don't remember that coming
Q Before we move forward in time, I want to ask
you, do you know prior to the matters we have already been
talking about, were there other offers that]
received to perform flights into Iran?
A Durin2_my_ tijie^-^Qfi'^ ^,<^%^t know prior to
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June '85. The first one I have memory of is the one
in August that I got approval for us to do. In fact I
felt good that we had gotten approval to do, that was what
we were supposed to be out there doing anyway. To my
memory that was the first one that we had been approached
or at least he told me that he had been approached to do
and we went in and got approval to do.
Q We have been told at some point and I don't
remember the details precisely that there was an offer made
to^^^^^^^^l to fly believe|^^^^^^^^^^^^^^^Hto Iran
at some point. Are you aware of such an offer?
A I don't remember the word^^^^^^^^^f I remember
that we did have an offer or in fact we started out to
do a f light ^^^^^^^^^1 I believe, somewhere |
in January of '86. In fact he gave me the flight.
I just don't remember the word |^^^^^^^^^-- he gave me
the flight as a proposal, I submitted it to Headquarters
tc^l^^^^^^^^Und for some reason they weren't as respon-
sive on this one as they had been previously. In fact
I had to bug them a couple of times because we were getting
close to the time we had to move the aircraft to do the
f fight. This stretched out over a couple of days. We
finally got to the point where we had accepted the money
to do a flight and had to move the aircraft. We had a
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fuel and crew rest stop scheduled^^^^^^^^^^^H x got
approval to proceed that far and not let the aircraft
proceed further until I had approval from the Agency.
After arrival of the aircraft prior to the scheduled
take-off of the aircraft, I finally got a phone call from
[saying we were disapproved for
the flight.
Q Did he say where the disapproval came from?
A I didn't ask, but normally the DO staff. In
fact at that time we were talking onj
Q Was this an opportunity that came toBS^^M
through commercial channels unassociated with the Agency?
A Yes.
Q Much like the August flight?
A Just like the August flight, right. In fact
if I remember correctly it was from the same broker.
Q Is thati
A Yes.
MR. WOODCOCK: Were you told why the flight
was refused?
THE WITNESS: No.
MR. WOODCOCK: Have you ever learned afterwards
why it was refused?
THE WITNESS: No, I never asked. I told
Iwhy the flight was refused but that was between
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he and I and more to cover our relationship than mine with
the Agency, and that my explanation to^^^^^^H was let's
don't question it, they must know something we don't know,
as far as safety of the aircraft or so forth.
MR. CAROME: You recall that that was — let me
rephrase the question. You don't have a specific recollec-
tion of whether that was^^^^^^Hon that flight, is that
right?
THE WITNESS: I don't remember there were]
no. I knew that it was^^^^^^^^fof some sort or at least
we understood that that was what it was, and I don't
recollect him saying to me^^^^^^^f per se.
BY MR. CAROME:
Q Let's go back to Exhibit 1 for a moment.
Paragraph 4 is headed Tehran Situation. Can you explain
to me what that item is in this report?
A He was reporting to me a flight that had taken
place to Tehran that he had apparently gotten from
lor one of the brokers there and how the flight
was conducted and the fact that they were escorted by
fighter aircraft. That he found interesting, that that
had transpired.
Q And I take it there is no question in your
mind that that was not a flight performed by^
A No, I know it wasn't, or I feel like I know it
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wasn't I should say. In fact that question did come up
later that could he have possibly made this flight, as
somebody could have misread it, that maybe he made the
flight and didn't report it or we didn't get approval for
it. I went back into my files and was able to satisfy
myself that our aircraft in fact was in the paint shop
at that time. I didn't physically see it there, but I
bought the paint and we were out for a period of time,
that we were satisfied thatim^^^did not make a flight.
Q I gather that you checked into that matter
in late '86 when this same question came up?
A Right.
Q And you provided^^^^^^^^^f with some records
substantiating the account that the plane appeared to have
been in a paint shop at the time?
A Right.
Q Could you describe how the second Tehran flight,
this is now the November '85 flight that^^^^M^^did
perform, how that matter came to your attention and
what happened when it did?
A I received a call late afternoon, early
evening the 22nd, I guess it was a Friday afternoon or
evening, whatever day of the week it was.
Q Perhaps to assist you let me --
Please
iiKipi ACQinrn
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liNttJI^iPIST
32
Q 1 Q __ put before you an exhibit that deals with
2 this matter.
3 MR. CAROME: Could you mark this as
4 Exhibit 2,
5 [The document marked Exhibit No .^^^2 follows:
6
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inwHSSi^T
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BY MR. CAROME:
Q l^^^^^^^^^k I am putting before you what the
reporter has just marked as Exhibit 2 and I ask if you
recognize what that is?
A Yes.
Q What is it?
A It is some handwritten notes of mine made during
that weekend under question.
Q Were you making these notes as events were
transpiring?
A Yes.
Q Why don't you go back to telling us the story of
how this activity or the need for a flight to be made came
to your attention?
A Okay. I see they have x ' ed out names. Should I
refer to it as this or give the name of the individual.
MR. PEARLINE: Could we go off the record?
[Discussion off the record.]
THE WITNESS: I received a call at 1600 hours
on the 22nd from]
MR. CAROME: Sixteen hundred hours
THE WITNESS: Yes -- requesting availability of
the aircraft for a possible sensitive flight. He gave me
the dimensions of the cargo, c;avgm^-4he pickup and
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destinati
I iiTunediately callet^^^^^^^H to determine the location o£-
the aircraft and flyable status, to which if I could read
it it would refresh my memory -- one aircraft, the
[aircraft was on a flight at that time.
Lone was a leased 707 with a
U.S. registration number, the second was one that we
owned and had^^^^^^^^| registration numbers,]
lit was on a flight at the time.
The in registered aircraft or the U.S. registered
aircraft was on the ground^^^^^^^^^^Kcheduled for a
flight the next mornini^^^^^^^^^^^ I relayed that
information back^^^^^^^^^^^^^I am not sure who that
call was to, either^^^^^^^^^^^^B b^c^use in the interim
I talked to those two indivi^i«als exclusively and sometimes
it would be to^^^^Band sometimes it would be ^°|H^^|'
since both of them were_ war^y-pj^^b^^light .
iiNr.1
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I gave that back to them after a period of time.
It looks like here 1730, about an hour and a half later.
I got a call from^^^^Hin this instance telling me that
we were to do the flight, and that we were to give it to
Iwith the name Richard Copp, that he would be
contacting through the flight and it was in our interest
for him to do the flight, but to handle it as a commercial
flight, which meant as far as^^^^^^^Hwas concerned that
yes, we wanted him to do the flight, in fact he asked me
specifically how much should I charge, and I told him to
charge the normal commercial rate and that he would be
responsible for collecting the money, it would not be
a payment by the Agency for the flight. There was a period
of waiting for this to happen. In fact he returned a call
to me I see here 2000 hours that Mr. Copp had in fact
called him and questioned him did he have any knowledge of
the flight, which^^^^^^H denied to Copp, so Copp
explained again what he had, a flight from Tel Aviv to
iescribed the cargo that I had earlier described
the cargo as being dimensions only.
I believe at the time the words "mining
equipment" come into play, I am not certain who said that
first. But in any case it was the — oil drilling
equipment, not raining equipment — that we were going to
haul that. ^^^^^^H reported ba£ls_t&.me that the
iffi
reported ba
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customers agreed to the price they had said and agreed on
the fact that he was only going to use one aircrafti
I The agreement wasi
^^^^^^^^^^^^^^^^ le aircraft could not
take off untili
agreed that the aircraft would take offj
to Tel Aviv to pick up the cargo.
They said we need pallets and we had no pallets,
(called and said rather than transport the
pallets during the nigh^^^^^^^^^H that he wanted to take
off^l^Hand go to^^^^^^^^^^^^^mto up the
I agreed that that would be more or less an administrative
flight on our behalf but to pick up the pallets that way.
The aircraft was delayed on departure, that was one of the
next calls I gc
^^^^^^^^^^ am not sure how much
detail you want.
BY MR. CAROME:
Q Go on . We will let you tell the story and go back
IINKIASSIFIED
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over It and ask particular questions.
A Obviously there were several phone calls
back into^^^^^^^^^^ to let them know the status, the
fact that we were delivering and that we were using the
U.S. bird rather than our aircraft. The aircraft
arrived in Tel Aviv and met with a Mr . -- the Captain met
with a Mr. Swimmer, which was the f irst^^^^^^^Wreported
this to me and that was the first time I heard that
name.
Q How was that reported to you?
Froii^^^^^^^^^^^^^^^^Hreceived from the
Captain and I received it ^ron^^^^HH Somewhere during
that conversation it became apparent that the cargo was
final destination Tehran, and they wanted us to fly it
directly into Tehran. The captain balked at this,
obviously, since it was a change for him. He called
land^^^^^H called then called^^^^H
[to inform him that that is what we had come up
against. We had the U.S. registry aircraft was there.
We made the determination that there would be no circum-
stances we would allow the U.S. registry aircraft to go,
we would call the other aircraft into play and continue
to do the flight even though we knew the destination was
Tehran at that time. That is when it came to
come to me and said it is the same load and I denied it
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and I did it more to get him off the subject rather than
]ust to continue the discussion over^^^^^^^^^ltelephone
where there was — speculation as to whether it was the
same load
I denied to him I didn't think it could possibly be the
same. Without a real feel either way.
We were on a commercial phone and I was trying to
cut down the amount of discussion of this if we could.
Later we did recall the aircraf
Q By aircraft, which aircraft are you referring
to?
A The^^^B aircraf t , the one we owned, once it was
determined that we could not use the United States registry
aircraft and had it diverted into Tel Aviv. They had already
started loading the aircraft as a matter of fact, the
U.S. registry aircraft when this was discovered. So when
our aircraft arrived we had to off-load the one into
ours and a decision was made to ship it bac
That was a decision between^^^^^^H and myself. He had
reported to me, this guy, the guy on the ground there must
be crazy, he was trying to talk the captain into changing
the numbers and flying formation and they were upset that
we were pulling that aircraft out of the deal, but we stood
our ground and off-loaded it and took one crew out and
flew them back
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The next thing that come along, as I was
reporting this back to^m||||^^| the question come up as
to who would provide overflights, since we had obviously
not requested overflights for this flight. And I was told
once again to handle it as a strictly commercial flight
but to be aware that the overflights would be granted
and the way paved, I should say, that the overflights would
be granted and the people there responsible for providing --
Q Who told you that?
A This come from either^^^^^^^^^^^H^ i think
I feel fairly conf ident^^^^^^relayed that to me.
He assured me the overflights would be granted but
would have to handle it commercially with the
people on the ground there.
So then we got into some planning as far as the
flight itself went because in order for them to make sure
that the overflight was expedited or at least would be
granted, I passed to them the FIR times for the aircraft
from take-off and since we didn't have a take-off time
because the loading was going so long --
Q What does FIR stand for?
A It is the air international boundary — I should
be able to tell you what the initials stand for -- each
country has an imaginary line as to once you cross that
line you are into their =* 1 r Fi nf^^t ^ Jtt' " *" in essence is what
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It is, you are transferring from one country's air space
into another country's air space at an internationally
agreed upon point. Part of over flight clearances is you
must tell them what time you will be at the point and if
you are crossing the country, what time you will leave
their FIR. I passed those two times into headquarters.
Q Who did you pass them to?
A To|
Q What happened next^
A The next instant I got a call froml
because he was handling this pretty much on his own and
things were going pretty smooth or at least we thought they
were^^^^^^^Hj had told me they were going to fly
directly to Tel Aviv, they were going to file fori
but overf l^^^^JHHand fuel the aircraft to do so. After
the aircraft was fueled they informed him they were telling
him they had to land^^^^^^^^H and this would involve
defueling of the aircraft because they were too heavy to
land.
He wanted me to stop it. I made no effort
to stop that other than to inform eitherl
that this was the case and of course, the decision was made
we would defuel the aircraft and land^^^H^^^^as they
had instructed the crew to do. So they did defuel the
aircraft and eventually t^qj(^p^,flji^he flight.
41
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^checked with you and he checked with
someone at^^^^^^^^^Kto make sure that was okay?
A To inform them, rather than checking -- we knew
that we weren't going to interfere at that point.
was either^^^^^^^^^^^^H^^^^that you
spoke to on that matter?
A Yes. The next communication I had with!
was the aircraft took off, I got the take-off time. A few
hours later I got a call from him that on landinc
that the crew had called that they were in trouble.
They had no documentation on the cargo and their impression
was that nobody at the airport were expecting them and
consequently they had shown up with an aircraft without a
proper manifest and so forth.
Iwas in sort of a panic and a little mad
at this point at how disorganized this thing was. I called
informed him of the problem. He put me
off and called me back later with the information that
we would have to handle it, that he couldn't help us, that
the crew would have to work it out somehow themselves. To
which I calledf^^^^^^Bback and this all took place in a
matter of I would guess an hour or so.
When I callec^^^^^^^H back to tell him that the
crew would have to handle it themselves, he informed me
the crew had in fact done that, that they had and written
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out a manifest and given it to the local authorities|^^B
land apparently to their satisfaction.
Then the next call was the fact that they were not
able to take off because they didn't have^^^^^^f overflight
Before any action was taken on that, I did get a call
back saying that they had been granted take-off clearances
and they were talking to^H|^HH^| air traffic control
people and apparently everything was going well. They in
fact made it through the flight and landed at Tehran.
The next call I got after that was reporting the
aircraft had landed in Tehran giving the time it had
landed and basically that was the extent of that conversa-
tion. We were off for some time while the crew was off
resting and one thing and another .^^|^^^^^|talked to the
crew, I think they were in the hotel while they were on the
ground in Tehran and had instructed the captain to fill the
aircraft up full of fuel and to be prepared to divert --
to call him by HF radio and be prepared to divert from our
planned rest stop. Our planned rest stop coming out of
Tehran was to go back into --
i t flf^^^^^^^^B?
going into^^^^^^^^^^B planned stop.
alerted the crew to make sure they had plenty of
fuel to make^^^^^^^^H in case he gave them the signal
over the radio.
uRcussra
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Q I take it that this question about whether to
Iwas really a question as to whether
to carry on with sorties from Tel Aviv or to drop out of the
operation?
A Yes. I had instructions that even though they
were talking five flights at the time that we were to do
the one flight and after the one flight, we would get
clearances as to whether we would do the second flight or
not and that was the signal^^^^^^^^ was to pass to the
crew, whether we were going to do the second flight or
not .
MR. WOODCOCK: Who gave you those instructions?
THE WITNESS:
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BY MR. CAROME:
Q What happened next?
A For the flight itself, he passed the word for them
to divert^^^^^^^^^H They went^^^^^^^H and refueled, and
at that time he talked to them, I believe by telephone, and
told them to go on back^^^^^^^^^| because he and I had
talked in the interim, and I told him to go back!
with the aircraft, that we wouldn't do any more flights.
To back up, I should say that I was in Washington
on Monday, the --
Q ^^^^^^^^^^fthat morning, that right?
I A Yes.
Q And arrived — what time did you arrive in
Washington?
A Normally I guess 10:30. I don't remember the date,
the norma l^^^^^^^^^^^^^^^^^^^^^H I
arrive in the building about 10:
Why you come^^^^^^^^^^^^^^^^^^H
A Per discussions witn^^^^^^^^^^^Hover the weekend
on Sunday night, I guess, that I would come^^^^HMonday to
catch up on — all of this at that time had been done by
telephone. We had come to a blank spot as far as the schedulfe
was concerned, to get on top of the situation better, to see
where we were going with it £xQni_tlaAfiA or what
\\m i\!s;
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Q That meeting had not been set up a long time in
advance, is that right?
A No, it had not.
Q It was set up over the weekend?
A Yes, I can't really say a meeting other than it
was agreed that I would come^^^^^^^^^in the branch on
Monday. In other words, it was not a scheduled meeting to
'talk about this subject only; it was just to
catch up as to what all had transpired.
Q By the time^^^^^^^^^^^^HWashington, when you
arrived then, had the decision been made whether the!
flight was to proceed
A Yes. But the decision was made that we were going
to do that.
Q To do what?
A Go back^^^^^^^^^H and not go back immediately, but
that my understanding was that we may go back. This was
during the day on Monday, or I would say throughout the day
on Monday, that was my understanding, that we were not to
make a second flight, but the possibility still existed.
Q Who were you communicating with on that subject?
A
Q Okay.
A I am sure ^^^B being in the office all day, I am
surel^^Hwas in on it as well, but^^^^^| primarily since
IINHI A.^IFIFJ)
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I was physically in the office at that time. That evening,
by this time, we had moved hi
to debrief the crew and find out what transpired and ]ust to
be closer to the thing, to collect the money we had not
collected at that point in time.
That evening I was waiting on^^^^fto give me a
ride to the hotel. He received a phone call from
lad already left for the day. ^^^^^received
a phone call f rom^^^^^^^^^^^ that they had to go to the
OGC, Office of General Counsel's office.
Q By "they", who are you referring to?
^^^^^^^^^^^|an(^|^^^^^^^^^^^^^Hinvited me to
go, which I decided was inappropriate, that I didn't need
to be there. So I left and went to the hotel . ^^^^Bwent to
the meeting. Later that evening, he called me, and I have
thought about this, and I can't say for a fact that he
told me that evening that we were not to do another flight
for certain, or if he told me that first thing the next
morning, but either that evening by phone, which would have
been 10:00-11:00 at night, or the next morning when I arrived
in the office, the decision was made we should not and would
not do any future flights.
Q It was^^^^^^^H who coirununicated that to you?
A Yes.
Q Did he tell you why that decision was made?
UNflASSm..
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A I guess that the -- my understanding, it was not
our show; in any case, I found this out only on Monday, that
this was an NSC project and that we shouldn't be involved m
It. I didn't question as to why the decision was other than
that we would not do any more flights.
Q And you were told that either late Monday night or
first thing Tuesday morning?
A Or first thing Tuesday morning, right.
Q What happened next?
A We went back to normal.
Q Did you go back that da^
A On Tuesday, yes . ^^^^^^B was still|
I think until later that week and brought me the -- when he
returnec^^^^^^^^^^^^H and I don't remember, he brought me,
he typed up an after-action report.
Q A particularly lengthy after-action report, is
that right?
A Yes. I hand carried that to Washington on my next
visit, and I honestly can't tell you when that was. It was
the next week, I am certain, but I don't know the day of the
week or what date it was.
Q By next week, you are talking early December, is
that right?
A Right, sometime after the first week in December,
I would say.
iiKipi Accicicn
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48
af ter-actior
Q You would have provide
report to the CXA^^^^^^^^^ is that right?
A Yes. To
Q And I take it that is about where the story ends,
IS that right?
A Until you guys come on the scene.
Q I now want to ask a number of specific questions
about the time period you have just described.
First of all, on the subject of what the cargo
was, what exactly did ^^^^^^^^H tell you in the first phone
call about what the cargo consisted of?
A ^^^^^^^^^^1 ^° ^^^ best of my recollection,
referred to it as sensitive cargo and gave me the dimensions.
And we never discussed what was in the boxes.
My best recollection is that it was never mentioned
during the time we were doing the flight. On the Monday that
I spoke of that I was in the Headquarters Building in a
conversation with^H^^^^^^B I relayed to him th
or the crew members, I should more correctly say, thought
that it was missiles, and I relayed to him that the co-pilot
had made a joke, I guess, that we should be firing them at
Iran rather than flying them into Iran. That was the onl-y
substance of that to me.
Q In that conversation you are talking about that
took place Monday at Headquarters, is that right?
UNCI A.OTJEn_
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about.
By telephone with^^^^^^^^f yes.
I am confused now
MR. WOODCOCK: It is two conversations he is talkinc
BY MR. CAROME:
Q First of all, let's —
A I had a conversation with^^^H^^B by telephone
from Headquarters with him^^^^^^^^^^^^T
MR. WOODCOCK: When was that?
THE WITNESS: Sometime Monday after I arrived in.
Headquarters, the flight actually returned while I was en
route to Headquarters, if I remember the timing correctly.
And sometime later that day, on Monday, I was able to talk
to^^^^^^^l and find out the flight had been completed.
And I got that from him at that time.
MR. WOODCOCK: That is the vehicle joke about firin<|
the cargo rather than delivering it by plane, is that right?
A Yes.
BY MR. CAROME:
Q AndHHH|^^^^H told you in that conversation
that the crew and himself believed that the cargo had been
missiles, is that right?
A I can't say that he said himself. I think he
said, as he had gotten it from the crew, they believed it
was missiles.
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Q Let's, if we can, focus in on this as much as we
can. In the first conversation, that was the conversation
with^^^^^^^^l is that correct? I am talking now about the
conversation where you are being given the task of what is
to be done. Is iti
A The initial call I got was from, yes]
Q And this Exhibit 2 uses the phrase "sensitive
high-priority cargq'T.) Do you believe that is a phrase
^^^^^^^Hused in describing the cargo?
A Yes, I think that was his words exactly.
Q Did you ask him more specifically, "What is the
cargo?"
A No. We were on a commercial telephone, and I
probably wouldn ' t have wanted to hear it over a commercial
telephone beyond his description. He was being very guarded.
Both of us were being very guarded over what we said over
a commercial telephone. I was at 1600, I hope I was at my
office; still I can't remember.
In any case, we were on a commercial phone . ^^^^H
Q Did you suspect it was weapons?
A I don't think I speculated honestly. To me it
was a flight. I think I remember questioning only the
dimensions. There was some question, could we get those
dimensions through the cargo door of the aircraft, and I
UEUSSKIEU
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don't think I speculated at any time during the time as to
what we were hauling.
MR. WOODCOCK: Did you assume that he knew what
the cargo was?
THE WITNESS: No. I don't think I did. I would
assume -- yes, I would assume so, but I don't remember
consciously at that time. Yes, I would assume that he would
have known.
MR. WOODCOCK: But you don't recall an active
assumption on your part that he knew what the cargo was?
THE WITNESS: No. No.
I think I previously mentioned that I have trouble
recollecting who first mentioned oil drilling equipment,
whether I got that from^^^^^Hor whether I got it in
this mirage of conversations during the night, but the words
"oil drilling equipment" had come into place, and it seemed
logical to me at that time that maybe we were expediting a
commercial shipment of some oil drilling equipment to Iran.
If I were speculating at all, I would have accepted
that untilfl^^^^^^^|comment later as to what he thought
the crew suspected it was.
MR. WOODCOCK: You don't recall whether you got
that from^^H^H or CIA Headquarters?
THE WITNESS: I think I got it from^^^^^H, but
I don't recall.
\\m AOOinrn
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MR. WOODCOCK: It could have been either place?
THE WITNLSS: Could be.
BY MR. CAROME:
Q And it is your testimony that it was not until
Monday that anyone said anything to you to the effect that
the cargo was missiles, is that right?
A That is right.
Q That is the first inkling you had of that?
A Yes. And it was not confirmed even then. In fact,
to my knowledge, it has not been confirmed to this day.
Q Did you pass along to anyone ^''^^^^^^^^^H ^^e
fact that^^^^^^^H had made this comment about missiles?
A Yes, tc
Q What did you tell him?
A As I mentioned earlier, the commentB^^^^^^I had
made about the co-pilot saying "We should have fired the
cargo at them rather than hauling it in." And it wasn't
a lengthy discussion, I think it was just in passing as,
you know, while we were doing other things that day as well.
Q Did^^^^^^^^Hact surprised?
A I don't remember him acting surprised, but then I
don't remember making a note of it, like I say, it was in
passing conversation more than anything else.
Q Did he say, "No, it wasn't missiles"?
A No, he did not deny it.
UNCLASSIFIED
53
UNSffl^FlFT
53
MR. WOODCOCK: Who else was present?
THE WITNESS: No one. I think it was he and I
standing in the middle o^JH^^^Hj^H There was other people
around, but nobody was within the conversation.
MR. WOODCOCK: Did you tell anyone other than
THE WITNESS: No.
BY MR. CAROME:
Q About what time do you think that conversation took
place?
A
Q
It would have to be in the afternoon.
As you said, you probably arrived at Headquarters
around 10:30 a.m. that day.
A Right.
Q And when was the first time that date that you had
a conversation with]
A Shortly after my arrival into — because I felt
very bad that I had not talked to him
so^
am certain after amenities, whatever, I got into the Branch
and made the phone call.
Q Was it in that first phone call Monday that
made the comment about missiles?
A I would guess, yes, I think I talked to him several
times that day, but I would guess it would have been the
54
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first one.
Q Oic^^^^^^^^^^^H in that conversation indicate to
you whether or not he believed the pilot's statement that
It had been missiles?
A No.
Q He didn't indicate one way or the other?
A No, we didn't discuss it. I think the extent of
our discussion was that he was going to remainj
debrief the crew, and would return!
give me a copy of the debriefing.
Q And that debriefing was taking place that day,
Monday, Washington time I take it, is that right?
A I don't think so, because my recollection is that
the crew had not made it backj^^^^^^^^^H that day. I
think it was to take place at like the next day, Tuesday,
or so. I can chase it through the paperwork and tell you
where the aircraft was at that time, but my feeling for that
now is that the aircraft had not made it back yet, so he
had not had a chance to set face-to-face with the crew.
MR. WOODCOCK: What was your reaction when you
received this information about the possibility of missiles
being on the plane?
THE WITNESS: You mean personally?
MR. WOODCOCK: Correct.
THE WITNESS: I don't remember having a real
llNPlL^lflFJL
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55
1 reaction. I would have guessed that we were, you know,
2 doing something at a much higher level than me to question
3 It. In other words, I didn't feel bad about it, if that is
4 what you are getting at. I would probably have felt that
5 maybe, my personal opinion is that we were long-time
6 delinquent in not having some sort of relationship with Iran
7 from a geopolitical point of view.
8 MR. WOODCOCK: That is not what I am driving at.
9 You testified earlier that Iran was on the list of prohibited
10 countries, is that right?
11 THE WITNESS: Right.
12 MR. WOODCOCK: You have also testified, and your
13 notes reflect, that the cargo being carried on this airplane
14 was a large -- large volume boxes.
15 THE WITNESS: Yes.
15 MR. WOODCOCK: That is right?
17 THE WITNESS: Right.
1g MR. WOODCOCK: You then received information from
ig j^H^^^^^^^^^^^^Hon November that the large-volume
20 boxes may well have been missiles.
21 THE WITNESS: Right.
22 MR. WOODCOCK: And being large-volume boxes, they
23 would be large missiles presumably.
24 THE WITNESS: Right.
MR. WOODCOCK: Now, this would then be in
\\m t^M
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56
contravention of long-standing U.S. policy, correct; that is,
giving arms to Iran?
THE WITNESS: I can't say that I could make that
statement. As I understand, after the fact, yes, I would say
that it is. I must correct you also in that I did not make
the natural assumption that it came from the U.S., as we
had been involved in other countries shipping stuff in.
If I had to give you a feeling or impression as
the flight materialized, I thought we were expediting -- I
felt we were expediting Israel probably or a commercial
entity getting the stuff in there.
MR. WOODCOCK: Let me back up then. I am speaking
as of 11/25. You come to the CIA, correct?
THE WITNESS: Right.
BY MR. WOODCOCK:
By the you ^° ^^^^^^^^^^^^^^^1 ^^'^ ^°^
been told this is a NSC operation?
A Yes, I think I was told that when I got into the
building on that Monday.
Q So in any event, whether the arms came from the
United States or not by the time ^^^^^H^^^^^^^H calls you
you have an understanding that if these are missiles, they
are missiles being transported to Iran under some approval
of the NSC, correct?
A Yes, that would be true.
IIM£US;S1£I£II,
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Q So now you received this information, and you
simply mention it m passing '^°^^^^^^^^^^^H is that
correct?
A Yes. It was a report -- as I remember the thing, I
hung up the phone, and as I was walking out to fmd^^^^^H
he was standing there in the middle of the Branch and we
talked about the aircraft was located wherever they were,
and the comment^^^^^^^Hmade about the cargo.
It wasn't a formal report. It was saying by that
time we knew the cargo had been delivered, we knew our air-
craft was safely out of Iran, we already knew that, and that
was kind of a followup, if you will, that let him know of
the conversation I had with^^^^^^^Band the agreement I
made with^^^^^^H.
BY MR. CAROME:
Q Was it^^^^^^fwho told you it was a NSC mission?
A Yes.
Q And, again, did he exhibit any surprise when you
told him about the pilot's comment that it was missiles?
A I don't remember him being surprised or acting
surprised or --
Q Did he act like he already knew that information?
A I don't have a memory of him reacting to it really
other than I just said -- didn't pick up on it and we didn't
discuss it further than that. I didn't get the impression
liMCU^SML
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1 he was evading discussion of it either. In other words,
2 It ]ust, you know, I didn't form an impression of that.
3 Q Did it seem to you that that was information he
4 already had, did he react that way?
5 A I can't say. I honestly don't remember a reaction,
6 period. I think it was just that I passed it to him. The
7 only reaction I can remember that^^^^^Hdemonstrated to me
8 through that whole day, as a matter of fact, when I was there
9 personally was that we had managed to do a good flight, and
10 he was very, you know, proud, as I was, that we had pulled
11 it off and nobody got hurt. We felt we come through looking
12 pretty good on the thing, that my crew had successfully
13 delivered the cargo, whatever it may be, and had made it
14 out of the country without any problems, because there was a
15 certain amount, at least on my part, apprehension because in
<g that part of the world you don't know what is going to go
■^j wrong.
MR. WOODCOCK: I gather he didn't deny that it was
missiles?
THE WITNESS: No. No.
MR. WOODCOCK: He didn't try to correct any im-
pression that you may have had that it was missiles, is that
23 right?
24
25
THE WITNESS: No.
MR. WOODCOCK: You did not mention this tol
59
(webi^R^
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^^^^H is that
THE WITNESS: No, I don't think I did at all that
day. To my recollection, trying to think of this after the
fact, I think that was the only time it was mentioned of
what the cargo was. To me, it wasn't that big a deal what
the cargo was. The big deal to me was we made the flight and
got out okay.
MR. WOODCOCK: You later learned that day that HH
^^^^|was going to brief the General Counsel on this flight,
is that correct?
THE WITNESS: That evening, yes. That wasn't a
briefing, he was going to meet with the General Counsel
with reference to this flight.
MR. WOODCOCK: You understand it was this flight
that was the subject of that meeting, is that right?
THE WITNESS: Yes.
MR. WOODCOCK: You didn't take it upon yourself to
say, "Look,^^^^| you ought to know there is a possibility
that this flight was carrying missiles"?
THE WITNESS: No.
MR. WOODCOCK: Why not?
THE WITNESS: I don't think it was germane to the
thing at the time. As a matter of fact, we were getting our
coats on, in the process of locking the door to leave, when
he received the phone call that they had to go to the
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General Counsel's office, and he said, "Do you want to go?"
Or something to that effect, and I said, "I don't think that
I should be there. I will go on to the hotel. Call me
later. "
BY MR. CAROME:
Q Why did you not think you should be there?
^Hf^l^^^^^^^^^^^^H^^^^^^^I try to
keep my profile as low as possible so it gets around the
building as little as needed, as well as around the com-
munity..
Q Did you have any indication that^^^^Hwas already
aware that it might be missiles on the flight?
A If I had to make a statement, I would say that he -
not necessarily that he was aware of the missiles, but he
was aware of the flight. He had more knowledge of the cir-
cumstances of the flight than I did or had a need to know,
because he obviously was inside the building working this
thing the whole weekend, as ^^^^^| was.
Q Now you understand that both I
^^^^H were at CIA Headquarters over the weekend?
A Yes.
Q
A
Q
A
"Working the flight' ,i as you sayj
Yes.
Okay.
At various times singly, and other times I would
AOOinrn
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talk to one, and three minutes later talk to the other at
the Headquarters Building.
Q How do you know that?
A That they were at the Headquarters Building?
Q yes.
A I guess I would have to say that I felt that is
where they were at.
Q You were making phone calls to them, is that right?
A And that is where the phone was being answered, and
when they called me, I had no way of knowing where they were
calling from, but maybe I made that assumption that is where
they were.
Q But you made calls to Headquarters?
A Yes.
Q And spoke to both ^^^HB at some point an<
at some point at CIA Headquarters, is that right?
A Right.
Q In that initial phone call, did^^^^Htell you
what it was that made this a sensitive cargo or what it was
that made it a high-priority cargo?
A No.
Q Did he mention that —
A Maybe I should have that question again. I don't
remember that anywhere other than the fact he said it was
sensitive, high-priority cargo, and he gave me the weight
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and dimensions.
Q And those are the weights and dimensions shown in
this Exhibit Number 2, is that right?
A That is correct.
Q I take it, from your testimony, that you didn't
learn of the NSC aspect of the mission until that Monday,
is that right?
told you about that at the
A That is correct
Q Neither
time, is that right?
A No.
Q Did you speak to^^^^^^^^at all about this flight?
A No. First time I saw^^^^^ I guess, was on .Monday,
and I had the impression that it was a bigoted project with-
in the Branch, because he never attended any of the meetings
or discussions that I had with^<^H^^| or with^^^^^^^H that
day. In other words, he was out the whole weekend. I don't
know if he was out of town that weekend or what. I never
discussed the flight with him, though, no.
Q How about^^^HH^^^^H did you ever discuss the
flight with him?
A No. No.
MR. WOODCOCK: Did you see him there at all?
THE WITNESS: No. I didn't even see him that night
when he and^^^Hleft to go to OGC. ^^^^|met him apparently
iiMoi Accinrn
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63
up front of the building, or something.
BY MR. CAROME:
Q Wa^^^^^^^^^^^^^of f ice down th€
roon?
No.
He was in another part of the building?
Yes.
MR. WOODCOCK: Did^H^^^^ tell you why it was
that he was going to brief the General Counsel?
THE WITNESS: No. He didn't know himself. I say
that, that was my impression, he didn't know himself, because
we were on our way to get a drink and take me to the hotel
when the phone rang, and he hung up the phone and said, "I
have to go to see", not brief, "see the General Counsel with
MR. WOODCOCK: He knew the topic.
THE WITNESS: He didn't say the topic.
MR. WOODCOCK: But you understood the topic to be
the flight, is that correct?
THE WITNESS: Right. I don't know why.
MR. WOODCOCK: If he didn't say the topic, why did
you think it was the flight?
THE WITNESS: I don't remember him saying the topic
I just have that feeling that I knew that that is what it
was. I don't know where I got tJaatrTrom. As you ask the
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1 question, maybe he did say, reference your flight or somethir.
2 I don't know,
3 MR. WOODCOCK: You knew he invited you along,
4 however.
5 THK WITNESS: Yes
5 MR. WOODCOCK: Presumably he did that because he
7 presumed you had information that might be relevant to what-
8 ever he was doing with the General Counsel, is that right?
9 THE WITNESS: Yes
10 BY MR. CAROME:
•)•) Q Also, I take it, you were aware that this flight
12 was probably the major matter on which -•
13 A That day.
1^ Q ^^^^^^^^^H had worked on over the weekend and that
15 day, is that right?
1g A Yes. That is true
.•y Q Do you know who it was that asked
speak to the General Counsel?
,.g A It was my understanding that it ^^ ^^^^^^^^^^H °^
2Q the phone. I didn't ask. I guess he informed them they were
21 going to see the General Counsel.
22 Q Did you at any time learn that this cargo movement
23
was associated with an effort to free hostages?
A No. Not until the first cali 1 got reference you
guys investigating it, and the television coverage in
IINIIIAS51F1FJL
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whatever, Noventser, '86, or whatever timeframe that was.
Q Did you know at the time who Copp was?
A Not as this developed. In November — sorry,
sometime after this, after I turned in the after-action
report and the subject come up one day, I am not sure in what
spirit or whatever, I was given to understand from^HH that
Copp was Lieutenant Colonel North and that was in passing.
There was no real reason to have said so or anything else.
And I accepted that.
I had never talked to him or never had any deal-
ings with him. He was the guy that had contacted
until, what, last week or two weeks ago, when General Secord
was on the television, and in another conversation wit
he made the comment to me, "What did you think of Copp ' s
testimony?" And the next time I said, "I thought North was
Copp." "No", he said, "I did, too, at one time. But
Secord is Copp." That was the extent of my knowledge.
MR. WOODCOCK: Was that the first time that you
knew that General Secord was in any way associated with this
flight?
THE WITNESS: With this flight, yes.
MR. WOODCOCK: That is when you heard him identify
himself as Copp on the television?
THE WITNESS: I didn't hear that, but^^H made
that comment to me.
iiMpi AQQinrn
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1 BY MR. CAROME:
2 Q When was the first time you heard North's name in
3 connection with this flight activity?
4 A I never heard his name connected with this
5 particular flight. Later in May of '86, we made another
6 flight to which I was told that McFarlane would be a
7 passenger on the flight. Af (tar'sfciiat flight, I was told that
3 North was on the flight as well — after the flight, not
g prior to the flight.
to Q' When did^^^^fmake his commen4^^hat Copp was
■J1 North?
•)2 A This was in, this first came out in November, '86,
13 late November, '86.
•J4 Q If we can go back to the initial conversations,
15 what did you understand to be the CIA's role with respect to
•jg this flight activity?
.y A My understanding was we accommodated someone,
whether it be Israel or who it was, at the time of the
ft, /obvious
ig f lightonow,"'obviously found out since then that we were
20 deeply involved /(I guess within NSC or whatever, through the
media or whatever, but at that time my feeling was that we
22 were accommodating the flight taking place.
If I had consciously knew what I thought at the
time the flight was taking place, it was probably Israel
shipping some stuff to Iran and was having trouble arranging
iiMoi Aooirirn
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air transport, and we had this as an accommodation to them.
Q This flight was handled quite differently than the
way a normal commercial flight would be handled, is that
right?
A No, I would say it was handled more like a com-
mercial flight would be handled than a normal operational
flight that we may be involved in^in that our crew dealt
with an individual on the ground in Tel Aviv,
dealt with an individual by the name of Copp and later by
the name of Swimmer, as far as the money transaction portion
A
of it and so forth. So it would be as if a regular com-
mercial flight in that sense. I may have not understood
your question.
Q Let me see if I can sharpen it a little bit. You
were in almost hour-by-hour contact with!
during this flight activity throughout that weekend, isn't
that right?
A Yes. In that regard, yes, you are right.
Q That is quite different than the way a normal
commercial flight would be handled by^^^^^^^^f isn't it?
A Yes.
Q In fact, usually you wouldn't be in contact with
[during the course of a normal commercial
flight, isn't that right?
A That
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Q And also you knew that the ^^^^^^^^H people were
in on a weekend actively following and monitoring this flight
activity, isn't that right?
A Yes.
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MR. CAROME: And that wouldn't happen during a
normal commercial f.'.igut?
THE WITNESS: No.
BY MR. CAROriE:
Q And in fact you even^^^^^^Hto Washington to
speak to people at^^^^^^^^H Headquarters specifically
about this flight; is that right?
A Yes.
Q And that never happened with respect to a regular
commercial flight; is that right?
A Yes. I misunderstood your question. I'm sorry.
Q And it was clear to you that this was while maybe
the CIA — let me withdraw that question.
It was clear to you that this was a flight that
the U.S. Government was interested in; is that right?
A Yes.
Q Wanted it done?
A Right.
Q And^H^H^|HH was aware that you were checking
in regularly with CIA headquarters, isn't that right?
A Yes, he was.
Q I gather that frequently when over that weekend
called you, you would relay what
was saying to]
is that right?
A That is t
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70
1 Q And you would pass messages fromj
I^HH^^^^^^H as
3 A Yes. No messages direct to him, but impact of the
4 flight, what was the decision as to what would be done.
5 In other words, giving me guidance that I would provide him
6 with.
7 Q Was this the only special flight that you are
8 aware of where payment was made tG^^^|B|B by a private
9 person?
10 A Yes, it is.
11 Q And you saw this as a special flight, as a U.S.
12 Government special flight, right?
13 A Yes, I did.
14 Q What did you tellH^^^^^^^^^H namely; about
15 how to go about negotiating the price? I think you
16 mentioned something before on the subject, but I want to
17 pursue it a little further.
fg A I told him to treat it as a normal commercial
19 flight. He said, "What should I charge," because we
20 had conversations as to availability of the aircraft and
21 the fact that it was looking like a regular commercial
22 flight. 1 said, "Make money off the flight, but you
23 neogtiate the price and you deal with Mr. Copp directly,
24 and you collect your money with Mr. Copp." Because we also
25 had questions on the earlier phone call as to how we were
I going to by gas IAm^PIjA V^&anFlL ^" <^^°^ ^°^ ^^^
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the crews to walk around with. I told him Mr. Copp should
make those arrangements directly.
The only statement I told Jbira was we being the
agency want you to make that flight, but deal with Mr.
Copp financially and the details of the flight.
Q Are those pretty much the instructions that
you received from
A Yes.
Q And was it your understanding that the initial
was to
arrangement reached between Copp and|
-y make ^'St consecutive flights using both airplanes for a fee
of $60,000 plus various expenses -- that seems to be what
your written report here reflects.
Does that conform to your recollection?
A Yes.
Q And you understood that these three flights
were going to take place between Tel Aviv and]
according to the original plan; is that right;
A The original plan, right. The original conflict.
There was some discussion and the reason I was checking
my nOf^s here, there was some discussion that they were
saying three flights. Our crew was saying they would never
get it on three flights, the number of boxes, because of
the shape and the way we were having to load.
That is l»#if T%^? checking batk to see how many
IIMPLAOOlTirit^
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72
1 flights we were talking about. In other words, the
2 discussion was internally. The guy on the ground was
3 saying three flights, and the crew said we will never do
4 it in three flights.
5 Q Who was the guy on the ground?
6 A Schwimmer was saying three flights, and the captain
7 was saying they would never get that on three flights.
8 Q There were 80 pieces to be moved? It is hard to
9 read, because of the copy.
10 A I think that is 80. It looks like 80. I
11 don't remember it. If I could see it better, I could
12 tell you — yes, 80.
13 Q The record can reflect that the witness was looking
14 at a somewhat clearer copy of Exhibit 2.
15 Did you have any other discussions -- let me back
16 up a little bit. I take it thatj^^^^^^H told you what
17 the terms that he negotiated with Copp were at about the time
18 that this was all happening; is that right?
19 A Yes, he did.
20 Q And did you say that sounds good or that -- what
21 did you say?
22 A Yes. I think I probably said okay or it sounds
23 good. I am not sure what I would respond, but it was
24 okay by me in any case
25 Q Did you_la^j^ UiJl J^'t'tf^l'I^H ""^ '' ^^^ question of
mmm.
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what the customer would be charged?
A ^^^^^^^^asked me what to do about the one
aircraft that we had taken in there and let the aircraft
sit, and then had to turn around and send it back home;
what should he do about charging the customer for that.
My statement to him was that it was a commercial contract.
Charge him as you would any other commercial contractor,
positioning and depositioning cost of the aircraft.
At that time I knew the price would change from
the previously agreed upon $60,000.
Q Do you know what the basis would be or how you
would figure the additional charges?
A So much per flight hour depending on whether they
are buying the fuel or you are buying the fuel or what.^
I don't know how he ccune up with his price. I nevei
made an attempt to find out.
Q If you would refer to page 2 of your hand-written
notes about five or six lines down, there is a reference to
the fact that manager indicated this was the same load he had
earlier reported to us
Do you know what that is a reference to?
IMUSSMD,.
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A Yes, that was the 13 flights]
Tehran. ^^^^^^^^^^^
Q And that was something that^^^^^^^^^^H had
earlier reported to you as being munitions or armaments;
is that right?
A Right, on the market, right, to use his words.
Q Was it^^^^^^^^^^^^Hquestion
in part --"Isn't this the armamentsj
A The question was not armaments, I don't think.
The question was the same flight.
Q But he was then referring to —
A He was referring to the armaments or the
same cargo, right.
Q Had
rephrase that question
Whe
armanent shipment
ever told you that he — let me
described to you the
did he make any
mention of the fact that it was big boxes and small
boxes?
A Yes.
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Q Part of what I was asking was did I
say anything about that flight or that cargo being in part
very large boxes and in part smaller boxes? Did he
talk about two different sizes of boxes?
A No, I don't recollect that. I asked him how did he
recognize it, and he said because of the size of the
boxes I had related to him was how he mentally made the
association, because the destinations were different. I
was telling him from Tel Aviv ^'^'^^^^^^^^^^^^^^l ^^'^
I to Tehran, so he was saying there was
the leg the f lights ^^^^^^^^|^^^HH|^^^^^^H
Q oi(d^^^^HH^^^|ever describe to you this cargo
^H^^^^^^^^^^^^^^Bbeing a mixed cargo, part armaments
and part something else?
A I don't recollect him saying that.
Q As far as you understood it, it was a shipment of
76
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1 armaments; is that right?
2 A Right.
3 Q I take it he posed this question to you: "Csn't
4 the same f light^^^^^^^^^^^^^^^H" you
5 him, no. Is that correct?
6 A That is right.
7 Q Why did you say, no?
8 A To stop the discussion because it was leading
9 nowhere. I had no way of knowing and didn't see it
10 germane to this flight. Should I go to headquarters and
11 ask them -- part of the dealing with a guy like!
^^^^H^^^^^^^^^^^^^^^^H is you
13 trapped into talking about more than you should talk about
14 to get the job done, so that was my effort, to shut him up
15 on that point and let's get to doing the flight and not
15 worry about if it was a previous flight.
17 In fact, I never thought about it later.
18 Q In the conversation in which you denied it was
19 the same flight, I think you were placing it in time as
20 having occurred after the destination was changed^^^H
21 ^^^^^^|^° Tehran. Does this review of your handwritten
22 notes that we have just done change your recollection and
23 in fact indicate to you that actually that conversation
24 took place earlier?
25 A I may have misspoke. I understood that it took
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place earlier before I knew the destination. The only
destination I knew was from Tel Aviv^^^^^^^^f I presume
he was making the connection these guys were going to Tehran
with this stuff ultimately, and I stopped the discussion
at that point.
Q The next sentence of your handwritten notes,
it is difficult for me to read, but it seems to say
if we decided to this — I'm sorry, maybe you can read it
better than I. If you could read the next sentence of
this r-eport.
A It says, "If we decided to do this, he indicated
he needed to^^^^^^^^^^^^Mroordinate and take money."
Q I take it that the "he" there is|
is that right?
yes.
Did hel
No. In fact, I think in the next sentence —
What does the next sentence say?
It says I passed this on to — I presume that was
Chief!
That is Dewey Claridge. He called back that they were
considering it, but did not want^^^Hto get out of touch
with the customer long enough to make the move, and that
is when I told him not to go.
Q I actually see in looking at this paragraph in
IIMPI lOOJririk. :
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inwa^flffT
your notes that by this time the subject of taking the
cargo to Tehran had in fact come up. I see the sentence
before the first one we were looking at makes a reference to
Tehran, again on page 2; is that right?
It appears to say -- "The customer also requested
we further move cargo to Tehran. "
A Yes.
Q So that ultimately perhaps in fact the conver-
sation you had about whether or not this was the same
cargo that had been turned down perhaps did come up at the
time when the Tehran location came up?
A I am sorry, I misspoke.
MR. WOODCOCK: In fact, if you refer to the page
immediately preceding that, this appears to be 1,000 hours
on the 23rd; is that correct?
THE WITNESS: That is correct.
MR. WOODCOCK: One thousand hours is 10:00 a.m?
THE WITNESS: Yes.
BY MR. CAROME:
Q I take it that what was being passed tol
and Dewey was the new destination of Tehran; is that right?
Is that what you were referring to here?
Yes, as well as the f aot -tHa^l
thought he
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needed to go.
^
Q You used the name, "Dewy," here in this
r
document. I take it that that meant Dewey Claridge; is
A
that right?
A That is correct.
r
Q How did you know that Claridge was involved
A
with this operation?
A I know that^^^^^Hmust have told me that is who
he had to clear it with or who he had to discuss it
with. 'I don't remember^^^Hever mentioning Dewey, but
I do know that^^^^^Hin this instance said he would
talk to Dewey and would call me back.
If you want to make an assumption, I assume
that Dewey, knowing his job in that area of the world,
maybe he would be involved.
ing with Claridge on this mission?
A That was the only other name I heard, yes.
MR. WOODCOCK: Had you heard it before you noted
it here?
THE WITNESS: I don't think so. So this
instance, page 2 of this exhibit — when he said he would
talk to him, yes.
MK. CAROME: The-neiMa ssvlwrtclk J bdbl-d you read it
and tell me what it means?
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THE WITNESS: He called back that they were con-
sidering it, but did not want, I presume that is^^^k, to
get out of touch with the customer long enough to make the
move.
BY MR. CAROME:
Q Do you understand what that meant?
A Yes.
Q What did that mean?
A That meant that he was constantly talking
to the customer by telephone, and if he left his quarters
or home to^^^^^^^^^^H to meet with the customer, he
would be out of touch for the period of 10 or 12 hours
that it would take to fly over there commercially.
Q In any event^^^^^^^^f at some point--perhaps
later this day or some time on Saturday, did go ovei^^^^H
You understood that; is that right?
A Yes. I think it was Sunday, but I don't know --
I would have to read through and see if I could figure
out when it was.
Q There is some writing on this page 2 of Exhibit
2, which runs vertically ujS the page. Can you tell me what
that means?
A No, I couldn't. I don't have any recollection
as to what it meant. I am sure it meant something at that
time, but it doesn't now.
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Q Can you tell me what it says?
A 2:00 p.m. Looks like 4:00 p.m.
^H^H and I am not sure what the other one could be. It
looks like a word starting with^^Hor something.
Q Do you know what the word ^^^^^^H that appears
towards the bottom of the page refers to?
A I would think -- I recognize the word -- it was
actual ly^^^^^^^^^^^^^^^^^^^^^^^^^^I suspect, was the
name of the fuel company or the people at^^^^^^B that we
were using to handle the aircraft as it landed. With a
U
large aircraft, you have to have setps, you have to have
A
ground power, air and that type stuff.
I don't have a firm recollection of that is what
it is, but since I have not used that name or seen it since,
then I suspect that is the name he gave me that was doing the
handling of the aircraft while it was on the ground at
Q Turn to the next page of Exhibit 2. Do you have
any recollection of what the first two lines say or
mean?
A At the very top?
Q Yes.
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Q Are there parts of this third page that do relate
to the^^^^l^l flight that we have been talking about?
A In the center of the page where it says "routingj'|j
that on the|^^|^m flight.
Q What about just above that, the few items above
that? Do they relate to th^^^^^HH flight
A No.
So when you get to the middle of the page where it
len you ycu uu i.n= ...^w.>»^». --
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says routing those are again relating to thel
flight?
A Yes.
Q What do those entries mean?
A Apparently I was asking him for the routing, the
entry/exit points and time, estimated time of departure for
I made a note "no direct routing available, exr;=rct
indirect routing, planned route dangerousrl/ and I wrote
the word "norma]/" J i I presume I wrote the word "normal" aS
saying although told it would be dangerous, it would be
normal.
Q Why was "dangerous" used in these notes? Was
that — was thatf^f^^^^^^^^^phrase?
I that was^^^^^^^^^^Bphrase,
I wouldn't want to be specific on that because I don't
remember, but I do think it was^^^^^^H^^^^ statement .
Q Can you tell what the remainder of the notes on
the page refer to?
A "Eight miles a minute." That would be the first
entry you are looking at. ^^^^» whatever that -- that must
be one of the FIR boundaries , ^^Hminutes after takeoff".
Q Would that be|
A Yes, and I say that because of where it is
positioned on the paper, "J°5g ^^^^-'^''JjiJ'y •
le paper, more than memor:
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The other position was^^^^^B Apparently I
started to write;^^^Bsomething or other, and changed it as
to an hour and 24 after^^^| Tehran was^^Hminutes after
I presumel
Across the page from it I am not sure what those
are, "1400 local, 1600 local estimated time of departure('w
Probably converting time.
Q What about the reference to Tabriz?
A There is a time next to it. If I could look at a
map, I could almost tell you. I assume that Tabriz is the
northwest corner of Iran.
That is what the notes mean to me now in any case.
Q Did you have discussions over that weekend about
the flight possibly going to Tabriz?
A I don't recollect that, no.
Q As far as you are concerned, that subject just
didn't come up?
A Yes. I don't recollect it coming up.
Q Can you tell what the remainder of the notes at
the bottom of the page mean?
A "In air^^^^^^^^^B" , that, I presume, would be
reference to the U.S. registry aircraft.
Q The aircraft that didn't go to Iran, is that right?
A Right. And the note beside that would be "aircraft
ready but no money, no traffic rights, and no guidance."
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This apparently was the note -- a call fromJ
notes I made as a result of a call f roir^^^^^^^l that we are
ready to go, but we don't have money or guidance or
traffic rights.
Q Is there a time there?
A It looks like 9:50.
Q Would that be local time?
A I would presume so.
Q If you could turn to the next page and the
last page, do you have any idea what thel
reference is, the second line?
A If I am not lost — this apparently was taking
place while they we re^^^^^^^^H they were discussing how to
transitj^^^^^^^^^^^^^P That was something thatj
had passed to me that they were going to have to gc
and I am not sure what the "8,000" meant.
It could mean altitude, but I don't think that is the case.
guy at ^^^^fl^^^^^^l^^H ^'^^'^'
can go in twof'\y and I presume that is two hours.
"At 1150 I received a call they had released the
aircraft based on people at the site, assurances of traffic
rights." That would be^HHm traffic ^^'3^^^'
Q What does the next reference refer to?
A I write bad enough, and the copy is bad. I think
that is^^^^^^^H but I don't know. If I could see the
3^^^H|HH but I don't know.
^TWPI A<JQIFIFn
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:aS-6 ' original -- "ETA"yy' estimated time of departure, and then
it says "slant via" -- I am sure it meant something to me at
the time, but it doesn't now. ETA is estimated time of
arrival; ETD, estimated time of departure.
Q What about the bonus for employees reference?
A H^^^^^^^Hmust have mentioned whenever we get
through we better pay these guys well. This was after the
discussion that the captain had talked himself out of
troubl^^^^^^^^^^Brather than us helping him out of trouble
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Q What about the next --
o
A I say here that we have to deffuel and land at
6,000. That is the fuel we would have to take off.
I am not sure why that came up at that point.
As you can see, I was getting tired of this thing
and my notes get worse as time went on.
Q This is actually very helpful to have you decipher
some of this.
What does the next line refer to?
A "1400 hours to unload." ^^|^H^s telling me
what the captain reported to him — to onload, not unload.
He said there were two groups of people in Tel Aviv.
Q Do you know what that meant?
A Apparently they were dealing with two groups of
people in the loading process. I think he refers to that in
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his debrief later on, the confusion going on in Tel Aviv
and that they were apparently being told not to come back
direct, but to goi
He was saying something, speculating that at the
rate they were going to go it would take 24 hours to load
one aircraft. They are very rich guys, in reference to
Schwimmer. I found out later that is who he was
referring to.
Q And that is the person he was dealing with in
Tel Aviv?
A And talking to and about what the captain was
dealing with.
MR. WOODCOCK: Directing your attention to the
prior page, at the bottom of the page, I believe there is a
reference already to Schwimmer. So you already knew that
Schwimmer was involved by that time?
THE WITNESS: I knew the name, yes, or he had
relayed that name to me, yes. In fact, I think he related
to me that the captain was in Schwimmer 's home in Tel Aviv
during the phone conversation, because I was concerned that
this was taking place over HF radio and he denied it, "no, no,
I am not stupid."
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WtBlSSffiF
BY MR. CAROME:
Q What about these series of numbers then
between the "very rich few" reference and the giggly
line?
A They obviously have to do with estimated times
of departures. I would guess the first on the right
side -- I am not sure of the one on the left -- depart T,
looks like I scratched in 15, I don't know why. I would
take that now to mean Tel Aviv at 2000, arive
depart^^^^^^^^^^^^^^^H arrive
Tehran 0010 on 24, depart Tehran 1410 Zulu on 24.
I am guessing that those were the times we
were estimating rather than the actual times. I would
have to go back to his report to give you the actual times
I guess.
Q And below the jiggly line can you tell me what
those two lines say and mean?
A That is in reference to my earlier comment about
when the aircraft 1 and ec^^^^^^^^^^f they were in trouble
because they had no cargo docks or no manifest of any form
to give the people and it was — the appearance was they were
not expecting them as they had been led to believe that
everything would be okay on landing, not to worry about it
Q And the second line there, can you tell me what
that says?
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A I think it says will check J^^^^lbut I can't
tell you for certain.
Q What does that mean?
A Well, because of where it falls in the
sequence, ^^^^B being in our cryptic conversation over the
telephone that I would say tod||||||||H"that I will call
I" meaning CIA Headquarters and find out if I can
get him.
Q
Q I see, ]us1
A We refer tc ^^^^^^
^^1^^ for the CIA, and Europe is^^^^^|usually when we
are discussing these things on the phone.
So it looks like a^fland a check mark and the
word ^^^^
Q Can you do the same description or explanation
of what the remaining references on this last page of
the document Exhibit 2 refer to?
A As I had mentioned earlier I calledl
asking for help to get the aircraft captain out of trouble
and get the aircraft moving and had received the word
that there would be no help forthcoming that we could
not intercede at this point, that he would have to get
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himself out of trouble. As I returned the call to
:o tell him that, he reported to me the aircraft
was ]ust off, just airborne I guess is what that would be
more appropriate.
And that they were airborne 2.5 hours after landing
and I can't tell what the time is over this, this is
blocked by th^^B He gave me an arrival time apparently
for someplace.
Q Then there is a reference to
A Yes. That was our planned, where they would go
for crew rest unless we told them to 9<^^^H^^^^B told
them otherwise. I presume that would be the time we
estimate they would be^^^^^^^Hor time enroute
vould be more appropriate.
Q As I understand from your testimony earlier,
the plan was to make a decision after the first flight
had gotten to Tehran whether or not the additional
flights would take place, is that right?
A I knew at the time we were making the first
flight we would make only one flight and then we would
maybe get approval for the second. In other words it
would be decided at that time. I had passed that to
We were not automatically going to go back and
make a flight. You know, it is not to be that obvious
that that is the case. In other words it — he had approval
IfllAl a MM.
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to make one flight from me although they were talking
three flights at one time, and I think five was even men-
tioned and his question to me, as I recollect, was "do we
do all five flights without checking back in?" I said
"No, we will make this flight and then we will determine
if we go beyond that."
Q Let me see if I can sharpen this point a little
bit. I take it originally that it was going to be fine
for there to be three flights from Tel Aviv tc
IS that right?
A I don't think so. I think what I am saying
Q I am talking to Tel Aviv toj
A Tel Aviv to^^^^^H yes, sorry.
Q When you were in the original plan there would
be no question that you move the whole load, there would
be a series of flights, is that right?
A My understanding was that we would move the whole
load, whatever the load was, yes.
Q I take it then that when the subject of going
to —
A — to Tehran came up —
Q When that subject came up that you then got in
with^^^^^^^^^l and point^^^^^|^^^ told
you we are going to do these one at a time?
A That-wpyld be my recollection, we will do one
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and evaluate and see whether or not we do any more.
Q And do you recall who it was you were talking
to on that particular subject?
A No, I can't.
Q Would that approach have been adopted in the
first telephone call or first conversations you had
with^^^^
A After the Tehran destination was determined, yes.
Q Who made the decision that a second flight would
not happen right away?
A Not happen right away?
Q That is right.
A In other words the possibility existed still of
a second flight?
Q Yes, I take it that —
A That would have been —
Q Let me see if I can break it down into more than
one question.
There was a decision to be made after the
plane had landed in Tehran whether the plane would return
or return^^^^^^H is that right?
A That is correct.
Q And if it returnec^^mi^^^that would have
meant that you were going to pretty much just continue
on with the operation with consecut^^ flights, is that
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right?
A That IS not true. The return ^^^J^^^lwould
have meant that they were going to crew rest and before they
took off again we would have made a decision whether
they would go in fact back or not.
My recollection is that^^^^^^^Hon his own made
the decision to divertj^^^^^^^ as a result of the way
things were going even though we had not said there would
not be a second flight. He was waiting on the signal from
me to know whether we would go back at all.
Q Before you gave him a signal to gol
[he made a decision ^'^'^^^^^^^^^M> ^^ that right?
A When the crew was airborne if my recollection is
correct, after they were airborne from Tehran and he
apparently — they gave him some feel for what had
transpired on the ground and he told them at that time to
go and^^^^^^^^^^^H rather than|
Q Did that reflect his desire to no longer be
involved in this operation?
A I would say no. He had never indicated that
"I won't make another flight if you say make another
flight" but it probably reflected his feeling that we
would probably not do it. Again because it went so bad.
That is, we had the probleros^^^^^^^^| the problems with
itwrnfj^rFrrn
ions that the
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captain received f ron^^^^^^^^^Hcontroller as he was
leaving that they would not allow him back through next
time unless^^^^^^^^^^Kiad been coordinated with and
those types of problems that were unforeseen and would have
been expected to have been taken care of by someone.
From that standpoint he made a decision while
on the radio with the guy to tell him to divert]
and call him I
Q In fact —
A Some of that is speculating as to how he did
that but that is my understanding and my acceptance of the
way we went.
Q So he told you that the plane was on its way
back^^^^^^^Haf ter he made the decision to take it back?
A Right.
Q To|
A Right.
Q What did you tell him when he said that to you?
A I am sure I said okay, I will get back with you --
or something to that effect. I didn't have any objections
to that, in other words, I concurred with him.
Q Had you at that point already learned fromH||^|
[that CIA wanted to bail out of the operation?
A No. No. It is not my recollection that that
is the case.
UNCLASSIFIED
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Q This would by now be sometime Monday morning
when the plane was airborne after leaving Tehran.
A I think so. What time was it? I think it is
Sunday night or early Monday morning before I left for
Washington. Let's see, 1900 GMT would be, must have been
Sunday afternoon. You probably have another sheet that
would make that clear as far as where the aircraft was
when.
MR. CAROME: Why don't we mark this as the next
exhibit.
{The document marked Exhibit No.^^B-3 follows:]
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MtOD^ieDr
96
BY MR. CAROME:
Q I show you what has been marked as Exhibit 3
to your deposition. Do you recognize what that is?
A Yes, I do.
Q ^^^^^^^^^^^^^^^1 typewritten report
you on the flight activity, is that right?
A That is correct.
Q Can you tell from this document when -- would
this document refresh your recollection as to when the
flight departed from Tehran? I believe if you go to
page 6 there is a reference to the return flight.
'on the 2 5 November.
And that would have been by my calculation
On Monday afternoon, is that right?
That is correct.
So that it was sometime Monday afternoon that
nade the judgment to take the plane back
Irather than^^^^^^^^^^^lis that right?
Yes.
And it was sometime Monday afternoon that he
told you that he had made that decision, is that right?
A That is correct.
Q Did you tell him any time Monday afternoon whether
it was CIA's desire that^^^^^^H not be further involved
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umsstffiBT
97
in this operation?
A No. I know I didn't because I didn't know that
was the case at that time. I felt we were not going to
make another flight until I had received instructions
to do so. The feeling during the day on Monday was that we
probably would not be making another flight. It had not
been decided we would or could or whatever until that night
when I got the call from^^^Hor Tuesday morning, like I
say I have trouble recollecting that. My recollection was
Tuesday and since conversation with^^^H you know, there
IS no doubt in my mind he may have told me about midnight
that night or whatever time he called me.
Q What were the discussions you were having at
Headquarters on Monday? What were they related to?
A I think I had made the position that if we were
going to make another flight that we best get better
organized or we were going to lose an airplane and crew
because of the problems we had experienced!
because of the problems we had experienced going inj
that, you know, obviously the first one was
an impromptu thing, we threw it together, and did it in a
hurry. Let's take the necessary time if we were going to
do a second or third flight even, let's take the necessary
time to make sure the proper clearances and so forth were
in place and it is my remembrance that part of that day
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was spent addressing those issues and although I wasn't
a party to those meetings my only contact that day was with
|ans
Q What meetings did you understand were taking
place that day?
A I don't know that there was a formal meeting other
than them going and talking to other people. I don't know
who the other people would have been.
Q Who is "them" that went and talked to other
people?
^^^^^^^^Hlana^^^^^^^^^^ In
was more than^^^^^^^^^^than^^^^^^^^^Bin
think^^^^^Hwas back running the whole thing at that time.
Q . You don't know who it was who he was talking to?
A No.
Q Were you aware that a Spot report had been
prepared that day?
A No.
Q Let me just show you that document to see if it
might by chance refresh your recollection.
[The document marked Exhibit No. ^m-i follows:]
llMCIifOTEIL.
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BY MR. CAROME:
Q I show you what has been marked as Exhibit 4.
It is a Spot report dated at the top 25 November 1985.
For the record, I believe that this was a document
prepared by^^^^^^^^H Does that document refresh your
recollection on that subject?
A I have never seen the document.
Q Were you aware on Monday, that Monday that we
were talking about, Monday the 25th that a report of the
weekend's activities had been made to John McMahon?
A No. I couldn't say that I was. I would have
probably assumed as such but I can't say that I was aware
that one had been made.
Q Why would you assume that?
A Having worked for the Agency^^^^^^^^H knowing
that we don't do many things without the DDO at least
knowing what is going on, that OGC even in most cases I
assume would have blessed it legally or something.
That would be an assumption on my part.
Having been the proprietary case officer that
would have been the normal procedure, once it was put
together you would take it through the different elements
to make sure you had their blessings and that you were
in consort. So from that knowledge I would assume that
that would be
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Mmm
100
Q So this would have been a type of operation
that you would have thought would have been blessed in
advance by the Office of General Counsel, is that right?
A Yes.
Q Did you later learn that was not the case?
A No, I can't say that I ever learned that it was
not the case. I do know that af ter^^^^^Vmeeting with
the Office of General Counsel it was determined that he
should not make any more flights. I don't know that I
was ever told that we should not have made this flight,
if that is what your question is.
Q But you didn't hear anything that Monday about
Mr. McMahon being very angry or having hit the overhead
when he heard that —
A No.
Q — that^^^^^^^fhad made this flight?
A In fact that surprises me because I think every-
body was elated, you know, was very happy that we accomplished
the flight. That was my impression of my contact with
^and^^^^^^^^B that we had been, you know,
been successful in making the flight happen.
Q Did you see Mr. Clarridge at all on that Monday?
A No.
Q And what were you doing that Monday in the
Headquarters ?
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A Geeze, I -- other than having conversations
with ^^^^Biand^^^H and I am sure I was meeting with
[in reference toF
My recollection goes that we did spend time
discussing that problem.
Q This is another unrelated matter?
A Unrelated matter, that is correct. Normal
administrative things, bringing in memorandums and
whatever just^HHJU^^^^^^^^^Hif was
required. I really don't have any recollection as to what
all I did do that day but it was not devoted just to this
flight. I do know that.
Q But it was your understanding that^^^^^^^^^|
were devoting their time to organized planning
for additional flights on this matter, is that right?
A I won't say organized planning, I would say
discussions because we never did get into organized planning
of any additional flights. In fact as I was preparing to
leave the building that night my understanding is that if
we were going to in fact do it and there was still a
probability I presume, that we would hopefully do that the
next day, but in any case we were slipping or not automa-
tically going to go back and do another flight, and it was
very much in discussion as to whether we would in fact do
it or not. My impression is there was no decision made
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that we are not going to go back or that we are going to
go back until I received a call either Monday night from
lor he informed me that was the result of the
meeting on Monday night on Tuesday morning when I came in.
Q Were there discussions about how this
remaining cargo in Tel Aviv was going to get to Iran on that
Monday?
A No.
MR. WOODCOCK: Did you have any discussions
about Tiow amateurish the operation had been?
THE WITNESS: Only to — you are speaking of
Monday?
MR. WOODCOCK: Correct.
THE WITNESS: Only to the extent that I was upset
that in fact I became upset that night before I think it
was or whatever time it was that the aircraft was sitting
land I was told they would give the crew no
assistance, I beceime personally a little upset at that time
that we had got these guys into this situation and now
there was no diplomatic or whatever. I had visions of
based on^^^^^^^^H phone conversation the guys being
under arrest going to jail or whatever for doing what we
had asked them to do. That is the way it come across to me.
I relayed that, my concern tq^^^^^Hor to
and ^i»S" ^y call back to the extent that there
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was nothing we could do at this point, it was out of our
hands and to tell the crew to get themselves out of the situa
tion as best they possibly could. That upset me as I knew
It would upsetlf^^^^^B Fortunately as I was calling
^^^^^^Hback with this information to tell the crew the
next time you talk to them that we would not be helping
them, that they would have to work their way out of it, he
informed me that they had in fact solved the problem and
were gone. That was the point of discussion on Monday
when I got into the office. That if I am to be the project _
manager in a project of this nature, that if we get our peoplje
in this situation again we must be prepared to back
them up.
MR. WOODCOCK: So you get into the office on
Monday and you are already a little upset because
your crew has been jeopardized^^^^^^^^^^ is that
right?
THE WITNESS: Well, by that time I am sure I had calmed down
considerably, yes, but that was to be the subject of
discussion, yes.
MR. WOODCOCK: You are concerned. You get to the
office and find out among other things this is an NSC
operation, is that right?
THE WITNESS: Yes.
MR. WOODCOCK: And'dicT'y'o'u 'iWP' ^t any point and
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say, look, who are these clowns?
THE WITNESS: No, no, and maybe I let you let
me misspeak when I said it was an NSC operation. I never
considered that it was an NSC operation to the extent that
maybe you are referring to, in other words it was to me a -
the way I took that reference is that it was the source
of the flight request rather than it being the President
or the CIA saying we will do this. We were doing it
to accommodate the NSC. That had no bearing on my
attitude about the flight.
BY MR. WOODCOCK:
Q Let me ask the question again then, since
you understood that NSC was at least requesting the
flight, whether it was NSC operated or not, were you not
concerned about the character of the people who were
behind the flight?
A No. Because I didn't know anyone there.
Q You knew this was a flight undertaken at NSC
request, right?
A That is correct, or so I was told.
Q You did not have an assumption that NSC itself
was operating the flight, is that correct?
A That is correct.
Q Therefore there were persons on whose behalf
NSC had interceded to request the flight, is that correct?
(M!lii<^'flEA.,.
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Was that your understanding?
A I wish you would restate that last part because
I read something in there that --
Q Was it your understanding that NSC interceded
on somebody else's behalf in order to arrange the flight
for the CIA proprietary?
A Yes, that is correct.
Q But not necessarily NSC people, correct?
A That is correct.
Q Well, given -- did you understand that the CIA
knew the identities of these people?
A I didn't understand it or I will say I
didn't understand it but I assumed as much. Back to my
earlier statement that I knew that we or I felt I knew that
we were accommodating either some other country or someone
in making this flight happen, and that was still my
understanding at the end of that day even. I don't think
I understood until much later I am sure that it was in fact
an NSC mission at their request. Does that clarify it?
Q I understand what you are saying, but you have
been exposed to a really bumbling, poorly organized
operation that has jeopardized your crew and you come to
Washington and you are not particularly happy about the way
things have gone over the weekend, right?
That i
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Q And you come to Washington and you find out
that really what has happened here is that persons wno
are probably not NSC people are being helped out by your
proprietary at an NSC request, is that right?
A That is correct.
Q Did you try and satisfy yourself that your
colleagues had established the bona fides of these people
who were jeopardizing your crew?
A No, I didn't. I think it would probably be
inappropriate to question that.
Q Well, I am not asking the question that you
yourself be satisfied but did you try and satisfy yourself
that at least they were satisfied that these were genuine
individuals and not some series of cowboys who were jeopar-
dizing your crew?
A Like I say, I didn't ask that question and I
guess I was comfortable with the fact that that is where
it cVme from. If I may, in fact the tone that I found
out it was NSC may have been to the effect that you know
because I do know having been associated with the Agency
for some period of time now, that we do run a better show
than that and it may have been presented to me that, you
know, some of the confusion was that it was an NSC^
generated mission rather than one we generated internally.
That is not self-serving to say that but I think
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m20 ' that would be the vein that I picked that up that day.
And I may have ]ust said well, that probably explains it,
it was someone else. I don't remember directly or the
feeling I had at that time.
BY MR. CAROME:
Q Returning to a subject that you have testified
about a little bit already, I believe I am fairly
stating^^^^^^^^^^^^^l testimony when say that
yesterday he told us that when he informed you that he had
made the decision to take the plan^^^^^^^^^^^H rather
thai^^^HJ^^^^^H you replied to him, that's good,
fact^^^^^Bhasal ready told us to get out.
Does that change your recollection about what
might have happened at this point?
A No, in fact I think that may be a misstatement
because my recollection of that at the time of the
event then would not have been that we are going to get
out of it but that we are not going to go back until we get
some clarifications.
I don't think — I know in my mind that we had
not been cancelled as far as knowing we were not going to
go back absolutely cancelled. There was suspicion we may
not go back at that time.
Q Was it the status at that point that there
would be no further flights without some further go-ahead
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from higher authority than CIA?
A Without some further discussions, I would say.
Whether we were waiting on further approvals or not I had
no way of knowing except I had permission to do the one
flight and we were not to move the aircraft until we had
further clearance and I didn't ask for clarification or,
are you waiting for higher approval or what. That was
just my understanding as to what my instructions were
to do.
Q If we could turn to the subject of overflight
rights^^^^^^^^^B you have testified that the
plane had troublesl
[is that right?
A . That is correct.
Q Did you ever talk tcj^^^^^^^^^^B about the
nature of the application for clearances for flight
clearances |
A Maybe to the extent — I don't remember a
specific conversation other than it seems like I
vaguely remember him making a comment that we would
get our own clearances in the future or any future flight
that we would get our own clearances rather than allow
someone else to get them.
Q You had had a conversation with the|
people about at least assistance?
HASiSra-
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A That IS correct.
Q Assistance by them in getting flight clearances
is that right?
A That is right.
Q Who did you deal with on that point?
A That would have been I am sure
Q There is a CIA cable that refers to a
telex from the carrier stating that the cargo being carried
by the plane was medical supplies.
Do you have any knowledge of that telex?
A No, but I am sure that it happened because that
[favorite for cargo that we don't know what
it is, it is either medical supplies or construction
equipment ,
But I have never seen the telex
and I don't remember him dictating that to me that he had
sent a telex to that effect.
Are you saying it originated from
Q I believe that is right.
A Yes.
Q And when you say that is^^^^^^^^^^^| favorite
when he doesn't know what the cargo is, might it be somethinc
he would use when he prefers not to tell the ground
authorities what the true nature of the cargo was?
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A That is correct;ywhich in this case, number one
you don't know and secondly, even if you did know you
wouldn't want to tell them that it was armaments and so
forth.
Q This same cable states and I will read from
it, the pilot told the ground controllers he was
carrying military equipment.
Did you ever learn that the pilot gave that
information to ground controllers!
A No, I don't think it is in^^^^^^^^Vreport .
I don't remember that being mentioned before.
Q You know nothing about that subject.
A No. Unless I missed it when I read
report and I don't remember reading that, that
he told them it was military equipment.
Q Do you know whether or not the telex request for
clearances sought clearances for one flight or for a
series of flights?
A No, I don't. In fact I am a little surprised
that there is a telex because that would be news to me.
I do know we were hopefully trying to get overflight
clearances but it would have been my understanding that
Mr. Swimmer or someone was arranging them at that time.
So it doesn't surprise me that it happened but I never saw
a copy of the telex and it was not told specifically that
:^£Jf acd it was not told
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imsasEftrr
111
we put in a telex asking for clearances.
Q What problems do you understand that the pilot
had while flying overl
A From recollection he did not have a diplomatic
overflight number that usually works like magic that gets
you past air traffic controllers. Not having a number
and having been told he was cleared to go byl
he was apparently third degreed, he was vectored of
course and in fact he I guess attempted to evade radar
somewhat to get through and in numerous conversations
throughout the flight he was able to actually succeed in
going completely^^m^mUmair space without having
been forced down or stopped.
But he never did have carte blanche authority to
proceed but he did proceed.
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BY MR. CAROME:
Q And what about the problems with|
authorities on the way back?
A On the way back I guess he really didn't have any
problems other than he was informed that he would not be
allowed back through unless he hadJ
Icommercial approval. Apparently that was the
genesis of the problem beforehand, is that the civilian
community or commercial author it ieslHm^^^HH had given
overflights, but^^^^^^^^^^Hwas not made aware or had not
granted their overflight.
So^^^^^^^^^^^H was made aware that he would not
be allowed back in unless heJ
Did^^^^^^^^^^^l inform you of how the
[flight was received in Tehran?
A In this report, yes.
Q What did he tell you as to whether or not the
people on the ground in Tehran with whom the flight crew
was dealing were pleased with the flight and the cargo?
A Just that, that they were pleased and that they
were wanting us to be the ones who brought in future flights,
the impression that our captain had was that we want you to
be the ones who come back in and that was in his report.
Somewhere I remen|;:pft ItAjt A>^SinC% i.pp'tliMl^ebrief ing.
nmssffl'
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1 Q Do you know whether or not anyone on the ground
2 inspected the cargo in Tehran?
3 A No. In fact, I think it was not inspected, as I
4 remember reading through in the discussion of it, that they
5 3ust offloaded it. In fact, our crew was amazed that they
6 offloaded it so quickly compared to how long it took to
7 onload.
8 Q Did you at any time either on that Monday, the
9 25th, or anytime thereafter, hear anything about the fact
10 that the Iranians were unhappy with the cargo?
11 A No. I never did. Until the T.V. told me in
12 December, I guess. No, I never heard that. And apparently
13 the crew never heard it, as it wasn't mentioned in this
14 report, to my recollection.
15 In fact, maybe it will save you some questions,
16 once this report was written and turned in our focus was on
17 other things. The flight, we never talked about it or
18 discussed it.
19 It wasn't a day-to-day type thing. It was over
20 and behind us and I never thought anymore about it until the
21 investigation started.
22 Q Are you aware that^lHHl^^lreceived about
23 $127,700 in payment from
24 A Yes.
25 Q — from the Lake Resources for the flight that was
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performed.
A Yes, I am.
Q Did you know at the time that it was Lake Resources
that made the payment?
A At the time they made the payment I did because
we received the accountings. I didn't focus on that, to be
frank. The reason I say I knew at the time is I approve
all paper transactions as they come through the office and
as they are booked, so I am sure that I saw the name and the
amount and tied it to the Iran flight.
I put it in the file. I didn't know who Lake
Resources was. nor did I question it. When I was questioned
r
as to who it was, I couldn't remember and I had to go back
to the file and dig it out.
MR. CAROME: Could you mark that as the next
exhibit, please?
(Whereupon, the document referred to was marked
for identification as Exhibit^^^l 5.)
IINClASSra
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BY MR. CAROME:
Q I show you what has b-en marked as Exhibit 5 and
ask if you recognize what that document is.
A Yes, I do.
Q For the record, it is a one-page, typed memorandum,
re: Tel Aviv/Tehran flight; is that correct?
A That is correct.
Q This something that f^^^^^^^^^H prepared
and sent to you; is that right?
A That is correct.
Q Do you know if he is responding to a particular
question you had to him in this written report?
A I think so. And I can't give you a specific
consideration but I think I may have made the comment that
what do you think our exposure was on this flight as far as
me being concerned with cover and security in the future of
the project.
And this would have been the response he gave in
response to that query as to did he think that at some point
in the flight did it become very obvious that we were CIA-
sponsored or whatever and this was in response, I think, to
that question.
I don't specifically remember that, but I do think
that would have been the beginning of this particular annex
to the report.
wmm
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IINIMSSieiitT
116
"AS-S ^ Q And I take it it was important to you and
that both Copp and Schwimmer not become aware of
the CIA background °^^^^^^^^^^M ^^ that correct?
A That is correct.
Q And it was that concern that caused you to ask
to prepare this memorandum; is that right?
A I don't think I asked for a memorandum. I think I
asked him and he verbally briefed me and gave me this on
one of the papers in which he expounds on how screwed up
it was, but he gave me the report as a result of a verbal
conversation.
And as I read through the thing, I do remember
discussions -- probably a specific question for me is how did
he explain to^^^^^four missing the flight and actions
they would take as a result of our missing the flight we had
scheduled .
Q Were you aware that the loading of the flight in
Tel Aviv was being handled by high rzmking military officials?
A Yes.
Q ^^^^^^^^^^^M made you aware of that at the time?
A Yes.
Q Did he also make you aware that the loading was
taking place in a hot cargo area?
A Yes.
Q He did tell you that?
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UNCBi^mi^^
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1 A Yes.
2 Q Did that cause you to conclude that this was
3 probably munitions that were being carried on the flight?
4 A I can't say that I recollect having that light
5 come on and say it must be munitions because we often unload
6 in hot cargo areas.
7 That would probably be a tip-off that that would be
8 it. I don't remember elaborating on the fact that it was
9 a hot cargo area, it must be explosive or something.
10 MR. WOODCOCK: That information you are receiving
11 f rom B^^H^^^^^Hon the military involvement and the
12 loading in the hot cargo area is information you are
13 receiving roughly contemporaneously with those events; is
14 that correct?
15 THE WITNESS: That is correct. In fact, I
16 remember that a civilian was obviously running the show, but
17 the military was involved and the civilian was very abusive
18 to the military. I remember him making that statement.
19 BY MR. CAROME:
20 Q Did he tell you that that civilian was Mr. Schwimmer
21 A Later he did, yes.
22 Q On page 4 of Exhibit 3 there is a reference to the
23 aircraft being parked at the same location that it had been
24 parked on the last night to Tehran a few weeks ago. Do you
25 know what that is referring to?
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A Yes. That was referring to the August 1985 flight.
Q And even though it says a few weeks ago, you still
believe that to be the flight that was a few months ago,
is that right?
A Yes. That is the only flight we had made so that
would be the only way I could refer to that.
Q Did^^^^^^^^^^^^ tell you over the phone on
Sunday or Monday that the Iranians on the ground in Tehran
had said they were expecting four more flights?
A I don't recollect him telling me that. I
recollect reading it in his report after the fact, but I
don't recollect it being a point of the conversation by
phone.
By that time it would have been an international
call and we were very guarded as to what we were saying by
telephone.
119
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119
MR. CAROME: Could you mark this as the next
exhibit?
(Whereupon, the document referred to was marked
as Exhibit^^A 6.)
IINPI K<iM
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BY MR. CAROME:
Q ^^^^^^^^^^^I am placing before you Exhibit 6. This
actually is a cable that I was reading from before and
hadn't made a part of the record here yet, but now i would
like to.
This appears to be a cable from'
Ion the 25th of November, that would have been
the Monday where you were at headquarters. It is the cable
that refers to the pilot having told the ground controllers
he was carrying military equipment.
The time on the cable, time of receipt appears to
be^^H^^^ltime. I gather that would be about!
on Monday morning?
A That is correct.
Q At the top there is a reference to "advance
notified C/EU^\j I take it that that is Clarridge, and
then^^^^^^H^^B, spelled^^^^^^^^^B know
whether or not that is the^^^^^^^^Vor not. It seems
that it might be. I am asking you whether or not you have
ever seen this document before, whether you might have seen
it on that Monday?
A No.
Q You have no recollection of ever seeing this
document?
No. Th
it^iMraFiFn
have seen it.
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imsa»E»T
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5"^° '' "R- CAROME: Would you mark that as the next
2 exhibit, please?
(Whereupon, the document referred to was marked
for identification as Exhibit^^R 7.)
UNCLASSIFIED
122
CAS- 11
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UNStASMi'
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BY MR. CAROME:
Q I show you what the reporter has just marked
Exhibit 7 , as I ask if you recognize what that is?
A Yes. That is a paper that I prepared for
lat his request. I think -- it could be one of
two things. It is a paper I prepared for^^^^^r it is
something I prepared for the auditors when they were down this
year — I did it for both, I think.
Q Is this a listing of the special flights, that is,
the fli/ghts carried on at the Jsehest of the U.S. Government
that^^^^^HHHperformed in 1985 and 1986?
A Yes. I am sorry. That would not be a total
list, okay? This would be the list of special flights with
So it would not be all inclusive is what I am
saying.
Q And the one item — let me rephrase that. The
fifth item on that list, do you recognize that to be a
reference to the November 1985 flight that we were just
discussing?
A That i
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w. .w«. .WW.. ..i.r 123
Q Can you read to me what that item says?
A Part of it is blocked out, but it apparently would
be Boeing 707, 23-25 November 1985, Tel Aviv social.
Q Can you read the word underneath that?
A No, I can't.
Q Does it say "cash"?
A Maybe it does say "cash" -- it looks like it does
say cash and I have in the remarks there "p»id direct by
customer^ and I did not have the hours or the amount there
either', but I can't tell whether it was there or not. But I
did have 707, 1-27-7, plus -- 8-7. I don't know what that is.
In fact, I am not sure that is my writing.
Q It may be that the last column is someone else's
writing; is that right?
A Yes. "^
Q Do you know what the^^^B numbers might refer to?
A No.
Q There is a handwritten note in the middle of the
page that says "no cargo manifest available '1. Do you know
what that refers to?
A That is not my writing, but that would mean that
I have no cargo manifest for those flights. If it would be
proper, I can now tell you whose writing that is or whatever
the source is.
The ai
T^ v^Sen wie investigation was started,
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the auditor plus one individual come down to my office to
audit the flight records for all of the flights we had
conducted for the agency and this is a copy of -- in fact,
it is a copy of a manila folder that I keep handwritten notes
to myself of date and time of flights.
Q Is this audit something that was conducted as a
result of the public disclosures of the Iran affair?
A I would say yes. I had a — after the disclosure
of the Iran affair, I had a debriefing with our internal
auditors and the I.G. staff, O.G.C.
After I had the session with them, the auditor
left Washington with me that evening and went back^
^^^^1 and spent two or three days looking at the
paperwork I had in my office.
Now that I pay close attention to that, that is the
origin of it, I think. That would be his co^e on the
as well.
That is his writing. Just to clarify it more,
normally I would put the amount of money that we collected
for the flight I said "paid direct by the customer" and
at the time I made the entry I didn't know what the amount
was.
That is his writing in the right-hand column.
Q Did the subject of insurance ever come up in
connection with the November^^^^^^^^^Bf light to Iran?
the November^^^^^^^^|Hi
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A Not to my recollection. We had a discussion on
insurance back during the August flight but I don't
remember^^^^^^^Hasking me about insurance or me
questioning him about insurance for the November flight. We
had to buy special insurance for the August flight. I
remember that.
Q Do you recall how much that special insurance
cost?
A I want to say $3,000, but I don't know where I am
getting that, so I would rather say I don't know.
Q But it was probably less than S5,0Q0; is that
right?
A I would think so, yes. I think I can safely say
that we did not insure for this flight because it was a
weekend and we didn't have time and the subject never came
up, so we didn't contact our broker.
MR. CAROME: Could you mark this as the next
exhibit?
(Whereupon, the document referred to was marked
for identification as Exhibit^^^^ 8 . )
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BY MR. CAROME:
Q I show you what has been marked as Exhibit 8.
Do you recognize what that item is? It is a one-page
document dated 30 November 1986.
A No. I haven't seen this.
Q Is that also a document that is in the auditor's
handwriting?
A Yes. Thel^^^apparently collates back to the notes
he has in the margin.
Q There are several -- do you know what the term
"special interest" means at the bottom of the page?
A I would assume — looking back I would assume that
it would be the flights that they were looking at to see
whether they were properly approved or executed or whatever.
That is his word, but that is what I would gather from looking
at it and tieing the two together.
^^^^^^^^^^^^^^HtTii s
equipmenty^'iy and those words are in quotes, to Tehran. Do
you know why it says "drilling equipment" there? That appears
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to be a reference to the November 1985 flight.
A No. I am not sure where he got the words from
except that that was used at some point -- as I testified
earlier, that it was said that it might be drilling equipment
that we were transporting and I am not certain where that was
coming from.
Q Do you know why that would be in quotes?
A No.
Q Let's see if we can sharpen up the reference to
drilling equipment that was made in 1985. Who do you recall
saying that the cargo was drilling equipment?
A My recollection would be when we were trying to
apply for our overflight rights, part of the request has to
include cargo, consignee, consignor, and that type stuff,
and my recollection would be that I would have asked either
and I don't recollect which, for this
overflight to get our aircraft^^^^^^^^^^H to Tel Aviv —
I am sorry, from Tel Aviv^^^^^^^^H what the cargo would be
and someone in the process told me to use the term
"drilling equipment r(,i or it could have been that^^^^^^^^H
said I will use the word "drilling equipment(''\./ I don't have
a clear feel for that.
Q Did you understand that drilling equipment was an
actual description of the cargo or rather something that was
being suggested as a good l4£)^ -fflSJil^ cargo for air
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clearance purposes?
A I think I held that that is what it was at the
time and that is why I am having problems remembering as to
who gave it to me, is that maybe that was my understanding
that it was drilling equipment being shipped because of the
sizes.
That would have been a feeling at the time that was
later gone as a result of finding out or hearing the
description that it might be missiles. I have an unclear
feeling did I get that f ron^^^^^^H or was that something that
^^^^^^H suggested.
Q I^^^^^^^^Hsuggested it, presumably that was
being suggested as a good label for it and a good cover for
it rather than an actual description; is that right?
A I tend to think I got it from^^^^^| Yes, that
would be a true statement if that is the case.
Q It is your testimony that at the time — let me
rephrase that question.
It is your testimony that at the time you were told
it was drilling equipment or at least at the time you were
told to describe it as drilling equipment, that you felt that
was an accurate description of the true nature of the cargo?
A Yes. I didn't speculate that it might be anything
different at the time. That is why I tend to believe that
I got it from the
people rather than from^
a.
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not being able to recollect exactly where the words
"drilling equipment" -- to be honest, I thought that I had
been told that in the first phone conversation with^^^^H
When I went back and read the notes that said "very
sensitive cargo'.i, I realized that is not where I got it from.
Q Is there any reason why drilling equipment would be
a very sensitive cargo?
Those are kind of inconsistent concepts, aren't
they?
Pi- Yes and no. I guess I consider myself fairly
well read that we weren't trading or were trying to
discourage other countries from trading with Iran and the
fact that we were ordering drilling equipment would be
almost on the same level of shipping missiles.
If you say you are not going to give them anything
and all of a sudden you are helping them because of oil and
knowing that Iran is a big oil reservoir, I would say in
international politics that might be just as important as
missiles.
That is off-the-cuff. I didn't think about that
at the time, I am sure.
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Q In any event, by Monday you no longer believed it
was oil drilling equipment; is that right?
A When^^^^^^Hmade the comment to me by phone on
Monday .
Q At that point you no longer believed it was oil
drilling equipment; right?
A That is right.
Q And you believed it was missiles; is that right?
A Well, I can't say what I believed, but, yes, I
accepted it on faith that the' crew thought it was missiles.
MR. WOODCOCK: Let me pursue this line just a
minute in a different way.
BY MR. WOODCOCK:
Q When you first heard from — when you hear from
Ion the 23rd at 10:00 a.m., he is telling
you that this is the same cargo]
land you understood that to be a ship-
ment of arms; is that correct?
A Shipment of munitions, yes.
Q He then later tells you that he has been in touch
with the captain, he has arrived in Tel Aviv, that he is
at a military portion of the airport and that military people
are involved in loading the cargo up; is that right?
A Yes.
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EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE
BY MR. CAROME:
Q You also were told that was being loaded in a
hot cargo area; is that right?
A Yes, by him or in a report, but I feel sure he
told me by telephone.
EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE
BY MR. WOODCOCK:
Q Up to that point is it correct to say that the
information coming f rornj^^^^^^^^^^^^^^^^ would lead you
to suppose it is military equipment rather than something
else: is that right?
A If I had been questioned at that time I would
have to say, yes, yes, that the fact they thought it was
the munitions flight, but you have to recognize that I
don't think we had a description of the cargo other than
what^^^Hgave me earlier from the crew or anybody at that
point, but when the destination changed or whatever tipped
him, he thought it was the same flight.
I honestly did not dwell on it at that time. We
were trying to get the thing going.
Q The reason I am asking these questions is I am
trying to separate in your mind to a greater certainty
where this information about oil drilling equipment may
have come from.
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Up until this point, until the point where you
are talking tc^^^^^^^Hand he is giving you ' information
on the hot cargo area, the military area, and they think
it is the cargo he turned down, your impression is that he
is talking about a military cargo; is that right? At
leastj^^^^^^^^^Hunderstands the impression that it is
a military cargo?
A Yes, I would guess that would be true, yes. That
is about the same time we found out the destination was
changed, to clarify my recollection of that,
i f ^^^^^^^^^^^^^^^P s u d d e n 1 y
the term oil drilling equipment, that either means he has
come across startling information or he just made up a label
for it; is that right?
A Yes, I think I have to agree with you on that.
That is probably correct — from that perspective. It would
probably not have come from him. I think it did more than
likely come from within!
Q Let me follow that down a little bit further.
Since it is likely that the information came fromi
that it was oil drilling equipment, that would
have been contrary to the information you were receiving,
or at least the impression you were receiving fromj
is that correct?
A If I_ had ieroed_.ii. p2i.J:ii^ij yes. But I don't
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remember zeroing in on that or focusing on that at the time.
0 Then you come into headquarters on Monday and
Igives you the final piece of information and that
is that the pilots who were involved in act(4jUly seeing the
cargo, believe it was missiles; right?
A That is correct.
0 Now, do you at that point think that your colleagues
ire mistaken or that they have just made
up a label to falsify the character of the shipment?
A _ I don't have any recollection of focusing on that,
but I guess the fact would be that maybe they had falsified
the shipment to, either because we were on the clear from --
I am not trying to excuse them, don't misunderstand what
I am saying — just never asked the question beyond what I
would normally ask, what I show is a commodity, and so forth.
Even though they would have told me it wouldn't mean I
would genuinely believe that is what it was, but understand
the circumstances here, I would have thought that would have
been the case.
Q If you had thought they were genuinely mistaken
about the character of the shipment and you were well
persuaded it was armaments, and not oil drilling equipment,
wouldn't you have wanted to make sure they were disabused
of any illusion?
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A If I had been more sure — and that is the problem
with this, because we didn't press that point.
In fact, in pressing^^^^^^H-- no, not pressing
him -- in discussing this later he wasn't convinced what it
was in that the crew mentioned as I described, the co-pilot
said, "We should have fired them instead of delivered them,"
and they thought because of the shape of the box and the
way they were handled, they must be missiles.
But they never made a firm statement that they were
missiles to the degree that I could come forward and with
any degree of assurances, give a good, intelligent report
saying, you guys thought it was something else, and in
fact, it was missiles. That part was never clear enough.
Q But they are in a better position to know that
than you; right?
A I would suspect so. Yes.
Q If you have a reservation you are not in a position
to find out to a certainty what the cargo is; is that right?
A Without asking, without making a point of it with
them. If it had been something I thought to pursue, I could
have asked them. I didn't.
But your CO 1 league ^^^^^^^^^^^^H are presumably
in a position where they would be able to take the informa-
tion you gave them on it and corroborate it one way or the
other; is that right?_. _ ___-
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A I would say so, yes.
Q So you wouldn't know until you knew something to
a mathematical certainty until you came to them and
said, guys, this is really armaments; is that right?
A Yes, I would agree with you, correct. Yes, in that
assumption.
0 So you would
A I would not expect an answer back.
Q Right. But you would say, look, I don't know
whether this is important to you or not, but all my
conversations with^^^^^^^^B including this last one,
would indicate it is military hardware. You can take that
and do with it what you want.
Correct?
A Yes, that is correct.
Q Is that what you did when you got tc
You had this final phone call and you are talking, it is
second-hand information, but it is based on an eye-witness
account, that act^)illy the cargo is armaments. Is that what
you then do witJ
A I don't remember it that way. I remember reporting
to him the status of the aircraft, and what H^^^fH had
reported to me, and part of that, part of my recollection of
that is that I would have told him that^^^^^^^fsaid the
crew thinks that it was missiles, and that was the —
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dropped it there. I don't remember discussing it any further
or me asking was that true, or could it be, or something else.
I just don't remember pursuing that issue.
And it is my nature that I would not have, because
if you want to talk about some other flights, I couldn't
tell you what is on those flights either-- you know,
exactly. I never saw the cargo documentation. I wasn't
physically there for the loading. I can relate a humorous
thing to you, we hauled one box and the crew said it had
to be money, they weren't paid that much to ship that small
a package.
That is the comments, I guess. I don't pursue
them.
Q Wouldn't you pass that on as intelligence? You
are a proprietary.
A I did. And I think I did that in debrief in
as to^^^^^^^^l comments that the crew had thought they were
missiles. That would have been the extent of the pass on.
Q I understand your role. Your role is not to find
these out, but your role is to pass information on?
A Yes.
Q And let them make a determination; is that right?
A Sure.
0 Presumably that also employs that you give them
as much information as you can so they can make an intelligent
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decision; is that right?
A That is right. I would suspect that -- I shouldn't
do this 1 suppose -- but I would suspect they either knew
or it was not important or germane afterwards , because I
never got quizzed again; where did that source come from?
Nobody ever pinned me down to say, you said it
was missiles, what made you think so, or whatever. I
don't remember one conversation I had. It never came
up again.
' In fact, the flight never came up again after that
cay.
EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE
BY MR. CAROME:
Q On explanation might be they knew and therefore
they didn't need to check back with you?
A That is the part, as I say, I shouldn't speculate,
but, yes.
Q That is one possible explanation?
A Yes.
EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE
BY MR. WOODCOCK:
Q You testified earlier that you anc
went out to get a drink after work and that he was called
at that byl^^^^^^^l is
In' t qo. We were on th
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EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE
BY MR. CAROME:
Q Do you remember what time of day that was?
A I would guess 1800, 1830. That is normally the
time we would leave the office during a visit. I don't
specifically remember it being that time, but I would guess,
EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE
BY MR. WOODCOCK:
Q 6:00 or 6:30 p.m.; is that correct?
A Yes.
Q You also testified that^^^^f called you up you
thought, either late that night, or early the next
morning; is that right?
A If it was the next morning -- I know he called
me that night. Whether he told me that night that we
definitely would not be making a flight for whatever reason,
that night or if we waited until the next morning, I don't
know. That is my problem of recollection. He tells me
that he told me that night, and I remember we purposely —
if you don't have to talk on the phone you don't usually,
and you wait until the next morning.
In my recollection, he told me the next morning.
In his recollection, I think he told me he told me that
night. I don't dispute that.
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EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE
139
BY MR. CAROME:
Q You came into the headquarters the following
Tuesday morning; is that correct?
A Yes.
EXAJ^INATION ON BEHALF OF THE SENATE SELECT COMMITTEE
BY MR. WOODCOCK:
Q When you get to see^^^^^the following day,
did he mention what had occurred at his briefing of the
general counsel?
A Only to say it was determined we could not would
not make any further flights; that that was the end.
Q Did he say any discussion was -- as to whether that
flight was even legal or appropriate , in any event?
A No. I can't say that he did.
Q He didn't say, for your information you ought to
be aware that in future flights like that we are going to
check out all the numbers.
A I can't say thatthe even inferred that to me. In
fact, if I had to give you my impression, I would say
that I don't know that that happened because I don't
recollect him coming and saying we shouldn't have done that
flight; if that is what you are asking?
I do recollect him saying we cannot do those flights,
and that was what I got out of that conversation.
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Q You don't recall at any time, I gather from your
earlier testimony, telling^^^^^^^Habout the remark that
[had told you on the 25th about the missiles'
A No.
EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE
BY MR. CAROME:
Q Did^^^^^^Hsay anything about a discussion of
need for a covert action finding like that after his
discussion with the headquarters?
A No. I don't remember if he did. Like I say, I
would assume that we had all that before we went. I
haven't done that job before. I know no matter what time of
day or night or weekend, whatever, you did that, like a
check list.
Q To make sure there would be a covert action finding
before this occurs?
A The OGC would provide that. I never look at the --
as the case officer, I never would see that, but everything
would be staffed through, all the way up to the DDO,to release
the flight or whatever.
Q You understand
A I naturally assumed that had been done in this case,
and as I assume it is on the rest of the flights.
Q You understood that to be the norm?
A That is correct.
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Q For special flights, is that right?
A That is correct.
EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE
BY MR. WOODCOCK:
Q Let me ask you on a slightly different "ifctack
here, you earlier testified that you operated under guidelines
that prevented you from delivering to certain
is that right, without special permission?
A Without permission, yes. Or we just didn't do it
without special permission.
Q You have also testified that in your opinion the —
°"<=€ ^mm^H^^^^Hproblem taken care cargo
really isn't all that important, is that correct?
A That is rightg)
^ I would say that I may have misspoken if I did
say that. I would say that the cargo would be just as
important as the destination
^^^^^^^^^B I presume we are talking about commercial
"°^' ^^^^^^^^^^^^^^^^^^^^^^^^^H the Iran
flight, whatever, ^^^^^^^^^^^V we would fly into, we
would obviously want to know what cargo we are transporting
to the best of our ability, so that would be to me as important
as the destination.
Q But you are speaking in terms of knowing what the
cargo is in order to get the information back so it can be
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analyzed and taken care of by the CIA.
A That is correct,
Q You are not speaking of this in terms of whether
the cargo would make the flight permissible or not; is that
right?
A That is correct.
Q Now, I just want to pinpoint this because it,
frankly, confuses me. If you had a commercial individual
call you up and say, look, I would like to transport a
thousand tons of C-4 explosive to Libya, wouldn't the cargo
also create a problem for you as well as the destination?
A Yes, it would. And, in fact, to elaborate on
that, if he said he would transport a thousand tons of C-4
to Germany, that would be a tipoff that I would pass that
to headquarters, say, we are moving froih Israel or any place,
because of the type of cargo in that regard. -^
It would be of interest to me, would ^(MJwPiTiy
K
interest more than if we were transporting chickens or
cattle, or anything else. So, in that regard, even though --
this is almost — ^^^^H|^| didn't have a piece of paper in
his hands from rae or I from anybody else saying, if you
ever get approached about a flight to Iran or Russia, or
whatever, report it. It is our understanding that if it is
a flight, if the flight looks out of the norm, whether it is
the cargo or destination, or combination of both, that we
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would report it to be sure we had concurrence to do that
flight.
Q Presumably the customer or the destination, even
no €^^^^^^^^^^^^H or a
recipient, would prompt you to seek further authorization;
is that right?
A That is right.
Q So if it were a flight of a thousand pounds of
C-4 explosives to Ireland, but the recipient was the IRA,
you would want to check with headquarters to make sure that
that was okay?
A That is correct, that is a correct assumption; yes.
Q Just wanted to be clear on that. I will sleep
easier tonight knowing that.
A Or drugs. The reason I balked at that question,
is because we have had flights from, since this whole thing
has come up,
wouldn't be hard to determine if that
is true, of course, but we would not make that flight in
there because we are exposing the aircraft, crew and et
cetera ^^^
Q In this August flight to Tehran, did you have
the crew prompted so that it could, it would corroborate
that what was going was this gunpowder rather than something
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else?
A I didn't, because I didn't talk directly to the crew
My only question to^^^^^^^Hwas to try to get -- normally
we would not have a copy of the manifest that we can keep,
although the crew handles the manifest. Once we got approval
for the flight, I coached ^^^^^^Hto try to have the crew
get the paperwork on the flight so we can see what he had
been told, whether it be true or what we could glean from
that paperwork.
It was some time afterwards we got it, because
maybe the captain had it in his bag and we had to go back and
ask him for it rather than it being an automatic thing.
Q That flight ran, according ^°^^^^^^^B didn't
go exactly as planned, and according to his testimony
yesterday, he was not sure it had made its way all the way
to Tehran out of that flight?
A I have recollections that initially my understanding
was — I am going from memory, but if you give me a piece
of paper, I can confirm it -- we had cargo
I don't remember cargo specifically
5ther than the flight was originatin
buti
I remember^^^^^^^^Vcoming to me that th
cargo did not show up and we went out much later than we
thought we would, and that was the cajgo that was missing.
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Q Some of the information that was created contem-
poraneously with that flight, indicated the cargo might also
include detonators for the explosives?
A Yes, I remember seeing that on the manifest.
Q There are a wide variety of detonator explosives;
isn't that right?
A That is true.
Q Some are extremely sophisticated, and are extremely
small; is that right?
A That is right.
Q In fact, so small you could put it in a letter and
if somebody opened it up that would be the end of them;
is that correct?
A That is correct.
Q Were you and^^^^^^^^^^^H on the same wave length
so that those detonators were nqt being brought into Iran
by|[H^^^H
A No.
Q Thank you.
A We had no restrictions to enforce, in other words,
enforce -- if I understand your question, we had no
restrictions to go on board the aircraft and say we will
take the black powder, but we won't take the detonators.
There was no guidance to that degree.
IIMPiACCinrn
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I don't remember detonators being mentioned
until after the flight, and they showed up in the manifest.
Originally we were told it was munitions or black powder.
Q That would be a point of concern to you looking at
the manifest afterward, seeing that the detonators were on
on there?
A It was a point of concern, not that we were deliverir
to Iran, but because you don't as a rule carry detonators in
the same flight with black powder and because you have a
dan'-2r^ of in-flight explosion because of static electricity
or whatever.
Q You don't know if you have those super-sophisticated
detonators that, say, ^^^^^^HciA might be able to produce,
but most people can't?
A I wouldn't say that is my job, no. I can't say
that I would have any concerns about that. I would think
that once I — the one thing I find as these go in my
years of experience, is most of the stuff I report is not new.
It verifies something they know already, or something like
that, or it helps them verify something. So beyond the
reporting and saying, yes, you got my clearance to make the
flight I wouldn't question anything. I wouldn't have
reason to. I aim not a
Q You would make sure that CIA knew that these were
suDer-sophisticated detonators?
IIMPI APOinrn
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A If I knew they were on board that would be part of
the intelligence, yes.
Q But not necessarily part of the approval?
I just want to understand how this process works.
A It would be after-the-fact. I don't know that
the fact that there were detonators onboard would impact the
approval or not. I don't think so. But that is my opinion.
Q Might depend on the detonators?
MR. PEARLINE: Off record a second.
(Discussion off the record.)
MR. CAROME: Back on the record.
EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE
BY MR. CAROME:
Q I believe that yesterda^^^^^^^^^^^^^testif ied
that one reason that he diverted the aircraft^^B^^^^J rather
than having it go back^^^^^^^Hwas that he had not
received payment from Mr. Copp on that Monday; does that
conform to your recollection?
A I do know that we had not received payment.
I don't remember him relating to that to me in the con-
versation. I knew we had not received payment and we were
then in a position as to even if we had gone ^^^^^^^H how
would we refuel the airplane to go back. The crew was out
of money. I think he started out with a slot of 310,500, and
ad the money to continu
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BKOtWer
14R
funds. I don't remember that being a discussion point.
Q You don't remember whetherg,r not there had been
payment being made, a factor in the decision whether or not
the plane should go back]
A No, in fact — no, I would say that wouldn't
impact it. If I had had instructions to go back we would
have went back ^^regardless of payment. But I didn't have
those instructions. I did not have those instructions.
MR. CAROME: Could you mark this as the
next exhibit?
(The document was marked Exhibit^^|9 for
identification: )
INSERT ^V- 9
iihini mm^w
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149
EXAMINATION ON BEHALF OF THE HOUSE SELECT COMMITTEE
BY MR. CAROME:
Q I am putting before you what has been marked
as Exhibit 9, and I ask you if you recognize what that
document is? Is this a document that you prepared?
A Yes, it is.
Q And do you know who it was written to? It is
blacked out there, but do you know who this would have
been prepared for?
A" I believe, I would have probably addressed it to
chie^^^^^^^as a formality, but it was requested by
And do you know when he requested that you prepare
A The date there tips me off of December 1, and I
think I stated in the thing 30 November, yes, that refreshes
my memory. That is the date.
Q Did you come^J^to Washington to work on the
review of the 1985 flight activity?
A No. In fact, I can't remember the purpose of my
visit, but I was surprised if this is the correct date even,
that is I come into the building, I have to get a visitors
badge and be escorted from the front door and the secretary
me^^^HM for a i noj^^^^^H
for normal business. She said, I think you. are supposed
IIMPUOOinrn
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to be in a meeting at 11 o'clock, and at that time it was
like ten to ll-rJBfl": I said, I was not aware of it. I went
witt^^^^^and by tim^^^^^^^^^^^H and
come 11 o'clock, they said let's go. I said, I will see you
later and they said, no, you are going, too. That was my
first indication.
The purpose of the trip was not for a meeting
but I did attend the meeting.
Q What was the subject of that meeting?
A Apparently an internal investigation or internal
audit as to who did what during this thing, this flight
series that we had done under question.
Q 1 notice that the second paragraph of this Exhibit
9 says, I believe he listed oil drilling equipment as the
cargo as this is what we were orginally told the load was.
At the time you are writing this, you understood
that the load was not oil drilling, I take it; is that
fight?
A Right, well, I still don't know for a fact. But
yes, I would assume that that was not the case. I am saying
what I think he wrote down.
Q That is right.
And does this reinforce your recollection that it
was probably^^^^^^who told you that it was oil drilling
equipment?
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tMASSIFIS'^
A Reinforces the feeling that I was told it
drilling equipment. I can't say it reinforces that
^^^^H who told me, but I do believe that is who it
Q You mark this as the next exhibit.
(The document was marked as Exhibit^^^lO for
identification: )
INSERT B-10
151
was oil
it was
was .
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BY MR. CAROME:
Q I show you what has been marked as Exhibit 10.
I ask if you recognize what that docu.iient is? It says
at the top "reimbursement." Is thanyour handwriting?
A Yes -- no, no, I don't think so. Probably
looks a little too neat for me. It even looks -- because
of the eiTth'l, six, seven -- I would guess that is the
auditors. It could be the guy with him and I don't know his
name.^^^^^^l I do remember that. He had another gentleman
with him. It could be his handwriting.
Q Do you know why the subject of reimbursement
would be discussed in the same context as the $127,000 pay-
ment to Lake Resources?
A I don't know why it would have been discussed
in this, except that that was part of the subject of the
internal investigation or the internal deal when the auditor
came down is to determine how do we get paid for this flight
and why was it different than the other , because they are much
the same as you are, coming in not having any prior knowledge
of it. We went through a deal to explain why that was the
case,bs far as I understood it, that I was told we would
be paid directly by the customer, and in which case, we were
paid directly by the customer. That would be my only
explanation. That is speculation on my part, I should say.
end jm
\\m K^^inrn
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(Wssw
153
MR. CAROME: Who was it that told you that the
NSC had requested that this flight be done?
THE WITNESS: I would say ^|^B on Monday
after I had talked to him about the problems that we had
had. My recollection I had never heard the NSC mentioned
by telephone over the whole weekend until that Monday.
Sometime during that day I was told and I think as I
testified earlier I think it was in the vein that I am
talking about how messed up things were and they said well,
we were responding to a request -- they were giving the
excuse to me that it was not a normal flight, therefore
they didn't screw up, someoby else did.
BY MR. CAROME:
They were passing the blame to the NSC, is that
We didn't do the planning part, not the staffing
Q
right?
A
part .
Q What do you understand Dewey Clarridge's role
was with respect to this '85 flight?
A I would assume that he was the, for lack of a
better word, action officer that^^H^ was working with and
^^B as well because that is the only way I knew the
name was the comment made that I will check with Dewey or
whatever. I never questioned nor nobody every explained
to me. That would be normal, that whatever desk or division
rp
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we were working with would be the people you would have
to coordinate with, so that would be my assumption.
Q And you were not aware at the time that
Clarridge was working closely with Oliver North, is that
right?
A No, I wasn't aware of that.
MR. WOODCOCK: You testified earlier that you saw
portions of Richard Secord's testimony on television, is
that right?
THE WITNESS: That is correct.
BY MR. WOODCOCK:
Q In your days with the Army^^^^^^^^Hdid you ever
come across Secord?
A No.
Q He was a new person to you —
A When you said Army^^^^^^^^H, that covers two
areas. In the Army, no, I had never met him.
Q How about in your capacity as having
responsibility for any proprietaries of the CIA, had you
ever come across Secord before?
A Not him personally, but the name, yes.
Q How was that?
A Another project I was working before I took
the project over when I was a proprietary case officer we
had requests for General Secord and one other individual
WUlSSJjjra-
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BNttiBSfFraT
155
to visit the project and I processed the action on that.
Q You did what?
A I processed the action on that request, which
my understanding is after the fact that the visit never
took place.
Q Did anybody inform you as to what happened with
the request for Secord ' s clearances on that project?
A Informally I was told it was denied but officially
I don't know.
Q_ Did you have any other --
A On one occasion I dropped one of our other
officers off at General Secord' s house. He was visiting
the city or the headquarters and that evening or that
afternoon or for lunch I had occasion to take him in my
private automobile as I was going that way, and drop
him off at General Secord 's house. I did not meet him.
Q When was that?
A I left Headquarters in October '83 so prior to
then.
Who was the officer that you dropped off?
Do you know why he wa|gVi^%jpng General Secord?
I didn't question it, but I had knowledge that
they were friends, that they were acquaintances I should
say.
iiMpi AQQinpn
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UNCM^RpT
What was^^^^H posit ion with CIA?
He was a proprietary manager.
156
At the time he was?
Yes.
Is he still?
Yes.
Did you have any understanding as to what their
relationship was, Secord and ^^^^^|
A Not beyond the fact that they were friends from
years before, personal acquaintances, my assumption was
that it was not business-related.
Q Was Secord still in the Air Force at that time,
do you know?
A I think it was shortly after his retirement.
I seem to have that recollection because I read the
newspaper and the association with the Wilson -T*aa^SFS thing.
But I seem to recall that that was after his retirement
and I can't swear to that. I can't testify to that but
that was my impression.
Q Did you have any concern that^^^^Kwas visiting
somebody associated with Edwin Wilson?
A I can't say I did, no. I did know that they
were acquaintances apparently from the Vietnam era and
probably in my mind wrote it off as simply that.
157
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Q I have a couple more things I want to show you.
These are not in clean form but they are the universal
indicator, CIDJ No. 2554 and CIIN No. 2553. Let me first
show you No. 2553. Do you recognize that?
A I would recognize it as a bank transaction form,
a deposit slip or something. I don't recognize the
amount or the date.
Q Let me show you now 2554. Do you recognize that?
A I would recognize it as one of the checks that
I would have passed tc^^^^^^Hfor a flight that we
did, an operational flight.
Q Do you know whether those two items have any
relationship to the November '85 flight?
A No.
Q In other words, they have no relationship?
A They have no relationshd
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IWCM^ffilF'
159
BY MR. CAROME:
Q ^^^^^^^^B do you have any knowledge of why
the payment for the November 1985 flight was done m two
parts, one of which for $127,000 and one later for
$700?
A It is after the fact, but somewhere, and I
presume you have a copy of it. I produced my paperwork
on It. We had a copy of the invoice, telex, from
to — Mr. Swimmer I thwnk was the addressee
on it, 'giving him an invoice of $127,700 and later telling
him that only $127 showed up and he remitted the $700
later. He apparently had paid $127,000 and had not remitted
the $700 and then did that later.
BY MR. WOODCOCK:
Q I have two more questions I think.
With reference to Exhibit No. 6, I gather that
Inever discussed any part of that exhibit
with you while you were in Washington on November 25-26,
is that right?
A No.
Q Did you see Dewey Clarridge during that period?
A No, I didn't.
Q Had you ever met him?
A Yes, when he was in Headquarters^^^^^B
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mm&
160
MR. CAROME: I don't have anything more. Thank
you very much.
MR. WOODCOCK: I would like to thank you on the
record, ^^^^^^^H for your patience and comingj
and staying over an extra day.
MR. CAROME: Yes, thank you very much.
(Whereupon, at 4:55 p.m., the deposition of
[was concluded.)
UtUHASSlEIEL
161
A\RLIt^E T^oP. PftoJ: OFFICE!^ 2 I *<>o^^i
KEMO 211 183 /^^SSSmh^ 2u
smoN
ONCUSSIFIED
Paniallv Ceclassilied/Released nn "^ '^ /U3g8
unacr provisions ol E 0 12356
dy K Johnson. National Security Council
M^n^
•:. TLH£RAK SiniAlION
flight w«» B«d«^^^^^^^^^^^^^|t^T«h«r2^v^h
was ch*rt cstertTcb^Tranlanfiahitn until 1^ rtachec Te'.«rjr.
T.-.«r« It oa« bor* fit coslag la D«caab«i
IvMeh v» trt nagetlatlng praitntlvj
^Bort ii:t «rt plantwd ^•ginning 86 to go|
< vill b* irfor^ec about thoaa'.
mmmmmmmmm
■•'::i:^-f::>:iUJ''i
0-88-7
162
raK« 4, Hi fiaiMi iMiOJ
S. VARIOUS FITS.
flNMSIflEO
^Ht\>&^«l
*»-:"^';^.f:;v;;:>-
163
nmussim
HNCUSSIfe
V4a
0^0.
1m,' "•■iyi^.:
164
MDIORJoIWh 301185
-<r
^-.^iiyg.
(jj^^llT*-^^'"^.^<»l»«i«" TLV/THR
CHRONOLOCICAL RIPORT '~,.-^^,^-
ttfi._ fUA5t«r - Contacc and Contract
'*Triday afternoon 22 Nov first info to oe vlj
that 1 would b« contacttd concerning an urgent flight and
that It was in our Interest to pcrfora those upcoming fits.
At about 20 00 Loc«l_tlae_I_m_aflailSted by a certain Mr. Richard
Cop pflHHj^l^H^^^^^H^miH'
He aslted'ae wneth^^^nad ^already been informed about a. mission,
which I denied. He then~*T^ained tome that there had to
' 1 1
be 3 flights done
from Tel Aviv
we could do 1
of 60 000.00 USD
Further It was agr
on request should
During By subseque
CO my MEMO JlllSS
to me aod supposed
Indicated. This wa
PHASE II - Position
kly as possible " Government to .Covernxcn
ter a short discussion we agreed that
raft consecutively for a flat fee
landg.handlg had to be paid by hin.
t second Boeing would be nade available
ter get urgent. ^^^^^^^_
e to °ur|^HHHHBl
and questioned the way it was displayed
his cargo was the sane as in my memo
d.
3, 3^ >h
UNCLASSIFtll
Llrcraft was taken over
had the order* that upon the receipt of the code "Celia" he would
find an excuse for the customer and depart
officially foc^HBH^Traffic rights ^^\^^^^^^^^
HHKwerc tea^^vcly applied for by ourJ^^^^l^^^^H should
this become necessary.
Our second Boeing was parked ln|
the airport opened the next morning^
At the time I had made the agreement
Thccrewfl^l^^whlchwa^suDPOsed to ^
MMH||ithe ncx« ^'y^m^^H"**
^^early departure o^ttu^^^raf tj
airport had opened^
aircraf t^^miHH^^HHIHIV At
Jlnformed bv Copp tnac paUets_had to be taken along.
^"^ " own pallets were storec
■ • ^ '■ ^
^^r«l Aviv. A«M«he
SfiCevailable foiNcfuill:
165
'•|t 2 of MDW 301115
UNCLASSiFikD
-i-^JiAagjr.l^^^^Mi^^ Du^^tht»hort*|t of timt w« decided
::'l«c:^tht ilrcrtfc fly^^HIHHMto pick
Itcs had bttn put on • forklilt In cne
inlc was wiitlni for tht. aircraft to
arrivt. Aftar tht aircraft -had arrlvad th« pallets were loaded and
the aircraft continued to fly to Tel Aviv after having refuelled
a little because of the exti ~
In Che aeant ine 'Ca
additional Joadmaste.
were also on board
arrived
Due to this departu^
put the second alrci
urgency of the aiss^
Therefore the code
unloi
granted In the scar
on the 23 Nov lo
cop"
arrived £ro« Paris via train ar.i
arted finally at about
(23 Nov)
Copp had requested froa ne to also
>to this operation due to the utaost
ir UMS ^^^^^^^
rtransaltted ^[JJ|^J||^^K jmi < f i |i
^cd and departed toTV^B^I^Hi^BB
_The overflight r_lghts had beei^^^
atl^^^HH
PHASE III - Loading
^^^^
Although Richard Copp, ^^P^H^^| had to ae that the
loading waso^nned to^^S^^ihoursbut would be speeded up to
2 hours .^WB^uhirh had first arrived,
piece out of 19 pieces in 4 hours. The
concerned parties were concerned that
long at possibly 24 hours. Therefor
traffic rights had not been granted
that now the load had to be transport
confiraed ay Initial suspicions and It
several things had to be changed.
before that the traffic rights in
crew told me that in TLV evcrvonc kr
iNCLASSIFIED
-Lo
rned dovn and that the real dc$t wa
DO
166
J./,: 85
UNCLASSIFIED
------l w*s givtn Che contact of Mr . A. 0:hvlanD.r In TLV by Mr .Copp and^^'
tV .'■ -.-t«lk«d to Schvimmer $««r*l tla«s on tht phon«. ^^^
S!^**^
1 V
itold-hia that we ccuM not fly to THR "^''^^^^^^r
'" and that we i.erefore ^-^d to unlo«<i^MJ^»«in|^
^^^JHHBf Ht crj"«V7«ver»l Cl»«» to convince ac »na-Tven
o:i?fe^^«lnt • different registration on the «lrcr«ft .nd
do some kind of formation flying Into THR. Keeping In alnd that
,hone conversation, to Israel .Ight be listened to. I told
we were a oonwl Airline and wanted to stay In business
tine to coae and chat rhmly vav to do It was the correc
us to do It. Thereforel|^Mri'STTmIW7eT-iiaTtrr—-frc.lw
■dditlon to that 1 .xplaineffffTS that we needed traffic rigr-,,
,rn?*iliiBwhich we had applied fo^|ntatlvely the aooent
., ,.^..'A .-mint .11. t;'.t.. ftt^ *?' 1 (
TTv all the tlaean^/rlfled all
the.. In f«<:tHH|was In Schwimmers
•u>*te that we needed 30 000 USD In
"istinatlon because we had not planned
T^ enough cash with us. Also we did
vthlng was paid in THR. SchwiMer came
enghty discussions because it was Sunday
could not gst Bore money.
rr.ucr.
home and w* r.««oti
order to go to th
on It and thereto
not trust them ih
up with 8000 USD
in tne meantime
PHASi
performed
^
.1«^
viHCUSSmtO
^ DPUIPM/
REVIEWEB^FOR Pt|
'^ «. -a •« ^t«
Accoro'.np -.0 t.». a«v iJ-' «'>•»« between Schwia
had bten unloaceo assir and departed
^on 5« .-.-ay tne 24 Nov.
^^^*id th.. flight and took .11 .xtr. crew back except
lenghty loading .nd -. . .ct.d ""^^'J* ^',f ^»,i,hts for
m the •••"SiSt^Sfiar'/v'Tfl^d^^^* could go
ov.rfUfht^Hi*'^''T !°^ i^^^
wlthiiii|as"s^oTr-it*«« lo.ded. /|^^^^„, agreement
HovelTT th*^«st moM- '^^ifiggiJKl^^ini on to TH
that the aicmft sbou. t'^^fV^PlW' ^K »,,<, to
This required ^ditiW* : -nds by «* jj^yaKli f or landins
defuelied in TT.V becaus it would h»<
MSiflbnd had to refwe ."^bis mis
^^^^^^^ -r 'sit---' ■» -sney but
"." .• - . .. r--*"^ ^.no:her 2
i ,..ii_... - jog,.-t. yith the
f 3<^
B FOK K|L£AS£
it){
>-•««
of KErtO 30U85
UNCLASSIFIED
n cht 24 N
^<
cl.Uy ch. «llui-ry i„ TLV h*d aoc only not jlv.o hi. ,ny
"fov.d that th« .Ircrifc vat in TLV.
_cher«fort did not want to rtltasc th« aircraft
locu»«nts w«rt productdandjh.refor. th. load aUo ^ «,
insp.ct.d. II MKB H'
which was accepted although It had no ttaop of" th.
point and finally he could talk his way out of this
. Finally he therefore left «t ^BMB direct ion
as planned. _ ^^^^^^^
HS^T^Tr. nothing was prepared for overflight ^^^B and s, h.,H
onTH<°,"'\'"/'=' '''°"«''- ''"'• '^'^ r.pTT^^nslste
on a diplomatic clearance nuaber, he oade one up which was
not accepted after longnegotlatlon^n^hen he filibustered
^^^ud^s. positions and esclnates that he'toldl — '"
viousljr in radio contact.
'ith whc
obv
Uowtvar, ra<
for arguaent* and
AC ch« TUK bordar
not have to say thi
because fUdar treat
Finally h« landed
Ms off- positions which gave additional re
I lays.
received without any problems but he did
■d coda "I aa coming for Mustafa"
■ Uy.
[on the 25 Nov(monday)
PHASE V - UnloadlnJ
After landing in THR cht aircraft. J>ad to remain on the runway
for about 10 aln until a "follow ■•" came and directed them to
th« parking area which was on the military side.
Thalandlng had b«en done on njnway 29 r and the aircraft was
directed Co the south of this runway c-to :h« t>-e rorth/vesc
part of th* southern military apron. At this location the
•4rer^U^4 parked aiao duiing vui laac fl
«BAfl^ft It Is a special area which is
to th« outsld* so that people outside the
3<^
^^ rt f^ uniO»».*f.^ A«v«4 aiiu wiiQ woia nx
^/^j3 '■^^* flight and were surprised that
' 30 mln afcar arrival a civilian wic
UNCLASSift'EDl
was first contacted by an office
badlng later and who told him th
h
back arrived at the aircraft ilU askc
"Vhat arc the nationalities of the
where do you come from ?"
he talked to4|M||^ telling J^a^hat
'-'oil 2 »ar« 2J}
- 5 -
168
p«|« 5 KEHO 301185
UNCLASSIFIED
he
-S'-^ttLl-anyont Including the BlUtiry whtr« th« »irer«ft rttlly
^*i<*w>CM«^^oB . Ht chin Bcncioncd chat th«y wen txpcctlni 4 Bort
flfftt«|-frQB TL\^H«woul^_mn to st« the •«•« erev then due to
Vhcn^^^H|was ••king foe aoney or airanieacot*
of fuel, perklni etc. he (.old his not to worry tnd that everything
would be taken care of.
'Itor then etarted to direct the unloading, one ■llicary
rclvllian with subnachlne gun.
wa« tent t^ the officer* Headquarters where they vert
lin by the civilian to keep their south thut about this
.talk to anyone about their aittion.
then tpld hi* t>ut ovr crew did not want to pas*
through pa**port and cu«to«« eoocrol because' during TSe Tjsc flit
it had takan several hour* and _chey wanted to avoid that this
time as they expected_.TQuick"unloadint an3" then had to leave again.
Therefore the civllian'cook the« in a ear chrough back roads
off the airport and was noc checked or stopped at the gate although
even ailitary had to prefrtrt their id - cards ac chat gate.
The trip co the HotcI^Apk one hour and finally they arrived
at the foraer Sher jcplrtifotel. (Different nana now, could obt
reaesber)
All rooas were occ
cogecher. After be
curprlse of the cr
unloaded and that
This was 6 hours a
remained at Che ai
really took place
tiae in the office
soae else.)
However, after this alerc ic cook 2 hours undl the car finally
arrived. In the aeanclac the civilian had apologized several
tiaes and the crcv was offered coffee and cakes.
After arrival at the airport through th^jbackdoor ^_^
required a peralt nuaber for overf ligh^fHHj^^ in order
avoid the problea he had coalng In. He refused to leava without.
Therefore he and the civilian went to the Tower froa where chty
tried to^^^^H^^^^HVobtaln this Dumber. After about 2
nd therefore they had to take a suite '
the hotel for about 2 hours to the
got a phone call that the aircraft was
uld be picked up In a fei^dnutes. f^P^
c aircraft had landed . AjmimiudTH-^'A
for soae tlae to see that the unloading
t it was done correctly. Then the
and the trip to the Hotel had taken
^
3 3^
yNCLASSlFe
.... l^A-h
hours of cryiog^^^^Kcold chea chat
but they could not get a nuaber. Alsof
Air I>«fente of Iran was inforaed and
which ha finally accepted.
When the crew was taken over to the aii
Che aircraft had been cowed co Che civi
and that it was being fuelled by civlj
When^mPf^ksked for full tank* (oi
after all those problems which I wa)
had called^Qjvla Telcfone froa the
to take th^alrcraft directly backl ^^
the civilian who had received him was'-'-very disappottit*d«be cause
he realizedthat so much fuel was not needed to go back to TLV .
However flBflHH|c old hia that he nttotd the extra for security.
J /I
0
169
p«|t 6 of KXXO 301 18S
4iNCLASSlf;cD
- Return flight
on th« 23 Nov, after U:35 hours
Tht aircraft took of at |
on tht (round In THA. ^^^^^*
Th« aircraft wai directed by radar off the airways a little sore
than normally, close to the Russian border.
was given a special exit tine which he had to aeet
omply with the Iranian Air Defense,
ching Tabti« th* aircraft «*«orde«^down fron FL 350
1. 280, shortly before reachingJ^^^^H^H border again up
to FL 350. (reason unknown) . ^i^f^t*^^
No transponderwa^ije^llWh^Iranlanairspacj^^X^T^
After •rrival |H[H|||||^m^^|BH||K^Sstold by radar
tiac he was ac^pted but -lit^t In futuretor further flights, the
ok of the clvilalr was noC, enough but that he had to get also the
ok .of the Ministry of foe«ifn affairs and that otherwise the
aircraft would be turned back. --jA^§r^
Based on all this IqGfgtlon. 1 ordered HHIPvi^ radjo to
dlreccly^^MHHlHB^^^^Hi^^^HBH) which
had planned Inlti
GENERAL CONCLUSIONS
■n^
,v>^^«''
0
The Mission was poorly planned and directed by our contract
pactnars In a aaat«url«lL«^L^_^
I. tf^^^n>JM4JkBKK «IWlk«t for about • weak with
2.
Copp was sitting In^HJ^ although<MI
and he a* our contract partner cov^7
goini 00 in TLV.
In TLV the aircraft wa* on cht alllt
high ranking ailitary' personnel who
this type of work. (The lowest rankla
In addition they did not work such a
coffc brakes.
A certain Mr .A. Schwiamer which was^;^.i;— _
the representative in TLV of Copp,'v'w*ir'«ry
military, sometimes to a point where he was
he did not understand the special aviation p
not have things urd^ control. I.E. He sriou
the I 1 1 I I I I^BBBUB change the registr
not flown to
'xaJOJ Copp as
push)'t,vttlj,th*
Insulting, but
rotltas ar.c i'.i
sl>- proposed cc
n c: tr.e
170
Pag* 7 of
MEMO 301183
UNCLASSIFIED
t- ■^^^^^'^^^''•f' '"d to ■fl* thirr*sp*cclvc paper* " lo 2 hours"
K*'- This was Curntd down by^B||||[||^and also by aysalf when
,-i^SchwiBm«r Mntlontd ic o^th^phon* du* to ch* b«£or* ■•ntloned
' n«. ~«>^-r
ch« caih aoncy which Copp had proai*«d was ooc available
aad Schwlnmtr apparandy did not kjiow abouc thl* raqulrtacnc.
outing changts. dastlnaclon chang**. Involved traffic
t* were don* too lac* and th* er«w gr*w aor* and bore
•cure as th*y ar* not usad to this cyp* of aakcshlfcr
tllne dlr*ctlon and control.
The Blsslon was still p*rfor«*d successfully because of the
initlaclv* ch* cr*w had dlsplaysd and bacaus* they ar* used
also under advcrs* clrc««stances to coaplcte the mission
before probleas will b<: discussed. How*v*r, this Is not the
way It can b* don* r*p«»Mdl.y 'b*cause th* good will will be
worn ouc.
PROPQiM.
As Aviation la • v
*xp«rl«DC* froa al
Information la so
•aploy**s hav* to
ipl*x busin*ts which r*qulr*s a- lot of
road and also bacausa the faad back
or Ch* oparadon, ch* directly Involved
of Ch* d*cl*loa aaking' and planning
as aarly a* during ch* concracclng scag*.
Had It not b«*n a special flight, I would hav* d*Iay*d for about
2 days afcar I had leamad about ch* chang* of D*stination in
order Co hav* *oough ciaa for corr*cc planning and ch* aquisltion
of th* n*c*ssary traffic rights.
Th* llctl* radar concroll* do«s not know pollclcal daclslons and wil
noc *v*n b* Inforaad by his superiors. We experienced that tiae and
again. Therefor* all those things hav* to b«
way so thac ch* controll*r slaply has a
nuabar Ilk* h* hat for *v*ry otb*r alrcra
will look cocally normal for hla.
In othar words: Thos* flights can b* p*r
by only with th* proper planning.
In ordar to have propar planning, th*
happans to b* aysslf, should b* h*atd
aaking cooaltaaocs to chlrd parcl*s a
planning procass.
nc*d In a normal
clearance
this flight
any problec
nuA/ 0-^33
if'ji^^' ^^cussffki)
^ o ^
/4^
<,<r
171
^~**f s of tton 301 iss
J^rafor* •uigttt th«c durlB» tht pr«p«r«tlon proctst 1 should
tad to tho ■••tlni of th« doportBonH which art Involvad
.^ ._ ••eurlty and that tha
hava to b« dona In a clandaatlna way. Howavar. It cannot
rat chao It waa during this last mission and It could
,«a parformod totally clandastloa, had tha abova propostd
"Mating takan placa In advanea. ^ .^ism- »— -
-In aadditloo to eh*t. ay prasanco *!lliak2|i^,?lgiP&*f *^ ^
provtda tha eoncarnad of f Icara who TifHiHW tho dtWarant
dapartaants with usaful faajback Information so that for futura
planning som things can ba- nilad out right away without avan
going into datall wharaas_fltT>ars can ba accaptad right away
without chacklng datalls.
In addition to that!
should ba part of al
I aa not awara of iS
would ba aaslar to
casiar to plan tha
alrplanas hava to bl
jlngla missions or tasks to ba parfohiad
Itf whlcl> I «• •*»" •*i*'«' *»•' which
111. Knowing tha all-ovar stratagy it
lartaln aisslons and it would avan ba
(udgat which daflnas whathar naw
Ihasad/laasad or othars hava to ba sold.
In short: I would sHd'Ca If I could b. glvan «»" '••P'"*^^'^''^
by baini aora part i^D taaa as far aa tha planning of tha
ivaltioS Mpacts arHl.mad. I think it is a wasta of .xp.rl.nc.
and ii^oraation wh.Hi. noc aada part of tha P '"i"* P";;' "
I also Ilka to aaka sura that I aa not on a "ago trip . but that
I hava tha succaas of our coapany In alnd which last not laast
is also tha succosa of this country.
C/^/\/36l^
172
UNCtASSI^ED
2S November 1985
SUBJECT: NSC Requirement for Covert Airlift
At the request of the NSC on 24 November,!
^^^^^^^^fproprietary Boeing 707 transported sensitive cargo fron
Tel Aviv to Iran. This was a fast breaking requirement for a
controlled non-U. S. registered commercial airlift, w* are pl<>ased
^^^^^^H^^lproprietary was able to successfully handle this
sensitive and dangerous airlift which involved a routing from
Tel to^^^^^^Pover^^^^^Hinto The
unloading in Teheran and should depart this morning. Hore flights
are expected this week.
a^:5^. 2 9 Nov SS
Distribution:
Orig -
2 -^^V:hronoi
-^>
ijnder provi'.;:ns of E.0. 12356
hy 2. Reger, Nr.ticnal Security Council
nm]^:^^^
M
CL «-y|
DKCL7 OATT?
HRV '^W 4-H2
173
UNCLASSIFIED
'" I!
KQIORANSUM 3/1 1
;!•..: ILV/TM fit
Display of cospany
ielal concaec vlth Copp and also latar In dlacustloa*
lanar, I acrasaad th« financial points and gavt 'thca
silon that I vas aalnly Intarastad in the aonty.
«nd SchwiBBcr
told hla that cha
that bafora wa discuss
first flight whan I had
callad aa on Tuasday in ay offlca
■ooay had not arrlvad yat as promisa
it furthar, wa oaadad our aonay
Ha than said that ha was notju^eontraet partnar, but Copp>
callad again trov^^f I told hla that ha should
to aast with aa and to discuss his payaant. Ha was
had not coaa in yat and that ha
Whan Co
vary asazad that tha aona
could not coaa baca<
Ha than proaisad to
. .... as foon as poaaibla
Alltogathar thay aua^
daaling with a aarc
a Job to aaka aonay.,
Tha saaa iaprassioa
by Capt
TM-^T^ way ^«^
final ok by aysa
iyad to go back
ra-tha aonay wou
to''sava 225 OOOUSO"
transfarrad
had tha iaprasslon that thay wtra
iXllna and that wa wara Just doing
da in TLV in discussion with Schwioaar
tha aain points wara how to gat
to handla things tha co^rcial
iWi^Mr that ha would only fly aftar
lould coaa aftar X had agraad with
Schwiaoar about cha aooay and tha cash which ha had to gat.
__^ [wa had tha axcusas of having a urgant raliaf
flight/landing gaar preblaas and aftar tha airplanas ratumad
fro* tha crips avaryching wane back co noraal and no quaations
_tiW^wara askad.
under provisions oi E 0 12356 Tha craws did not talk to anyona about any coapany aattars
by K Johnson. National Security Council in TLV or THX and all concarnad ahould h^va ]BB^||^ iaprasslon
that a businass «as conductad in a profass
Partially Dticiassilied/Releascd on_
^jm iiNCiASsm
174
Hadialli: PeElassified;/Releas?d on^i^Y^^^
Cndir provisions of E,0. 12356
By B. Reger, National Security Council
.SUBJECT t_MSC-REQUEST
REF:'^
1. ACTION REQUESTED:
FOLLOWIMC.__ , • ■ . ■
ALSO'CONVOKED. MMBllQUIT^iPSET
RECEIVED. FACT F I RST. FLIGHT. CAME Dl
NOT REQUEST CLEARANCE BEFOREHAND AN
PLANE'S CARGO. ■MTOLDM^BilT
TTrrrrwrn-CffiR lER STATED MEDICAL S
GROUND CONTROLLERS -HE WAS^CARRYIHC
• 3.iHBcARRIED THE CAN ON THIS
AND DEpTRtmENT (DEMARCHE WILL' NOT B
CHANNEL). ■■■^^m
k. BOTTOM LINE IS THATflB^TIL ,
nPVFinpgP A LITTLE CYNICISM ABOITT OU
MATTER .JIPBiiiiACREED -THAT- FURTHER
SUBSEQUENT ._ _^
PLANES FOLLOW NORMAL PROCEDURE
AND THAT THEY 00 NOT SHUTTLE FRO
PLANES MUST NOT COME DIRECTLY FROl
MD PICl UP OTHER ^amiriM. EVEN B
AT ALL
FLASH RESPONSE SOONEST TO REF AND
URS.. AMBASSADOR WAS '
LT I PLi- FLIGHT PLANS.
.romSHBBand DID' /r'
XtlHG-STORIES -ABOUtl.': ■
INDUSTRY SPARE PARTS,
AND THE PILOT TOLD .
EQUIPMENT.^
IT. TO I NVOLVE ' AMBASSADOR
ED OTHER THAN IN THIS
TO ASSIST BUT HAS
_Ua ION WtTH. THEM ON THE,
FLIGHTS COULD PROCEED"
kLSO INSISTS THAT
7ERFI
AS NOTE!
THEY SHOU
ILIZE
/\lRLIMF f^P.
F U^^LEARANCE. 'BRJ
SHoffWufWrtST ^^O
5. ANOTH
AIRCRAFT.
MATTER REQUIRING CLARIFICATION IS THE QUESTION;
'HAS IMPRESSION FROM PAPERS F HEP BY CARRIER T"'
I UTILIZED AND SHUTTLE FROrHMBH THAT IS
MPRESSION FROM EARLIER TRAFFIC. TLS CLARIFY.
6. THE SITUATION NOTED PARA 2 REF, I.E. -SECOND FLIGHT
THIS MORNING DID NOT EVENTUATE. WE NEED. HOWEVER, TO TRY
EXPLAIN AWAY THE MULTIPLE FILED FLIGHT PLANS., IS IT PROB,
THEY RFPRESENT PLANNING PRIOR TO THE RESTRICTIONS PLACED
FLIGHTS ByBHI if SO. WAS THERE A BREAKDOWN IN COMMUNI
CHARTER CARRiTr DID NOT GET THE MESSAGET THIS IS A POS
explanationBHpresenteo to
^^^^^NJ^VENT^^R^OIH^^JAV^^RY
^^^^^^B^^^T^^HA^t^EM^^TOCIRCUMVENT THE
^EITHER CONSCIOUSLY OR THROUGH POOR COORDINATION) RUN^llI
LEAK AND BAD PUBLICITY. HAAMF^Jb MORE TO U.S. THAlAHHp
7C
175
■7— ^"f :^'-^
UNCLASSIFIED
-*-^ T^ru^.^,^ J1-,
3 3^ ;j4i-
Partiaiiu Oer.lassilied/Released on ^JJ^'^BS
unher provisions ol E 0' 1?356
by K Johnson. National Security Council
Cii^ ^krV9
i-'-'t ■.'•>• >^ -;)*. ■'ij.
i.-^jii-c, >[^,J^^
176
/^^oo^
<2—
aamifiB
:^■'^)
-Partially Dectosilied/Released nn ZWj»1->>-<88
undef pcovisions ol E 0 12356
by K Johnson National Security Council
3f3c :>/v3
Cl'A/ 3545
177
/ Ot,c H
707 REVEWUE VOUCHERS k RIGHT TIME REPORTS
MEMO
-SUBJECT
FROM
Accache? please find copies of fllghc«tlae reports covering
daces of Interest for both 707 's Kffl&venue vouchers showing
paynenc for the flights, plus $8.0MBw cash given to captain.
As. I told you yesterday, 30 Mov
lading. In fact on landlni
vrlte on a plain piece of paper
I believe he listed oil drUllng
Is what we were originally told
If I can be of further help pie
paperwork Is the extent of Info
flight.
Is and was no bill of
Che Captain had to hand
t aanlfest to be released,
nt as the cargo as this
d was.
■e know . however this
In ay office re: this
Parlaiiv ne^.iass.t,ed/Beleased on_^ _
unfe- provisions ol E 0 12356
by K Johnson, National Secunty Counca
\Jf\W>r
*%/i
m
pr- rsnnr.'ijy;
0 \ - I?t2.
178
UNEIASSIFIED
/Jo Of^Tc-
■"a'-.-.iiv neciassified/Released mjMS^^^S
under provisiooi of E 0 i2356
bv h Johnsofi, Nalioriiil Setur.ty Council
rwA/ D5<^(p
o-^ C J
179
OF PROCEEDINGS
UNCLASSIRB)
UNITED STATES SENATE
HSIS -^2- /87
SELECT COMMITTEE ON
SECRET MILITARY ASSISTANCE TO
IRAN AND THE NICARAGUA OPPOSITION
Deposiclou of FRANCISCO J. ALVAREZ
WashingCon, D.C.
28 May 1987
V/v^_
oopr No-
^^r^ V
Partially Declassified/Released on /"V'^^
under provisions of E.O. 12356
by N. Menan, National Security Council
xom
Ace-Federal Reporters, Inc.
Sitnotype Ftporten
444 North Capitol S«peet
VN&shington, D.C. 20001
(202) 347-3700
Nationwide Coverage
awmm
180
Partially Declassified/ Released
under pro
by N._Menan,
.CI-flDCML alraHTMS. INC
IMA^FIED ' i
UNITED STATES SENATE
SELECT COMMITTEE ON
SECRET MILITARY ASSISTANCE TO
IRAN AND THE NICARAGUA OPPOSITION
i
DEPOSITION OF FRANCISCO J. ALVAREZ j
Washington, D.C. ,
Thursday, May 28, 1987 |
Deposition of FRANCISCO J. ALVAREZ, called for !
examination by the Senate Select Committee on Secret Military!
Assistance to Iran and the Nicaraguan Opposition, in Room
902, Hart Senate Office Building, 9:15 a.m., before
LOUIS P. WAIBEL, a Notary Public within and for the District
of Columbia, when were present:
JOHN SAXON, Esq.
Associate Counsel
United States Senate
Select Connnittee on Secret Military
Assistance to Iran emd the Nicaraguan
Resistance
Room 901
Hatrt Senate Office Building,
Washington, D.C. 20510
On behalf of the Committee
ROBERT L. KREUZER, Esq.
House Select Committee
isions of E.G. 12356 ROBERT J. WINCHESTER, Esq.
[national Security Coun(3lpecial Assistant to the Secretary of the Army
for Legislative Affairs
The Pentagon
wmssm
181
mmmi
TABLE OF CONTENTS
WITNESS
PAGE
Francisco J. Alvarez
By Mr. Scucon and
By Mr. Posey
EJOilBITS
'Ci-rcKUL KKtrns. inc
mmm\)
182
Whereupon,
FRANCISCO J. ALVAREZ
was called as a witness and, having been first duly sworn,
was examined and testified as follows:
EXAMINATION
EY MR. SAXON:
If you would, sir, state your name for the record.
.Framcisco Jose Alvarez.
And what is your current rank?
Major, United States Army.
What is your current position?
I an a student at the Command and General Staff
Q
A
Q
A
Q
A
College.
Q
A
Q
A
And that's at Fort Leavenworth, Kansas?
Fort Leavenworth, Kansas.
And when you graduate, where will you go?
I*m being assigned down to United States Army
South in Panama.
Q Prior to CiG School, where were you?
A I was in the Office of Defense Cooperation,
Saur Jose, Costa Rica.
IMUSSIFIED
CC-rtKIUL •CMMTUS. INC
183
w&Msm
Q What were the dates of that assignment?
A I reported on 15 September 1983 and departed on
15 July 1986.
Q And in your position. Major, in Costa Rica, to
whom did you report?
A To LTCOL John Taylor.
Q If you would, I'd like to ask you some questions
about what we discussed previously in our interview with
you regarding private supply operations to aid the contras
in Costa Rica, any refueling stops which you are aware of
that took place.
What can you tell us about the refueling of
airplanes?
A 1 know of three incidents where C7 Caribous came
into the International Airport in San Jose for refueling.
I personally was involved in the actual refueling and the
coordination of it down at the airport on two of the three.
The original one was handled by the OPS NCO, Sergeant First
Class Sanchez, who also had been on the other two.
Q When you were told that these planes were to
be coming in, how did you get that tasking? Who told you?
How did it come through the chain, et cetera?
UN61ASSIFIED
rc-fiacxM. MNtTcn. inc
184
^mmii
A It came to me at ray level from LTCOL Taylor.
Q And from whom would you get the information that
a plane was coming in that needed to be refueled?
A It would have had to have been a combination.
He would have possibly gotten the particulars on it from the
Q And that would
^^^^^^^^^^^^H yes , sir; however.
Colonel Taylor and the way he operated, I have got to assume
it was also being reinforced or directed by the Ambassador
at the time.
Q That would be Lewis Tambs?
A Yes, sir.
Q When you assisted on those three occasions or that
yon were aware of those three refueling flights, and you
assisted on two of them, are you able to put any time periods
on when those took place?
A The first one I remember, which was the one I
did not physically assist on, but I am informed of, I am
not really sure if it was late '85, early '86 time frame.
The other ones were in the spring of '86.
Q Was there a flight which came in that had actually
UN^S^dED
:C-f(KUU. •CKHITtiS. INC
185
iimmEs
not dropped its load at the time?
A Yes, sir. That was the very first one that I
just mentioned.
Q Okay. The other two came in for refueling, and
they had already made their air drop?
A They were empty when they came in, yes, sir.
Q Tell us about the flight — I believe it was a
Caribou 7 ~ which had not dropped its load yet.
A ' Yes, sir. It had come in in the early hours of
the morning, right predawn time frame. There were
problems in terms of clearing, because when they cleared it
with the Costa Rican officials at the airport, to be able
to get the plame refueled emd get it back out, it was under
the assumption the plane was empty. In fact, it was reported
to me by Sergeant Sanchez that the plane was full of what
appeared to be mail bags. Tbe sane bags that U.S. mail is
carried in, which were stenciled with the letters "UNO."
The plane, after a quite of, you know, minor
hassle and problems in getting out, because it was full,
departed and developed some type of trouble '-'^ engine or
what, I don't know •<— but it did, in fact, return a short
while later. At that point, it took the efforts of Colonel
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Taylor, who was very good friends with the Commander of the
Costa Rican Air Section, who is dual-hatted in the Costa
Rican Civil Aviation, to be able to work together to get
that plane out at that point.
Q And did that plane ultimately get out?
A It ultimately did depart, yes, sir.
Q Do you have any knowledge of whether it made its
A No, sir. I do not know, from that point.
Q Do you have any knowledge of what was in those
bags which appeared to be mail bags?
drop;
A
Q
A
Q
plane?
A
Q
No, sir. I could not say what type of aid it was.
You didn't see them yourself; is that correct?
No, sir, I did not.
Sergeant Sanchez saw actually what went on the
He was the one that reported it to me; yes, sir.
And what do you normally assume the letters UNO
stand for, or what would that represent?
A It would have been the acronym for the United
Nicaraguan Opposition.
Q What did you understamd or assume about these
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flights? I believe you told us yesterday, in the interview,
that you assumed that these were flying cargo!
Is that what you told us?
A Yes, sir.
Q What does that mean?
A
We assumed that they were flying cargo, assistance
of one form or another, to the contras.
Q Either on behalf of the CIA or at the request
or under the contract —
A At least coordinated and directed by. I didn't
know the inner workings.
Q Now in terms of things that you, and I guess.
Sergeant Samches, in an assisting role, would actually do
for these planes, what would that consist of? I believe
were
there /about three things described to us yesterday.
A Yes, sir.
The main things we would do is — not necessarily
in order — but we would coordinate for the customs
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clearance, basically. Every plane coming into Costa Rica
has got to go through customs when it first enters, the
same as here, so that type of thing.
Now we coordinated with, based upon the
relations we had built with the people in the airport,
because the planes did not have the normal dociunentation that
planes would carry, to include manifests, flight loads and
all that type of stuff. t
1
.And secondly, it would be the clearing, basically,;
of the flight plan.
Q This would be with the tower?
A Yes, sir, with the airport tower. Now that we
would actually begin before letting them know this plane
was coming in. I believe yesterday I indicated in
clarification that if it had what I would have called a
bogus flight plan to come into the country, that would have
been where it originated, but then something to be able to
permit it to get out. And then the actual coordination with
the Costa Rican refinery people who handled the fuel
distribution at the airport for the actual refueling of the
plane .
Q And in terms of the customs clearance process.
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ver tell you or Colonel Taylor how you
did
should try to see to it that these planes were not searched
] by Costa Rican customs?
^ ^^^^^^^^^^^^Hdidn' t The i
received with Colonel Taylor — and instructions is perhaps
the wrong word, because we, more or less, would discuss how
was the best way to do this. I got the indication that he
had been at least requested to keep people away, if possible.'
Q Did you ever have occasion to talk to any of the
crew members of these planes?
A No, sir. On occasion, yes, but as far as
actually talking, no. The would come in, and they were
busy refueling. We coordinated things and, you know, there's
that concept of "need to know," basically, and I just felt
I didn'-t have a lot more "need to know" at that time.
Q So you basically would make small talk with them?
A If that.
Q And did you ever see any crew members in a
recurring role, people who came back a second or third time?
A I can't say. I don't know.
Q Major, what do you understand to have been the
mission of these planes? What do you believe, based on the
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tilings you were either told or the inferences you drew, that
they were actually doing?
A Dropping some kinds of supplies for the rebels,
operating in the southern part of Nicaragua.
Q And what kinds of supplies do you think they were
dropping, or did you know?
A Those particular planes I am talking a bout at
this time, sir, I do not know.
Q Who told you anything that would permit you to
draw tiiat inference about supply drops in Southern Nicaragua?
A Well, sir, it was partly deduced just from the
nature of the missions and what we were doing. Otherwise, it
been
could have completely, you know, /handled by just routine
types o f things.
And then, secondly, was again. Colonel Taylor and
I talking, based on what we had received from|
that that's what these planes were doing.
Q Is it fair to say you were reasonably safe in
assuming these drops were intended for the contras?
A Yes, sir.
THE WITNESS: Can we go off the record for one
second? I just want to ask a question.
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MR. SAXON: Sure,
(Discussion off the record.)
MR. SAXON: Let's go back on the record.
BY MR. SAXON:
Q Major, did you ever ask Colonel Taylor if what
you were doing in assisting these flights in refueling was
okay or sanctioned or approved or whatever? ,
A Sir, the environment, the atmosphere we were '
operating under, at the time, at this particular point, aid, ';
generically speaking, had been approved, the limited $27
million at first and later on.
Ambassador Tambs had repeatedly stated to anyone
within hearing distance that his purpose or main mission in
Costa Rica was to open up the second front, and he did it in
quite an open fashion. Not just in secret conversation or
whatever. Therefore, I felt no need to question the
legitimacy of what we were doing.
Q Okay. Let me make sure then I understand what
you aure telling us.
You are saying that Ambassador Taunbs said — by
"publicly," I don't mean to the general public, but he said
openly to staff meetings or country team meetings or
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whatever on more than one occasion, his purpose in being
there was to open up the southern front; is that correct?
A Absolutely, sir.
Q Would it have been at staff meetings, country team
meetings, political-military meetings?
A Sir, it was all of the above. Conversations with
him in hallways. He stated that quite often, quite
frequently. I
Q And so there's no mistaking that, in your view? I
A No, sir.
MR. WINCHESTER: Can we go off?
MR. SAXON: Sure.
(Discussion off th.e record.)
MR. SAXON: Back on.
BY MR. SAXON:
Q Major, you, I think, mentioned a second front a
moment ago, and I may have thought you said "southern front."
Is this more or less the same thing?
A They are the same situation, sir.
Q Okay. Did Ambassador Tanbs, in making these
statements, ever indicate who sent him there with that
mission or from whom he got such guidance?
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A No, sir, he never stated directly.
Q Let me ask you about the general guidance or
^nst^iction^r approval that you may have gotten from the
^^^^Hm— Taylor — terms of your
assisting these refueling operations.
What, did^^^^^^Hever say or
do to indicate that this was sanctioned?
A I'm not sure I understand your question, sir.
He was the one who provided the information to Colonel
Taylor as to when they were arriving, when we could expect
them, and that type of stuff. Obviously, he was the one who
knew it, indicating they were the ones who had coordinated
o^^east it was relayed to me through Colonel Taylor that
^^^^^■in talking to Taylor, had indicated that to him.
Q And Colonel Taylor more or less took that as a
tasking or an assignment?
A I would not believe so, knowing Colonel Taylor.
I'm sure, as a matter of fact, just knowing Colonel Taylor,
that before he would do anything like that, he was going to
get the direction to do it from the Ambassador. I don't
believe Colonel Taylor would have done that on his own.
Q So you assume that anything he did or instructed
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15
el
you to do in the resupply operations, the refueling operations,
he would have gotten approval, either expressly or
implicitly, from Ambassador Tambs?
A Oh, absolutely.
Q What, if anything, did you tell Sergeant Sanchez
about these missions and what it was you were doing or why?
A Sir, nothing specifically. First of all, even
though the rank structure is different, in a very small office
in Costa Rica, Sergeemt Sanchez also reported directly to
Colonel Taylor. He did not report through roe, so he would
get this information directly from Colonel Taylor, also on
everything else. So Sergeant Sanchez and I would have
talked eibout them basically in terms of what was happening
and what we were doing, and, you know, here we are, going
back out to the airport again, that type of thing, but not
in a direct type of thing.
Q Now, how did you understand that the fuel was
paid for?
A I saw them paying in American dollars. It was
not a matter of understanding,
would
Q And what At normally have cost to refuel a
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16
Caribou?
A
of $2000.
Q
A
Q
A
If I remember correctly, sir, it was in the realm
And you're saying they would pay cash?
They paid cash. I saw that.
How did that work?
The guy reached into his pocket, pulled out a wad
of bills and started counting them off after we calculated
what the oonversion was.
Q And did you ever hear Ambassador Tambs make other
statements along the lines of generally being supportive to
the contra effort?
A Oh, absolutely, sir.
Q And what would be the circumstances under which
he would have made such statements?
A Any time he had a public opportunity to talk.
By "public," again I'm referring, you know, in a group,
not necessarily out in front of the general public.
He was quite a strong supporter of the contra
movement, no holds barred and no equivocation in his manner.
Q Did he ewer make any of those comments in the
presence of other government officials at either an
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17 I
equivalent or higher level than his own?
A There were meetings held where personnel from
Washington had gone, sir. You know, discussions in that
time, in some instances, just involved in a very general way
without any real specifics about the whole rebel movement.
I tiiink anybody who knew him, particularly above him or
coequal, would have been quite sure of Ambassador Tcuobs'
sentiments .
Q Was there anyone ever there in the command ranks
at South Com, when he made such statements?
A I really cannot remember. I remember one meeting
that this was not the ejcact topic, that General Galvin may
have been there, but I just am not real sure. I can't place
it definitely.
MR. SAXON: Let me say, for the record, that when
we make reference to the fact that you told us something
yesterday, I should have said from the outset that
you
Mr. Kreuzer and I interviewed /Yesterday morning at the
Pentagon in the conference room of the Army General Counsel,
and so that is the interview to which I make reference.
BY MR. SAXON:
Q I believe you told us yesterday about seeing
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18
fluctuations from tjjne to time in the number of people working
What can you tell us about that?
A Yes, sir. When I first arrived in '83 and maybe
in the very early part of '84, a certain amount of people
in the '84 time frame. That number went way down, then m
early '85, I believe it was, it started climbing back up
again, until by the time 1 left, it had just sort of gone
up and down.
Q Was that a particular section that you have
reference to?
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Q And what would have been the triggering event
or the causal factor to make that number fluctuate?
A Thinking back on it, sir, I would have to say
approval of some form of assistance.
Q Assistance to whom?
A To the Nicaraguan opposition.
Q Major, we covered yesterday, in some detail, the
existence of an air strip that was constructed in Costa Rica,
which the committee staff understands to have been used for
resupply operations.
Tell us, if you would, first, more or less where
that air strip is located.
A Yes, sir. That air strip is in
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Q Do you have any judgment 'you could offer as to
wisdom of that location, if you wanted to keep it secret?
A 1 thought it was a dumb place to build it.
Q Why is that?
A Well, sir, two major reasons. One is the
Q Commercial flights?
A Yes, sir. And even from the air, it's not
improved enough to be a country's international airport, but
it's too improved to be a clandestine drug strip, and that
lent — you know, if you have any knowledge at all, you've
got to suspect someone is flying things in and out of there.
Q You're saying it was a bit conspicuous?
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A I felt it was: yes, sir.
Q How did you first learn of its existence?
A In the first manner I just mentioned. I was
going up, basically conducting a visit at the Training
Center that was over there, flying with a Costa Rican pilot
and a Costa Rican Air Section plane, who was quite fluent
in English. And we happened to fly over it. He looked down
and said, "Holy shit, what's that?" At which point I !
looked down and repeated what he said. He was going to
report that back when he returned to San Jose immediately .
I asked him just to hold off before reporting it and let me
just check a few things out. When I returned to the Embassy,
then I spoke with Colonel Taylor and got the run down.
Q And what did Colonel Taylor tell you?
A That that, in fact, was an Agency-built strip or
at least financed strip, being used to reserve or refuel any
planes that were going to be making drops.
EXAMINATION
BY MR. KREUZER:
Q At the point when you arrived with this Costa
Rican pilot at that strip, tell me, was that a flight where
he genuinely had just discovered the air field, or was that
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a flight that may have been a pretext on his part or on the
part of somebody in the Costa Rican government to take you
up and let you see hira just discover the air field?
A Sir, I can't answer. Let me just say, the route
we took was the most common one to get to the^^^^^^^^^^^l
He would not have had to fly out of his way to show it to me,
when I said, "i want to go up there." I was the one who
on the to go to thd^^^^^^^^^^^^^^l
Now whether he had seen that before or one of the other
pilots in the Air Section had seen it and were trying to
figure out and learn more about it, I don't know. However,
Costa Rica, at this time, was very big on identifying all
■anknown air strips in the country in an effort to close down
on drugs. So I suspect that if they had seen it, without
anybody having said anything else to them, they would have
reported it. And to the best of my knowledge. Civil Aviation
in Costa Rica at that time did not have any knowledge of it.
Does that answer your question?
Q That was a common route?
A Yes, sir.
Q So would it be fair to assume, possibly, that
that route had been flown many times before by Costa Rican
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pilots looking for —
A No, sir, because it is a corainon route to get up
to the^^^^^^^^^^Hwhere we were talking or, you know, the
coinmercial planes, as I indicated. But unless you are going
to that^^^^^^^^^^^^they just didn't fly up there too
often.
Q Would there be any occasion for the Costa Rican
Air Force to fly up to that^^^^^^^^^^^at
A • Very, very few, no, sir. The Air Section,
basically, yes, you're getting down to the base section, the
Costa Rican Air Section, basically operated an air taxi
service. That's aibout what it anounted to.
MR. KREUZER: Thank you.
EXAMINATION
BY MR. SAXON:
Q Major, I believe you said, when you returned from
flying over this air strip, you talked to Colonel Taylor
about it.
Did he indicate whether he had been briefed by
anyone about the air strip?
A Yes, sir. In his emswer, he indicated to me that
Ihad briefed him on the strip. Possibly even
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before the actual construction, in help^^^?, or in finding
someone to undertake the effort.
II Q Was it your understanding that in some way the
construction of the air strip was an Agency project?
A It was ray understanding, the Agency completely
footed the bill for the construction of that air strip.
Q Was there any individual whom you came to know
or understand would have been what we normally think of as
the general contractor for this construction?
A Again, sir, without any concrete proof, but just
on a lot of basically circumstantial type evidence, that it
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Q And how did you conclude, or what led you to draw
the inference he may have been involved in sort of a general
contracting role?
A There were two things. For one, he suddenly.
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25
even though he was- by Costa Rican standards, a wealthy man
second incident was where he had come in to the Embassy and
had gone somewhere else in the Embassy. Now I cannot say
for a fact where, but suddenly he showed upstairs in our
office, escorted. He had been down to see another
individual who he thought was selling a car, and he was
carrying just a regular paper bag with $20,000 in $20 bills
in it.
Q Is that U.S. dollars?
A Yes,, sir.
Q $20,000 cash?
A Yes, sir.
Q That he wanted to use to purchase a vehicle?
A Yes, sir.
Q As far as you know, did he purchase a car?
A Yes, sir, he did. He purchased a pickup truck.
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Q Was it a new or used truck?
A It was used. A 1982-83 pickup truck.
Q I hope he had a few dollars left over.
A I understand he had quite a few of them left over.
Q Did you ever discuss the air strip yourself with
A He discussed it with me. I didn't discuss it
with him.
Q . And, Major, how did that discussion come about?
A There was one individual who worked]
that I had a good working relationship with.
Q This would have been a man namec
A
A few days after this. Colonel Taylor was out of
town, and I ran into him in the hallway and just started
joking with him eibout it.
Q Excuse me, a few days after you had first seen
him and talked to Colonel Taylor?
A Yes, sir.
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Q You ran into your friend|
A Yes, sir. So I started just jibber- jabbering,
asking him if they were going to open up a tourist resort
up here, since no other reason for a strip of that type, and
he gave me just a totally blank look. I mean, he had no
idea — and I am convinced he had no idea what I was talking
about .
As it turned out, there was another individual,
whose name I don't remember, but I always called hiroj
who was standing by the other door, and apparently!
had been the guy who had originally coordinated or done the
leg work for the building. He reported it tc
Q He overheard your comments?
A Yes, sir, he did. So he reported tc
that I knew cLbout it and was talking abodt it.
■called, actually wanting to speak to
Colonel Taylor. As I indicated, he was not in, so the
call was given to me, at which point he informed me that —
the first thing he asked me was if Colonel Taylor had told
me about it, and I indicated no, indicated to him how I found
out about it, emd that then I had spoken to Colonel Taylor,
and he had confirmed what I had suspicioned, but it had not
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originated with Colonel Taylor. At which point he told me
that the way his operation and organization worked, not
everybody knew what everybody else was doing, and that he'd
rather I didn't talk about anything that I may find out that
soTC of his people were doing with any other people from his
own organization, because the way they were set up, they
didn't necessarily, as I say, know what each other was doing.
Q Was this entire conversation on the phone, or did
he ask yqu t-^-
A No, sir. this was entirely on the phone.
Q Did it end with any admonition to you to not talk
about the air strip?
A Yes, sir. It was, you know, not formal or strong,
but a mild rebuke. At least I took it as such, you know,
that I don't need you talking about it.
Q To the extent you care to comment, did you form
an impression about^^^^^^Hand those people who were
working for him?
A Yes, sir, I did. In three years there in dealings
with them on different matters, some of which totally
unrelated to this whole issue, I just felt it was about the
most incompetent organization I had ever seen and, frankly.
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I was terrified that those were the guys who were trying to
conduct any part of U.S. foreign policy.
Q Did there come a time when a particular airplane
that was using the air strip for refueling operations had
a problem of getting out?
A Yes, sir. There was one that landed, and in
taxiing to the end of the runway to turn around, it came off
of the strip and got stuck in the mud.
Q Was this a loaded or unloaded plane?
A It was loaded, sir.
Q And how did you come to know about it?
A By this time. Colonel Taylor and I, who had
really developed a very good working relation, was keeping
me apprised of what was happening. I am, as I indicated, 99
percent sure this was sometime after the 8th of May 1986.
Q And why do you date it that way?
A Sir, because the Costa Ricans ' inauguration, if
I remember right, was the 8th of May 1986.
Q Inauguration of?
A Their new president, who had been elected early
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Colonel Taylor, basically, had kept me apprised,
but at the same time, indicated to me, if I am ever brought
in on it by either the Ambassador or the Agency, that would
be the first time I was hearing it, and that's hov I found
out about; it.
Q Did Colonel Taylor — let me ask it this way.
Was Colonel Taylor asked to make recommendations
for the plane to get the plane unstick from the mud?
A Yes, sir. By this time — Colonel Taylor is a
seasoned pilot, both fixed wing and helicopter, knows a
great deal about planes, and when they were talking about
trying to get another plane in there to pull it out, he was
the one saying, "Forget that idea." So he, in fact, was
requested or brought into the conversation.
Q And did he offer a proposal?
A Ves, sir. He and I pretty much together, in
discussing the possibilities had come up with what we felt
was probably the best workable solution, because what it
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amounted to at that particular time was, the only way that
plane *'as going to get unstuck was going to be to offload
its cargo.
A And did you know or were you made aware of what
its cargo was?
A Yes, sir. I was told straight out that it was
aiomunition. Ammunition and — small round ammunition and
!
hand grenade mortar ammunition.
Q Continue with your discussions with Colonel .
Taylor about the plan to get it out.
A Okay. Sir, what basically we had come up with, whic
was then presented to^^^^^^^^^^^^and the Ambassador, was
that I would go up there. At that particular time, the
construction at this^^^^^^^^^^^Hl mentioned earlier
going on. I would go up there and basically borrow -- and I
was convinced I could — a couple of construction trucks that
they had.
Even though there was no road out to this strip,
you could follow the coast line, which was hard enough to be
able to be able to work your way through it, you know, after
a whole lot of hours for a few miles. We would offload all
)f the ammunition, take it to the^^^^^^^^^^Hand just
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donate it to the^^^^^^^^^ as if it had all along been
an actual security assistance delivery coming into the
country that was initially intended for that!
anyhow.
What they felt, that covered the base if anybody
asked, "What the hell is it doing up there?" It could have
simply been just kind of brushed off with the belief it was
supposed to go to the airport in Liberia which was in that
general area, and that a new pilot got confused, saw this
big strip and thought that was it and landed in the wrong
place.
Q This was a civilian aircraft?
A It was a C-7 model. Most of these flew with no
tail markings of any kind. I am trying to think of the
English word for — registration number. Most of them were
some kind of — the ones I saw were like a yellow base
camouflage pattern.
Q Did you have reason to learn the origination
point for this flight?
A Sir, I was told that that flight had originated,
as had the others, in|
bee
Q That would have
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I was not told exactly, you know, where in
I assumed it would have been^^^^^^H, since
that was military controlled.
0 Did Ambassador Tambs ever comment on where this
plane was destined.
A Yes . When we were having the meeting where it
was determined I would go up there to try and offload it, if
need be, he indicated that that plane was going to make a
drop of those ammunition and supplies to the southern front
forces who were in Niceuragua.
Q In Nicaragua?
A Yes, sir.
Q Tell us about that meeting. Colonel Taylor
apparently had been asked to come up with a plan, you and he
talked cibout it, and then there was a meeting.
Who was present at the meeting?
A Colonel Taylor,
and myself were the only members.
Q And it took place where?
A In the Ambassador's office.
0 What transpired?
A Colonel Taylor had a requirement to go to Panama,
Ambassador Tambs
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34
I don't remember the exact nature of it, but he would have
to leave. As a result, I was brought in and briefed by
Ambassador Tambs , as I said, as if it was the first time I
was hearing it# since neither Colonel Taylor ror I let on
that he and I had spoken about it.
I was told by Ambassador Tambs how that plane got
there, when it got there, what had happened to it, what it
was for and that something had to be done to get it out. I
was told by him that Colonel Taylor had come up with what they
felt was an absolutely brilliant plan to get it out and that,
based upon all recommendations emd knowledge of the people,
area and all, I would have been the only guy really available,
as such, to be ahle to execute it, and then they proceeded
to brief me on what the plan was.
EXAMINATION
BY MR. KREU2ER:
Q In fact, you were, were you not, one of the
architects of the plem?
A Yes, sir. Colonel Taylor and I, basically, were
sitting in * place in front of the Embassy, you know, about
3:00 o'clock, in a very private area, just kind of mulling it
over, and sort of got synthesized out of both bits of
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imt^RED
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-rconui. (cra«TEiis >nc
information.
EXAMINATION
BY MR. SAXON:
Q Just in case we haven't overlooked anything for
s-uBsegnent readers of this transcript, the air strip itself
was not paved; is that correct?
A No, sir, it was not. It was packed.
Q So the entire thing was unpaved, so it is not a
matter of xinloading the plane, getting it back up on the
concrete runway and putting the cargo back on?
A No, sir. Even though it was packed hard, it was
not paved. However, that is exactly what they did do to
eventually get that plane out. They unpacked it where it was,
which removed the weight, and whoever they had, you know,
pushed it out of the mud up onto the runway into a hard part,
hard packed, then reloaded it, and it could take off.
Q What was the result or disposition of things in
this meeting with Ambassador Tambs, Colonel Taylor and
and yourself?
A I would be on call, because they were still
trying to get this plane out. There's no comraxinications
from that strip to Sem Jose, sir, so it was kind of like
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e3
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ct-noiui. nrotJtK inc
I' periodically they'd hear something. The determination was
|| that if they couldn't get it out of the mud, I was on call
to leave, you know, on a moment's notice to go and execute
|l that plan.
i|
'( Q And was that the point at which you were told to,
!|
il in essence, stand down?
A Yes, sir; if a phone call came during the evening,
I was told to stand dovm, it's going to make its drop, and
we can forget about it.
Q Were there comments made to you by other
individuals? I believe you told us yesterday, perhaps some
people involved with that^^^^^^^^^^^^Hwould indicate
that traffic did come in and out of this air strip?
A Yes, The personnel up at the^^^^^^^^^f
Iwould coimnent etbout the number of low level flights,
you know, buzzing them in the early hours of dawn that were
just mysteriously disappearing behind that hill, and then
later they see it again, heading north. They would come
from the north and then go back towards the north. I can't
give you any figure on the quantities. I just don't know.
But it wasn't at all an uncommon occurrence either.
Q Is there any doubt in your mind what that air
vxmsMii
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37 !
strip was used for?
A No, sir.
Q And what would you say it was used for?
A It was used to refuel and do whatever needed to
be done to any of the planes that were making aerial drops
in the southern part of Nicaragua.
Q Were you aware of any news stories in the earlier
part of 1986 about this air strip before these matters as
we now know them became public in November? !
A Any news stories?
Q Yes, sir. By newspapers about this strip and this
construction and what it might have been used for?
A None of the newspapers, sir. Not that I remember.
Q And I would assume from that answer that you have
no knowledge of any efforts by any individuals in the U.S.
Government to concoct a cover story for what that air strip
was being used for?
A Not that I know of, no, sir.
Q Let me ask you. Major, about any meetings,
briefings or dealings you may have had with Colonel Oliver
Nortti.
Have you ever met Colonel North?
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A Yes, sir, I have.
Q And I believe you told us yesterday that you
briefed him on two occasions?
A I didn't brief him. I was in a briefing where
he was at on two occasions, yes, sir.
Q Was there anything of significance or note about
the first meeting?
A Not that I remember, no, sir.
Q If you would, then, I think, focus on the second
meeting and tell us about that. When would that have been,
approximately?
A Sir, that was sometime ~ I would have said in
April, March, but I'm thinking more April 1986 time frame.
Q Where did this meeting take place?
A
UNeussiriED
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39
the
A
Sir,
Colonel North,
^^nbassador Tambs was there —
Q
Was
th^^^^^^l
^B there?
A
Yes
sir.^^^^^^l
^^^|was there. I believe
^^^H
^H
^^^^^^pv
■
^^^^^^^^■who
at that time was an individual
Spell that last name.
Was Secretary Abrams there?
Secretary Abrams was there .
Mr. Burghardt?
Mr. Burghardt.
And would^^^^^^^^^^H^ave been there
Sir, I'm almost sure that was the meeting I was
alluding to, where he was.
Q But you're not as sure aUaout him as about the
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others?
A No, sir. There was one other individual. If i
hear the naune, I'll remember it.
HR. KREUZER:
TH£ WITNESS: I believe that's it, yes, sir.
To be honest with you, I was just meeting a whole lot of
people, and it was hard to keep straight, particularly when
my function there, as in many other meetings, was to be an
interpreter.
EXAMINATION
BY MR. KREUZER:
Are you sure^^^^fwas there?
I believe he was. The neune rings a bell.
And you believe Salvin was there?
Correct.
All the other people, you're sure about?
I'm pretty sure about.
EXAMINATION
BY MR. SAXON:
You were there then to be translator?
Yes, sir.
And other than translating duties, you normally
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would probably not have been at such meetings?
A Oh, absolutely not. No, sir.
Q What do you recall as having been the subject
matter of the meeting?
A Well, that was the funny thing, as I mentioned
yesterday. The way these meetings were conducted, the first
part was all the social amenities. That takes a
Q And particularly including this air strip?
A Yes, sir. Now this was just, you know, little
comments made off and on. Then when they really started
talking business, they started talking about what had been
done up until this point.
Q In terms of resupply of the southern front?
A In terms of the general assistance towards the
anti-Sandinista movement. At this time, one of the
individuals — I don't remember, you know. I'm thinking
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UNCLASSINED
tet-naauL iwoitus. inc
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Mr. Burghardt and^^^^^^|, siraply because those were the
two I had never met before .
||
!l
i; Q I believe you said yesterday, a tall, red-haired
gentleman.
A Yes, a tall, red-haired gentleman is about what
I remembered, interrupted the meeting, saying, hey, you know,
he had no doubt as to my patriotism, fidelity and valor, but
ray clearance he didn't think was high enough to listen to the
rest of it and I should he excused from the meeting.
Q What clearance did you at the time hold?
A Top secret, sir.
Q Did anyone at the meeting know you had a top
secret clearauice?
A Everybody in the meeting knew I had a top secret,
sir.
Q But, for whatever reason, this gentleman thought
that might not be high enough?
A Apparently so, sir.
Q So what happened after he made that statement?
A I went to drink coffee with tlxe secretary, sir.
Q And that would not be Secretary Abrams?
No, sir
iSBI^^
222
ns!in[o
43
So, suffice it to say you left the room?
Yes, sir, I left the room at this point.
And did the meeting continue for some period?
Yes, sir. I would say 45-50 minutes.
EXAMINATION
BY MR. KREUZER:
Q This person who asked you to leave, you say he
was the tall, red-headed person?
A I say red. I'm not talking carrot top, kind of
reddish.
Q You can't identify who he was?
A I can't recall. He was the one who raised the
issiie. There was a lot of mumbling about it, basically
mumbling from everybody involved, and Ambassador T2UQbs was
the one who said, "Well, okay, Paco, just so we can continue,
why don't you step out."
EXAMINATION
BY MR. SAXON:
Q Pace is your nickname?
A Yes, sir, that's my nickname.
Q Now, you were present, I think, with some of these
Wussm
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IIHid^S^NtD
individuals riding in the car to the meeting and other
conversations?
A Correct, sir.
Q Before and after the meeting?
A Correct, sir.
Q In the course of that entire period when you were
in the meeting and the conversations before that, did you
j
hear bits and pieces of discussions that would allow you to i
draw inferences about the subject matter?
A Yes, sir. That is part of what I alluded to when
I said little bits of information compiled led me to believe
that the purpose of that meeting was what I had just
mentioned.
Q And you actually heard people talk about the
contras?
A Yes, sir.
Q Is there amything else we should know about that
particular meeting?
A Not that I can remember, sir.
Q
Cf-fCMUL HKITHS. INC
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45
A No, I can't answer tiiat one way or another, sir,
definitely yes or no. I just don't know.
EXAMINATION
BY MR. KREUZER:
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46
EXAMINATION
BY MR. SAXON:
Q Major Alvarez, let me ask you about a gentleman
named Ton Posey — P-o-s-e-y — and an organization with
which he is affiliated called Civilian Materiel Assistance
or CMA.
Did you ever have occasion to see Mr. Posey or
ESCUl ICKMTWS. INC
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47
know that he came to Costa Rica?
A Yes, sir. I knew that he came through.
Q You personally didn't met him?
A No, sir. He was traveling with a Colonel Winberry
— now Wing with a "g" in it or without, I don't know.
W-i-n, I believe, based on pronunciation, Winberry.
They came through —
Q This would be active duty or retired colonel?
A Retired, sir. And I got the impression that.
Posey was retired military, but I may be wrong. They had
talked with Sergeant Sanchez, and I believe they met with
bolonel Taylor. Colonel Taylor indicated to me that something
just didn't seem right, so he said, hold off. He sent some
messages out, I believe, you know, and whether or not they
went to State, Defense Department, I don't know just where,
came back saying, hey, we will not deal — out of this office,
we will not deal with these guys.
Q What was Mr. Posey and Colonel Winberry — what
were the proposing? Wh.it Wiis their parpose in being there?
A They were offering military assistance to the
Costa Rican Government for the outfitting and the equipping
of the Costa Rican Civil Guard, so as to be able to use them
mamm
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UNmiFIED
48
along the border better.
Q What kind of equipment? What was your
understanding in that regard?
A Small arms, small arm ammunition and the
possibility was even mentioned of a couple of planes to be
used for border reconnaissance purposes.
Q As far as you know, did they ever make contact
with any individuals in the Costa Rican government?
A Yes, sir. They made contact with the Costa
Rican Vice Minister of Public Security.
Q What is that gentleman's name?
A His first name was Johnny and his last name was
Campos •< — CT-a'sn-:P''^'^s .
Q And how do you know this?
A Johnny Campos told me.
Q And what did Mr. Campos say they proposed to you?
A Just they basically had — I can't say an actual
lanndry list, but he related a whole long list of items
of things that they could get. Most of it, Campos at least
was led to believe was as a donation. It would not have
cost Costa Rica anything. Primarily, small arms, as I said,
small arm aramiinition, and there was definite mention of a
wmmi
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49
e4
couple of planes that could be used for spotter reconnaissance
purposes .
Q Old Mr. Ceunpos indicate whether they gave him
anything as a gift or token?
A Ves, sir. They gave him a Llama 9 millimeter
matched grade automatic pistol, which was in its own
wooden presentation box and everything. He showed that to me^
Q Did they make amy statement as to whether there
could be mpre of these pistols, if he was interested? !
A Well, I don't know if they could have offered too
many of the matched grade, but, yes, there would have been
more in the way of 9 millimeter and other small arms.
Q From either your discussions with Colonel Taylor
or with Mr. Campos etbout Tom Posey and CMA, was there any
indication that any arms were either intended or could be
made availaible for the contras?
A No, sir, not that I know of.
MR. KREUZER: You said earlier that Mr. Ceunpos
had told you jUsout Tom Posey and Colonel Winberry's meeting
with him and that they said that — did they say at that time
that equipment would be made available to the Costa Rican
military without charge?
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50 -51
THE WITNESS: Yes, sir. The impression that
Mr. Ccunpos got was that this equipment would come as a
donation. He told me that what Mr. Posey and Colonel Winberry
had said was that there was this large group in the United
States ~ Mr. Campos, in fact, mentioned the name of a retired
General Singlaub, saying that this was one of the names,
because he asked me if I knew the name, because it meant
i
nothing to Campos — who were very concerned about the spread]
of communis in Central America and had raised all of this I
i
private money, so as to be able to donate equipment to those
countries who were involved in the fight to stop the spread
of communism.
BY MR. SAXON:
Q Did he mention the World Anticonmunism League?
A Yes, sir, he did.
Q Did he mention Barbara Studley's name?
A No, sir.
Q Or the company of GeoMiliTech?
A No, sir, he did not.
EXAMINATION
BY MR. KREUZER:
Q Did he then say that weapons and perhaps some
ci-nanui MPcmaa. <«
mmmui
230
UNewm
52
reconnaissance aircraft were going to be made available
from these people?
A He was led to believe at that meeting that he
was going to get something.
Q Did he indicate or did you have any knowledge
eibout the amount or the value of the donation?
A No, sir, I could not put a price on it. I
didn't have that information. No, sir.
Q , Did he tell you, specifically, what equipment
and how much would be available?
A In planes, he mentioned the possibility of two
Cessna type. Now whether or not they would be two or six
or what, I don't know. He was talking 'about sufficient
M-j6 rifles, so as to be able to outfit the Guard.
Q How many would that be?
A That would have been 4500 to 5000. He mentioned,
but without quantities, automatic weapons, and be mentioned
it generically. He didn't say 50 calibers or M-60s. He
just said machine guns, basically. Grenades, some type of
armored vehicle, whether recoilless rifle or what, I don't
know, because, again, they were just using the generic term.
CE-fEDCUI. MKNrrtllS INC
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UNWIFIED
53
EXAMINATION
BY MR. SAXON:
Q Did anyone ever ask Mr. Posey where he was going
to get these weapons, or did Mr. Posey volunteer where he
was going to get this quantity of weapons?
A As I said, sir, I felt the indication Campos had
got was that this orgiuiization as such that Mr. Posey and '
i
Colonel Winberry made reference to was raising the money and j
I
that orgjuiization would purchase — - all of these weapons are {
readily available on the market, if you get an export
license. And, you know, that was what Mr. Campos basically
assnmed.
EIXAMINATION
t
BY MR. KREDZER:
Q What was the name of that organisation that they
referred to?
A Which one, sir? CMA?
Q Associated with General Singlaub?
A No, sir. They mentioned General Sin^ub's name;
they mentioned the Anticommunist League , but I don ' t know
that the two were mentioned together rather than just
Mr. Campos asking me if these names meant anything to me.
UNCUWED
232
inssiFe
54 - 55
So that is the only reason that I remember his
mentioning those.
EXAMINATION
BY MR. SAXON:
Q Did you ever see General Singlaub come through
Costa Rica?
A No, sir, I did not.
Q Do you know, personally, an American named John
Hall, who is living in Costa Rica?
A I do not personally know Mr. Hall, no, sir.
Q Have you ever heard o£ him?
A Yes, sir, quite a bit.
Q And what have you heard?
A The story that has been out in the Costa Rican
newspapers and in the media and on everybody's mouth from
the time I arrived in the country, basically was that
Mr. Hall, who was quite a wealthy cattle owner in the north
central part of Costa Rica, had a training center there for
contra forces, provided a facility for R&R of contra forces,
and that the private landing strips that he had on his
property were being used in an resupply effort of the contras.
Q He had a ranch, I believe?
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e-rCKUl. MMMTEIIS. INC
233
Yes, sir. It's a ranch.
Did you ever go to his ranch?
No, sir, I did not.
56
Q Are you aware of anyone from the Embassy who ever
went to his ranch?
A No, sir, I cannot say that for a fact.
Q Did you ever discuss John Hall with]
A I did not; no, six.
Q 'When you completed your tour of duty in Costa
Rica and were preparing to leave,.! believe you told us
yesterday, you had sort of a goodbye session with
Ambassador Tcunbs and also present was the Deputy Chief of
Mission, Mr. Tull; is that correct?
A That's correct, sir.
Q Vfhat, if anything, did they say to you, either
Ambassador Tambs or Mr. Tull, in terms of your good service?
A Both were, I know, quite thankful and very
effusive in their thanks, as they put it, not just for what
the office had done, but for all of the other things that
I personally had done to help the cause, whatever that was,
and for helping out!
Q Did you understand what they meant by that?
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234
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57
A I thought he was thanking me for helping them with
the planes and, you know, matters like that.
Q And this was Ambassador Tambs speaking?
A Ambassador Tambs and Mr. Tull both.
Mr. Tull, basically did what he was best to do,
and that was pcirroting Ainbassador Tambs .
Q Major Alvarez, is there £my thing we have not
thought to ask you, which you think either committee should
know?
A I can't think of anything.
MR. SAXON: Let me say a couple of things for the
record.
Number one. Major Alvarez has appeared here
voluntarily. He has spent a fair amount of time and
inconvenienced himself and changed his schedule to do this
for us, emd on behalf of the Senate Committee, and if I can
speak for the House, we thank you very much for doing that.
Let me say, in the course of this investigation,
we have had in excess now of 50 interviews at the Pentagon
and with Pentagon officials, and I think Major Alvarez has
probably been as forthcoming and as helpful as anyone we
have spoken to, and I want to thank you for that, sir.
mmm
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58
MR. KREUZER: Thank you very much, sir.
THE WITNESS: Yes, sir.
(Whereupon, at 10:20 a.m., the taking of the
deposition was concluded.)
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236
UlLASSiFiEu
mn nO?(^ ^
TESTIMONY OF CHARLES E. ALLEN
Tuesday, April 21, 1987
United States Senate
Committee on Secret Military
Assistance to Iran and the
Nicaraguan Opposition
Washington, D. c.
Deposition of CHARLES E. ALLEN, called as a
witness by counsel for the Select Committee, at the offices
of the Select Committee, Room SH-901, Hart Senate Office
Building, Washington, D. C, commencing at 10:08 a.m., the
^^jgtpBj^9.yi^^flS^J^3^^^oj^ by MICHAL ANN SCHAFER, a
Notary Public in and for the District of Columbia, and the
testimony being taken down by Stenomask by MICHAL ANN SCHAFER
and transcribed under her direction.
Partially Declassified/Released on .-.
under provisions of E.O 12355
by N. Menan, National Security Council
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237
lINGUiSSIFe
APPEARANCES:
On behalf of the Senate Select Committee on Secret
Military Assistance to Iran and the Nicaraguan Opposition:
ARTHUR LIMAM, ESQ.
CHARLES KERR, ESQ.
TIMOTHY WOODCOCK, ESQ.
On behalf of the House Select Committee to Investigate
Covert Arms Transactions with Iran:
GEORGE W. VAN CLEVE, ESQ.
On behalf of the Central Intelligence Agency:
KATHLEEN A. MC GINN, ESQ.
RHONDA M. HUGHES, ESQ.
Office of Congressional Affairs
Central Intelligence Agency
Washington, D. C. 20505
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238
CONTENTS
Charles
E. Allen
By Mr.
Kerr
By Mr.
Liman
By Mr.
Kerr
By Mr.
Liman
By Mr.
Kerr
By Mr.
Van Cleve
By Mr.
Kerr
By Mr.
Van Cleve
By Mr.
Kerr
EXAMINATION ON BEHALF OF
SENATE HOUSE
3
87
99
99
102
174
179
183
184
AFTERNOON SESSION, p. 59
EXHIBITS
ALLEN EXHIBIT NUMBER FOR IDENTIFICATION
1 25
2 30
3 41
4 41
5 42
6 42
7 55
8 67
9 141
10 170
11 172
12 186
13 186
uNeiAssm
239
mmm
PROCEEDINGS
Whereupon,
CHARLES E. ALLEH
was called as a witness by counsel for the Senate Select
Conunittee, and, having been duly sworn by the Notary Public,
was examined and testified as follows:
EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE
BY MR. KERR:
Q Mr. Allen, would you state your full name for the
record?
A Charles Eugene Allen.
Q Mr. Allen, I'd like to start by having you trace
your educational background.
A I was educated at the University of North
Carolina-Chapel Hill, with a bachelor's degree in political
science. I attended the Air War College, 1971-72. I also
did graduate studies at Auburn University, 1971-72.
Q Do you have any advanced degrees beyond that?
A No, not awarded.
Q And you received your bachelor's degree when, Mr.
Allen? ]^^^
A 1957.
Q And you would have joined the Agency immediately
thereafter?
A 1958.
Diwsra
240
k. \. i .(• ZL^k
Q If you would, could you trace through for me your
career with the CIA, kind of going in chronological order up
to the present?
A I was originally assigned to biographic
intelligence, 1958 to 1962. I was assigned for a year doing
systems analysis work. I later went on, from 1966 to 1971,
ir^^^^^^^^^^^^^^^^^^^^^^^^^^Hp r oduc i ng
current intelligence assessments principally on Eastern
Europe and Sub-Sahara Africa; 1971 to 1972, I attended the
Air War College; 1973 I worked on the President's daily
brief, which is a very restricted publication for the
President's eyes only.
In 1973 and '74 I became Production Manager for
current military productior
^^^^^^^1 In late 1974 I spent a tour overseas with my
family, returning in 1977. I headed a staff that was engaged
in the worldwide dissemination of finished intelligence to
foreign liaison and to support U.S. missions and U.S.
military commands worldwide.
I headed, in 1979, up until August '80, I headed
an office for presentations and publications, which did all
the publishing and editorial work for the Agency. In August
1980 I was assigned as a Special Assistant to Frank Carlucci
to work on a special compartmented program. I worked on that
first for Mr. Carlucci and then for Admiral Inman directly
intSStFIED
241
KUiSmD
until November 1982, when I was assigned to the Office of the
Secretary of Defense, where I worked on strategic
mobilization issues.
I returned from the Office of the Secretary of
Defense in January 1985 at the request of Mr. Casey. I was
appointed the National Intelligence Officer for both
counterterrorism and counternarcotics. The latter position I
held from January 1985 to February 1986. I remain today as
the National Intelligence Officer for Counterterrorism.
I also served from February 1986 until March 1986
as Chief — 1987, as Chief of Intelligence of CIA's
Q Thank you. With regard to the 1980-82 period,
when you were Special Assistant first to Carlucci and then to
Inman, during that period of time, particularly focusing on
the fall of 1980, did you^BM^any involvement with the Iran
hostage situation?
^^^Mone.
Q I would be correct, then, that you had no
knowledge of and no involvement in contacts that were made
with Bud McFarlane and other members of then-candidate
Reagan's campaign organization regarding the Iran hostage
situation?
A None , whatsoever .
Q With regard to your contact with Mr. McFarlane,
UNtbtSSffl
242
UNtUSSD
can you tell me when you first came to know or met Mr.
McFarlane?
A He probably attended meetings in the 1981 to '85
time frame. That occurred very rarely on the special program
that I worked both with the intelligence community and with
the Department of Defense. He sat in on briefings that I've
given and in the area of counterterrorism I, of course,
briefed him during the TWA 847, which occurred in June 1985.
Q In terms of making his acquaintance, though, that
would have occurred after the Reagan Administration took
power in January 1981; is that correct?
A That is correct.
Q With regard to Colonel North, you would have met
him for the first time approximately when?
A August 1981.
Q And Colonel North was employed in what capacity at
that time?
A He had been sent over by the Department of Defense
along with two other military officers to work on getting
Congressional approval of the sale of AWACS aircraft to Saudi
Arabia. Because his performance was so extraordinary, it was
suggested that he become a member of the National Security
Council staff. I was working with Lieutenant General — I'm
sorry, he was a Major General at the time — Major General
Schweitzer, and Major General Schweitzer introduced Colonel
UNmtSffiD
243
UlWSIPliD
North to me and to other people in August 1981.
Q That would be Robert L. Schweitzer?
A Yes. He later became a three-star before he
retired.
Q And you would have met Colonel North through
General Schweitzer; is that correct?
A Well, he was introduced to me because Colonel
North essentially replaced and took some of the roles of
Major Christopher Shoemaker, who had served in the Carter
Administration as well as during the first year and a half of
the Reagan Administration.
Q At that point in time, when you first came to know
Colonel North, do you recollect who his immediate superior
was?
A within the National Security Council staff? He
reported at that time to General Schweitzer.
Q In terms of your relationship with General
Schweitzer, at that point were you actually working with
General Schweitzer at that time?
A I was the senior official of the intelligence
community interacting with General Schweitzer on a regular
basis. General Schweitzer was chairman of a working group of
an interagency nature that was engaged in some national
security planning.
Q So that I understand, was your function
ONotitsstfe
244
UIWSIFIED
8
essentially a liaison function on a broad spectrum?
A No. I was representing the Director of Central
Intelligence and the Intelligence Community on a specific
activity reporting directly to the Deputy Director of Central
Intelligence but working on behalf of the Director of Central
Intelligence.
Q In connection with that work did you begin to work
with Colonel North?
A Yes, sir, very closely.
Q I'll come back to that in a moment, with regard
to the AWACS matter, did you have involvement in the AWACS
effort?
A None whatsoever.
Q And you did or did not come to know General Secord
during that period of time?
A I did not know General Secord during that period.
Q When would you have met General Secord for the
first time?
A The first time I met General Secord directly was,
to the best of my knowledge, was the 29th of January, 1986,
when he attended a meeting with Colonel North, ^^^^^^^^^H
Mr. Koch — that's K-o-c-h — and myself in Room 370 of the
Executive Office Building.
Q We'll come back to that, but if I understand you,
you would not have had contact or a relationship with General
mmms
245
mmm
Secord prior to that time; is that correct?
A No, sir. I had heard of General Secord in the
fall of 1985, but I was not aware as to who he was or any of
his background until later.
Q You had mentioned the AWACS matter. You did not
become familiar with General Secord's role in the AWACS
matter; is that correct?
A Not at all.
Q Returning again to Colonel North, the matter that
you were working on with Colonel North in 1981, can you
describe that for us?
A That's a compartmented program. We were working
on a sensitive national security program which I'm not
authorized to discuss, but I can assure you it had nothing to
do with Saudi Arabia, Iran, or Central America.
Q In terms of what it had to do with, you are not
prepared to tell me today; is that right?
A No, sir.
Q Can you describe the nature of your contact with
North during that period? Would you be dealing with him on a
daily basis?
A Frequently on a daily basis because it required a
great deal of planning, coordination, preparation of
memoranda, coordination with senior officials of the
intelligence community, discussions with Mr. Carlucci and
mmm
246
uKCk^sra
10
later with Admiral Xnman and occasionally discussions with
Mr. Casey or briefings of Mr. Casey.
Q With regard to the CIA personnel that worked on
that project with you. Director Casey would have been kept
apprised. )iau woujft ha¥« vorkmA^Sjet ifci f^o else w^ld have
-JMorked on" it at thlFC^ :g- " .y-.^- "^- _^^"\_ "^' ^^ ^
y^ A^ Wi^^ < ^SJ^^ .r.j ^j^Mf^^i^,^^- j^ lilMitBliijil #i&iB>ber
of atrMtjbrat«s and I wi|^ad«^ tjgid^3aift-||^g^^ipJiigf jp>.
I Eiad me ec.,t%fo .i:hi
yu n«!t wha
i^elli^no
:t«>d"^aigpn,
^l^^as^'n^^that typlTof *eti
in terms of your involvemenC with him, what period of^iiBF
was spanned in terms of this particular project with North?
A From August 1981 until 16 January 1985.
Q And during that period of time you were working on
the same project or a succession of projects?
A I was working on one from the intelligence
iimsfflD
247
DNCUiSSIilED
11
community perspective, and then I was appointed, at the
request of Mr. McMahon and with the approval of Mr. Casey, I
joined the Office of the Secretary of Defense and worked — I
worked in a more senior capacity.
Q You joined the Office of the Secretary of Defense
when? You mentioned it before, but I missed it.
A November 1982.
Q And in your position with the Office of the
Secretary of Defense you continued to work with Colonel
North; is that right?
A Yes, sir.
Q And again that would be on the same subject matter
that you'd been working on before?
A Yes.
Q And as to that period of time you do not feel at
liberty to describe what that work was; is that right?
A I'm not authorized and will not provide details on
the substance of the program, except to state that it had
nothing to do with Iran, Central America, Saudi Arabia, or
any type of foreign intelligence operations of any sort.
Q During the period up through January of 1985 the
principal responsible for that project would have been whom?
Would it have been the National Security Advisor or someone
else?
A I'm not authorized to say.
BNttftSStFtED
248
12
Q From whom would you require authorization, Mr.
Allen?
A I would have to consult with senior officials in
the Office of the Secretary of Defense, which I can do.
Q And again, so I understand, your contact with
North would have been on an essentially daily basis up
through January of 1985?
A Essentially daily. We met frequently. We talked
on the secure telephone frequently. We compared memoranda.
I was Deputy Director of a program in the Office of the
Secretary of Defense and there were other senior officials
who were in contact on this program with Colonel North.
Q Did Mr. Duane Clarridge have any responsibilities
vis-a-vis this matter?
A To the best of my knowledge, none whatsoever. I'm
not even certain he was authorized access to it.
Q With regard to the briefings of Director Casey,
you indicated that he would be briefed periodically on the
matters that-,you and Colonel North were working on; is that
correct?
A That's correct.
Q Would it have been your custom to have Colonel
North present when those briefings of Director Casey took
place?
A I don't think Colonel North was ever present.
wmmi
249
uHtussm
13
Q So your briefings of Casey would have been
briefings that you yourself conducted; is that correct?
A Yes, sir. And also I worked for a program manager
at Defense who on one or more occasions briefed Mr. Casey on
the progress of the program and I sat in on those briefings.
Q Can you identify the program manager at Defense?
A I'm not authorized to do so.
Q Now from the interview that we had with you, you
characterized Colonel North's^ role in this matter as not
being operational. Does that continue to be your
characterization?
A Absolutely. He was the NSC staffer responsible
for this specific account. He carried out, I think with
remarkable ability, the coordination role. He first reported
to General Schweitzer and then later to Thomas Re id, and then
later to William Clark on the program. He did an
extraordinary job of coordination of an extremely difficult
interagency activity. He excelled in every respect.
Q General Schweitzer left the NSC approximately at
what point in time?
A General Schweitzer had a tendency to talk about
how the Soviets were going t^ iavada Boland.4U|^jhe latd a
^ygroc^A speech that he gave during his meetings;
unfortunately, he gave it to the press, he gave it to a group
of Army cadres with the press present, and he left the NSC
imebtsstFtED
250
\missm
14
about — I was in Los Angeles and I remember seeing the
headline when he was dismissed from the NSC. Can I take that
for the record and get that date back to you?
Q If you can give me an approximate year, that would
help.
A 1982, I suspect.
Q The main thing I wanted to focus on was what
contact you had with General Schweitzer after he left. Did
you have any contact with him?
A No, sir. I saw him in the EOB in the halls a
couple of times and said hello and we chatted a little bit,
just personal pleasantries — no substantive conversations.
Q Specifically do you recall having any contact with
General Schweitzer in the period September 1986-forward?
A _v;.AdB|fa,|jWltgt5|p|fe,ftig^n the October '86 time frame
where we simply exchanged pleasantries. He indicated he was
doing some special consulting work for the NSC.
Q Do you re^^l discussing with him at that time, or
any time subsequent to September 1986, his employment with a
firm called Geomilitech Consultants Corporation?
A No, sir. I did not. General Schweitzer and I
simply reminisced about the program that we had worked on
jointly before he was asked to leave the NSC.
Q You have no recollection of discussing with
General Schweitzer his efforts to obtain covert procurement
mtmma
251
M^SIEliD
15
contracts for Geomilitechl
A I did not discuss that with him.
Q Did you have knowledge that General Schweitzer was
endeavoring to obtain such contracts for Geomilitech?
A No, sir, I did not.
Q With regard to the appointment that you received
as NIO for Counterterrorism, can you describe for me how you
acquired that job?
A In the October time frame of 1986 John McMahon —
Q 1980
MkftSSIKD
252
UNCUWKD
16
A 1984, I'm sorry — called me on secure at the
Pentagon and asked me to come see him. He offered me the
position of National Intelligence Officer for both narcotics
and counterterrorism, stating that Mr. Casey would welcome my
return to the Agency. There was some negotiation over this
because I had been asked and offered an even more senior
position at the Pentagon, so there was some deliberations
which did not really come to closure until the January time
frame. So I finally came back in mid-January 1985 to assume
the position.
Q with regard to that position, there had been one
prior NIO for counterterrorism?
A That's correct,]
Q Did you have discussions with Mr. McMahon or Mr.
Casey zJsout changing, broadening the mandate of the
counterterrorism NIO?
A Mr. NcMeihon and Nr. Casey indicated that they
wanted a more activist National Intelligence Officer. As I
recall, Mr. McMahon said that he expected me to shake the
intelligence comunity up a bit, that terrorism was an
extremely high priority of the Administration, and that more
work needed to be done in that arena.
I proceeded to undertake a number of initiatives
that I thought would satisfy Mr. Casey and Mr. McMahon and by
the time Mr. McMahon had left the Agency I think he was
m&mm
253
yi(UM0i4i>iiii.i^
17
satisfied we had a lot of activity under way, and Mr. Casey
encouraged me to take a very active role within the
community.
Q Let me focus in on the gestation period, if you
will, October-November 1984 when you were considering taking
the job. Did you at that point have discussions with McMahon
or Casey in more specific terms on the new policy, new
direction, new approach that you would take to the NIO
position for counterterrorism?
A Not in any great detail. Mr. McMahon and Mr.
Casey indicated I should come in and take a hard look at what
needed to be done. Mr. Gates also supported it. He was
chairman of the National Intelligence Council. So I did that
immediately, but we did not have any detailed discussions on
just what needed to be done. The idea was that we were in a
more reactive mode than we should be; we needed to be in a
more active way in counterterrorism.
I was familiar with National Security Decision
Direct ive^^Hbecause I had discussed it with Colonel North
some time earlier. I also was aware of National Security
Decision Directive^^^ which was issued, I guess, in 1982,
because I had worked closely with Major Chris Shoemaker, who
was Colonel North's predecessor. So I was aware that there
was dissatisfaction throughout the government on the United
States counterterrorist policies. s ^*°":
wmwrn
254
UNCUSSiED
Q Let li c^^|iudr^to~Nat^on^t S*eun^i£»ireot ive
HH| You-dtt^ ypt^tjeugaii^fanlr TrttdBji^th . When would you
have discussed that with North?
A Probably — I think it was issued in April of
1984, about that time fram«pE^i>6ias he was helping
coordinate the final drafts of that.
Q Can you relate for me your best recollection of
the nature or content of your discussions with North about
National Security ^^g^^n^^^| ' "«^- "^ ~?" . .,~ "^
..A I-ipwib ^5PVBgbri*lE^|scussion. I was in his
office discussing the other classified common project, and he
indicated that he had been working on the draft trying to
coordinate with a variety of agencies, and that he felt he
had in this draft the proper direction to government agencies
and departments so that a more activist approach to
counterterrorism could be undertaken. He was working at it
quite hard, as I recall.
Q What was the nature of the activism that he was
trying to inculcate, if you will, at that time?
A Well, he wanted, for one thing, an intelligence
fusion center which would bring together on a
multidisciplinary nature!
Iso that they could quickly compare intelligence and
integrate the intelligence. That was one of his greatest
desires,.^
255
19
^^1S Ifoi^ou woul4^ M'^^iiiad that ig^^Bsnctkon. in the
spring of^'^84. or^lBiereabouts wij^ regard to*tha€^T»tioh of
fusion, if you will, of intelligence matters on terrorism.
Was that something you considered and discussed with North at
the time you were contemplating becoming NIO for-^a^
counterterrorism?
A We had a discussion, I believe, in the December
'84 time frame when I was still weighing whether to come back
to CIA and join the Agency as the National Intelligence
Officer. He went over that and his views on that in late
1984. It made a lot of sense to me, and we have subsequently
implemented that type of integrated center at CIA.
Q When did the implementation take place at CIA?
A That occurred in February '86 with the formation
of CIA' s^l^^^HH^H^^I^^H with as
director.
Q So in a sense you would see the gestation at least
of some aspects of^^^Jgoing back North's concerns and
interests in 1984; is that right?
A That's correct. I think he had a very inspired
idea, which I think has proved correct.
Q In terms of your discussions with Colonel North
about the NIO position for counterterrorism, did you have
discussions with Colonel North about whether he thought it
was a good idea or not a good idea that you take that
IIHCIISMD
256
20
position?
A He wanted me very much to stay in the Department
of Defense. He opposed my returning to CIA very strongly.
Q Why was that?
A Because he felt that the country's national
security, because he believed that the project on which I was
a senior manager, the number two manager — and I would have
been elevated to the overall manager — was more important by
far than coming back to work on counterterrorism. I'm.
convinced that was a very sincere belief on his part and
there was a very major struggle over whether I should come
back or not. And I remember Mr. Casey joking that Defense
had kidnapped me but that he had liberated me.
Q Do you know if North discussed with Director Casey
the merits of your return to CIA?
A Very definitely more than once, and both Mr.
McMahon and Mr. Casey said that Colonel North adamantly
opposed my return.
Q Do you have any present recollection of when
Colonel North would have had these conversations with
Director Casey?
A I would believe that would be in the November-
December time frame of 1984.
Q As of that period of time, November-December 1984,
did you have any impression of the relationship between
wmmw
257
21
Colonel North and Director Casey, as to whether it was close,
a working relationship? Can you describe that?
A Well, it seemed to me that it was certainly a
developing relationship and one where Colonel North had a
great deal of respect for Mr. Casey because he spoke highly
of the Director.
Q As of that time, the fall of 1984 — winter of
1984 — did you have any understanding of the extent to which
Colonel North was in contact with Casey? Were they meeting
on a regular basis, to your knowledge?
A It was my understanding that they met
occasionally, based on what Colonel North stated.
Q When you say "met occasionally", do you have any
sense of how frequently they were meeting?
A I can't state that. They occasionally, I think,
had breakfast on Saturday mornings together, but that was
only what Colonel North told me.
Q In terms of the knowledge that you had in the
latter part of 1984 about occasional breakfasts on Saturday
between Director Casey and Colonel North, it was your
understanding from Colonel North that such breakfasts
continued through '85 and '86; isn't that correct?
A I don't know whether they had breakfasts. They
continued to have regular contact.
Q In the early part of 1985 when you took over your
mmmm
258
vmmm
22
position as NIO , let me focus on the first quarter of 1985,
to what extent would you have had contact with Director Casey
during the outset of your new position?
A Mr. Gates, as Chairman of the National
Intelligence Council, encouraged the National Intelligence
Officers to meet on a regular basis with the Director to
discuss substantive issues of concern to each NIO, to brief
the Director on intelligence estimates that may be under way
or important intelligence issues. One of my activities was
to chair the Interagency Intelligence Committee on Terrorism,
a committee I still chair, to explain how each agency was
approaching counterterrorism issues, so I met periodically
and regularly with Mr. Casey one-on-one.
Q With regard to your work, to what extent would you
have been in contact wltW'lifS^rKLam Fuller, who
th^^^SlF East and South Asia at '"^
A We had occasional^ii^Rnft^sations. He was a Middle
Eastern specialist. Fifty percent of all international
terrorist inci^lKs o<^St in the Middle East or originate out
of the Middle East. It was important that he and I maintain
regular contact;
Q And you did in fact do so?
A We did, yes.
Q In January-February 1985 were you aware that
Director Casey Wi^ maiking an approach to^^^^^^^^^Hto seek
259
ONCUSSIHED
A No, sir.
Q And you were not aware at that time of an approach
by Director Casey toH^^^^^^^^^for assistance to the
Nicaraguan contras^ is tlat correct?
A I was not aware.
Q Were you aware of any approach by Casey]
|support I
iNicaraqrua?
A I was not aware of that.
Q So, to understand you, you would not be aware that
on February 25, for example, Director Casey was meeting with
Admiral Poindexter to discuss those matters and funding for
the contras more generally?
A I was not aware of that.
Q Were you aware at that time, February of 1985, of
0
pwn as the I^nimbo that was bringing arms, thought
to be bringing arms and ammunition from Korea to Nicaragua?
A I don't think so. The name is familiar and there
was some publicity, I think, eibout this.
Q There's been f i i i 1 j . Wii eiil^liiAi^mWMMMl \ nii
have any contemporaneous knowledge?
A At the time I had no knowledge.
260
wmssm
A No, I was not aware of that^
Q You did or did not have knowledge of a trip tj^t
General Singlaub would have made t^^^^^^^^^^^^^H in
January o^R.*lfe?
A No, I'm not aware of it.
Q Did you know GeMRral ^S^laub at that tli
ion't know General Singlaub at all.
Q In April of 1985 Mr. Fuller prepared a memorandum
for the Director with some thoughts on Iraig T?cjyou recall
seeing that memorandum? ^^^s^ ^^£ .^^^^F' \^^^^^L
A I don't recall seeing it. I recall discxrttmjgiig.jgg
our mgn^lfcjSBf f meetings of the National Ir
Cq^l^J. where Mr. Fuller talked about Soviet initiatives ~- ~
^^^VQl^t^ly directed again^^UBSB^^^e need for the United
States to find proper countermeasures to whi'C^^thought was
increasing Soviet aggressiveness. It is conceivable that I
saw the memorandum at the time. I HtSv^^Sml^^^^O^^^^- ^^ •
But I recall discussions and I recall that Mr.
Fuller was working on an estimate, I believe, in the May '85
time frame on Iran, and that~wsi^ra^^WBP^^3iWy SC staff
meetings.
Q Let me show you the memorandum. It's a memorandum
dated April 4, 1985 from Graham Fuller to the Director which
0
261
UNCLASSra
25
I'd like to have marked as Exhibit 1. —"^^
(The document referred to was
marked Allen Exhibit Number 1
for identification.)
Q Mr. Allen, if you'd take a moment to glance
through the memo — take as much time as you like. What I'd
like you to do is tell me first if you've seen this
memorandum and, secondly, your best recollection of when you
would have seen it.
(Pause. )
It has an NIC number on it, NIC 01799-85. It's
carried in our records — that is, the Senate Committee
records — as Document Number C-2519 to 2520.
A I think I was aware of the fact that Mr. Fuller
was concerned about this issue at the time it was discussed
in the NIC staff meetings. I saw the estimate that was
produced in May of 1985. I cannot recall reading this
memorandum until, I believe, after the 25th of November 1986.
It is conceivable that he sent me a copy. This is what I and
other NIOs do frequently, where we will become seized with an
issue, discuss it with specialists in the community, and put
together our own think piece, as Mr. Gates has explained, and
send it to the Director for provoking thought.
We do this without necessarily informing the
Chairman first. We give him an information copy. We would
262
uHsyiSsra
26
send copies to key people in the Department of State,
Defense, and the National Security Council staff. I did it
frequently.
Q In terms of what would have prompted Mr. Fuller to
prepare this specific memorandum, you do not know what would
have prompted him to do it?
A I don't want to speculate on that, except in the
context of what he stated at the staff meetings, where he saw
the disintegration of the Khomeini regime, a very ill
Ayatollah, factional infighting, and Soviet initiatives both
through military exercises to the north of Iran and through,
as I recall, subrosa subversion. He felt it was a matter of
real concern at the time.
Q In terms of prompting a request or the language
that you all seem to prefer, tasking by either the National
Security Council or staff, or Mr. Casey, do you have any
knowledge of any such prompting or tasking to Mr. Fuller in
April 1985?
A I understand that he was tasked by the NSC at the
time.
Q And you have that understanding from what?
A Mr. Fuller, I believe, indicated he had a tasking
from the NSC to produce an estimate. In the summer of 1986
Mr. Ledeen indicated that he had encouraged Mr. McFarlane to
ask for an estimate.
ItNetJtSSMD
263
WJ^i
27
Q And Mr. Ledeen indicated that to you in the summer
of 1986; is that correct?
A That's correct.
Q Let's go back now to contemporaneous knowledge,
though. In the spring of 1985 did you yourself have any
knowledge of a request for this kind of work product going
from the NSC to Mr. Fuller?
A As far as the estimate was concerned, it is my
understanding that it came from the NSC, and I can't recall
who did the tasking.
Q Now as an NIO your staffing resources, your own as
counterterrorism NIO or what — who did you have as a staff?
A In 1985?
Q Yes, sir.
A I ha
|l had chief of staf
Q In terms o
A That's correct.
Q ^^^^^^^^^^^Hhome , if you will, where was he from
at that point? ^=&,- r.
A ^^^^^^^^^^came from the President's Foreign
Intelligence Advisory Board, where he had worked for a period
of time. He had also worked with Air Force intelligence at
one time. He worked on the Soviet Union. "^'l:
^^^^^^^^^B background?
■:cl
264
musMn
28
A ^^^^^^^^^^^H background is out of the Defense
Intelligence Agency as a current intelligence officer. He
worked then at the Intelligence Community Staff and began
around 1982 focusing on counterterrorism, and he joined me
when I came aboard, shortly after I came aboard as the
National Intelligence Officer.
Q Anc
A She came out of the Intelligence Community Staff,
too.
individi _ _^^^ -,=-—,
in th^^iiAeilliMlica pir«<^ii:iit^^
A Yes , and I tasJcthAm f requaifg
MtSWO
265
29
is the office d^ctorsP^ l?«^li«^J^ angijgfsts on a
frequervfe^lwsais. *''" 7 '~ .iy..;=^^^p:^ ,■ --C^"*-:-^ * -^
Then there ^^I^^H^^^^^^^^I ^^ ^
recollect.
A That's correct, sir, and that wa
an(^|^^^^^^H^^^^and I, of course, would task that office
for support.
Q As betweei^^^^^^^^^^Boutf it anc
"^ith one of these groups
as opposed to the other more^ftoiey
A Well, at the time, in 1985 ^^^^^^H had a
counterterrorist staff withir
Tha t ~(Am^if^rnr t^^^ftiT WHK^I xi
H
February
A
counterterrori
Q And tracing that back in time, in 1985, insofar as
you were looking for Intelligence Directorate assistance
basically you would have worked with the Counterterrorism
mwm
266
tHi
30
group of analysts that were inl
A That is correct. And I did tasking of those
analysts, along witt^^^^^^^^| in particular.
Q Moving into May of 1985, Mr. Fuller did another
memorandum for the Director. I am certain that you are
familiar with that memorandum as of today. Do you recollect
when you would have become familiar with that memorandum?
A -^-.^an _youg^entify the doci fflwnf ? _
'^ -Q -^ '^IM^'Wi^fwt show it^^ yo^ Lat ^^^^v'^ytia vt .
Fullecfs-aAmo of Hay 17, 1985 to the Director, subject"
matter: Toward a Policy on Iran. My copy of this document
has attached to it Talking Points for the Director dated May
22, 1985, which I will show you as well. In terms of
identifying the document, t:her«'s^^l kin^kof numB^jp- on it.
Th«Jai>jri^. frmpj ttipt^ ra^lOKging system is document number C-
2243 tfif?ough^348. Executive Registry numbering system is
Executive Registry 235 through 240. And God knows what the
other numbers on those mean.
After Mr. Allen has a chance to look at it, would
you mark it as Exhibit 2?
(Pause. )
(The document referred to was
marked Allen Exhibit Number 2
for identification.)
A I recall reading this in the spring of 1985. Mr.
y
267
Fuller provided me a ^py',y^ .^I~' ^~ *
Q To heip^u^ft^s in on t*atx it would be your
recollection'that you v^BU^MMI^wn this -^^^ent at or
about the feime of iS dftlt-r^ffli«l-ittty J.9*5? "^
A I feeL,jeonf4!^nt ^%^id. .^_'" 'W*^ _ Wt.
ItedEJjyt Mr. Fuller about
p writitHJkby Iff.
this matter Prior t^; ft
Full^^
Xk ^miiii ^tanTiiTi'lll^^^^itT
Q There's a reference on page 3 of the memorandum to
a suggestion by Mr. Fuller that one avenue for improving
relations with Iran or establishing relations with Iran would
be to open up arms sales by American allies to Iran. Do you
see that?
A Yes, I recall that.
Q Do you recollect discussing first with Mr. Fuller
that suggestion in May of 1985, you yourself?
A No, I did not discuss it with him.
Q Do you have a recollection of discussing that
suggestion with Mr. Casey in May of 1985?
A I have no recollection of discussing this
memorandum with Mr. Casey.
Q Do you recall your reaction to Mr. Fuller's
suggestion of opening up arms sales to Iran?
A I don't recall my reaction to that aspect. The
UNCtJtSSIFIED
268
UHEkl^W
32
idea of trying to end the geostrategic vacuum in Southwest
Asia I endorsed, that we ought to do some probing into
Southwest Asia, and I firmly believed that was an appropriate
issue to suggest, that all the options be explored. -v^~^
Q frankly I suspect that that notion in a general
sense ranks alongside motherhood and apple pie. When we get
down to the nitty-gritty of having allies sell arms to Iran,
do you recollect your reaction to that notion?
A I don't recall. I think I mentally dismissed it
as not a very likely proposition.
Q Specifically focusing in on what allies Mr. Fuller
might have had in mind, if I am remembering that portion I
think he does make mention of Israel as an ally that he might
have been contemplating. Whether he does or doesn't, do you
recall understanding in May of 1985 that Mr. Fuller had in
mind the sale of arms by Israel to Iran?
A I never had such a conversation with Mr. Fuller,
and I have no idea what he was thinking. I just can^
SSSt ^^ou^Mk* occasion to discuss wit
in May of 1985 his reaction to Mr. Fuller's May 17
memorandum, specifically his suggestion that the United
States contemplate its allies selling arms to Iran?
A I did not have a conversation witt^^^^^^^^H
Q Mr. Allen, in the late spring-summer 1985, the
«(tCt«SIFIED
269
|Jl\'viiW'Wvi«3M'5KD
33
period May, June, July, 1985, what responsibilities, if any,
did you as NIO for counterterrorism have with regard to
tracking efforts to release the American hostages that were
held in Lebanon?
A I did not have a direct and central role at the
time. The White House, Mr. McFarlane in the White House had
diracted th&t. aF ^gltaf« r**^inri tjllii fapiin be estabfisl^d, X
270
My role was not direct. I had global
responsibilities in counterterrorism and I did not have an
operational responsibility. But analytically I continued to
look at the issue.
Q Let me sort of back up and go step by step. First
of all, how do we spell J
A
Q And his titl«
A He was chief of what was then called the — it's
changed its name. It's now cal]
Q And, if I am understanding you correctly, there
was no formal working relationship between you and your group
and him; is that correct?
A That's cotrect. But we interacted and I had
271
UHCUSSlEe
35
weekly meetings witt^^^^^^^^^ or tried to have weekly
meetings or biweekly meetings to exchange views. We had a
very mutually-supportive type relationship.
Q Now I didn't really understand your reference to
McFarlane and the White House direction. Take me back.
A Prior to the establishment in late December 1985
under me an interagency hostage location task foi
individuals were not dedicated full
time to locating and determining the condition of the
hostages, but these were agency representatives to an
interagency working group.
I read the reports of those
meetings. It included agencies like^^HoiA, DEA, State, as
well as CIA.
Q You were not formally designated to be part of
that working group?
A Not at all.
Did that group have a name?
Called the hostage location task force.
Was Colonel North a member of that group?
Colonel North attended many of the meetings but
Q
A
Q
A
not all.
SfCl
272
Q You became aware, did you not, in mid-June of 1985
that Director Casey had heard from a friend or business
acquaintance by the name of John Shaheen that a gentleman by
the name of Cyrus Hashemi had made a proposal on how the
hostages, U.S. hostages in Beirut might be exchanged or
freed?
A I was not aware of that initiative in the summer
of 1985. Mr. Casey later recounted that to me, I believe
more than once. But not in 1985. I believe he recounted
those incidents in 1986.
Q Let's go with your memory in terms of when you
recall becoming aware. That you would place that in 1986?
A I believe it was in 1986. He mentioned his old
colleague Mr. Shaheen, who I believe worked with him in the
Office of Strategic Services, but it was more anecdotal than
anything else.
273
fi*!!:
r'^T
37
Q Again, let's go over what you're recollecting.
What is the context that you recall Casey bringing this to
your attention?
A It probably was in the context r ,
which occurred, I believe, in the summer of 1985
that Mr. Casey was talking about his old colleague Shaheen.
Q When and under what circumstances did Casey
mention to you that his colleague, friend, business
acquaintance, Shaheen had mentioned this?
A You're going to have to give me a moment to
contemplate that, if you will, please.
Q Take your time.
(Pause. )
A I cannot recall precisely the date, but it seems
to me it was around the time of the McFarlane trip to Tehran.
Q So that would be May of '86?
A In that time frame. He provided details on that
as well as details on his understanding ot
was more or less in the context
of that discussion, but I can't put a precise meeting and a
precise date on it.
Q Give me as much specificity as you can on what it
was that Director Casey told you eQjout what Mr. Shaheen had
told him.
•»im m-viLiL
m\'.
274
uNcmnED
38
A Only that this was an old friend who had cancer,
who was terminally ill, and that Shaheen had been in touch
with Cyrus Hashemi and Hashemi, I guess, was under indictment
for some violation of U.S. Code, and that there was a
proposal, and I cannot recall the details of that proposal as
described to me by Mr. Casey.
Q Shaheen, it was your understanding, was dying of
cancer in June of 1985?
A In that time frame.
Q And you had this conversation with Mr. Casey in
May of 1986, to your best recollection?
A I can't put a time frame, but I'd say maybe in the
spring of 1986, about the time of the McFarlane trip to Iran.
Q Is it your recollection that Mr. Casey indicated
that Mr. Shaheen had spoken with Mr. Casey directly or had
some intermediary spoken with Mr. Casey?
BNWSSffJED
275
uNcusm
39
A It was my understanding that Mr. Shaheen had
talked to Mr. Casey directly, but that's just my
understanding .
Q Do you have a recollection of Mr. Roy Furmark's
name being mentioned in connection with the Hashemi
information that Mr. Shaheen has passed on?
A I don't recall that name in that time frame, no.
Q Do you have a recollection of reviewing this
matter as it was mentioned in the Tower Commission report?
A May I see the Tower Commission report?
Q Vou can see it and let me read the passages.
A I thought you were going to read it; I'm sorry.
Q Quoting from page B-13 of the Tower Commission
report, which says "On June 17, reference 1985, the Director
of Central Intelligence heard from his long-time friend, John
Shaheen, that a Dr. Cyrus Hashemi, under indictment -for
attempting to sell arms to Iran, claimed to have discussed
with the Iranian Foi^^m|p||0bry an exchange of hostages for
the release of the Da'wa prisoners in Kuwait, TOW missiles
and a nolle prosequi for Hashemi." The reference is a Casey
to the Chief, Near East for Operations, who was then^^^B
^^H I think, June 17, 1985.
A I recall reading that in the CIA Inspector
General's chronology. I also recall reading that in the
Tower Commission report.
HNEtASSIflED
276
UNClASSIEe
40
Q with that reference before you as kind of a memory
hook, if you will, do you have any further or additional
recollection of knowledge that you would have had, and I now
really want to focus on contemporaneous knowledge in June of
1985 that Shaheen had made such representations to Director
Casey?
A I had no knowledge at the time of this activity.
Q Let's pursue it just a few more moments. It would
be your testimony here today that you had no knowledge in
June of 1985 not only about this matter but also in June of
1985 you had no knowledge of a joint business venture
comprised of Mr. Hashemi, Mr. Adnan Khashoggi, Mr. Roy
Furmark and Mr. Ghorbanifar to engage in sales of goods to
Iran in exchange for oil from Iran; is that right?
A I have no contemporaneous knowledge in June of
1985 of that activity. As you recall, Mr. Furmark described
something like that in my discussion with him on 16 October
1986.
Q Yes, sir, and eventually we will get to October of
1986. But in June of 1985 you had no knowledge of these
activities?
A No, none at all.
Q Mr. Allen, let me pursue the thought a bit
further. Let me suggest to you that following the contact
that's referred to in the Tower Commission report there were
DNEliSMD
277
UHGU^ffi
41
additional contacts made to the Central Intelligence Agency
to the effect that Mr. Hashemi and other folks with contacts
Iran into^^^^^^^^^^^^^^^^^^fand Manucher
Ghorbanifar in June and July of 1985 who were proposing an
exchange of American hostages for various items of interest
to the Iranians, including TOW missiles in June-July 1985.
Again, did you have any contemporaneous knowledge
of those contacts with the Central Intelligence Agency?
A I had no contemporaneous knowledge.
Q Let me show you materials that have been provided,
regrettably in an expurgated form, which I hope to remedy at
some point with the Central Intelligence Agency, but let me
show you first a cable dated July 9, 1985, which has all
kinds of numbers all over it. The Senate's number is C-1477.
The Central Intelligence Agency number is CIIN 1034, which
I'd like to have marked as Exhibit 3.
(The document iStKf^B^^^^
marked Allen Exhibit Number 3
for identification.)
Second, let me show you a document from Peter to
Arnie, dfi^UJuly 11, 1985, which has a Senate number on it
somewhere which I can't find for the moment, but also has a
CIIN number, 1033, on it, which will be Exhibit 4.
~'i^:. ^ (The document referred to was
marked Allen Exhibit Number 4
llNttfSSW
278
UHSkASSIEIED
42
for identification.)
Exhibit 5 has a Senate Select Committee number, c-
1475. It has a CIIN number, 1032, and it is a cable dated
July 12, 1985. Again, regrettably it's also been expurgated
by the Central Intelligence Agency, which is a matter we will
take up with them once again at a later time.
(The document referred to was
marked Allen Exhibit Number 5
for identification.)
Let me show you another part of the set. It's a
companion to one of the cables that you've already seen, but
it has Senate number C-1477, CIIN number 1034, and is a cable
of July 9, 1985.
(The document referred to was
marked Allen Exhibit Number 6
for identification.)
A Exhibit 3 and 6 are duplications.
I'm ready to respond to questions.
loo)(
any tima?
,,^«^^
those do
contemporaneous -knowled^l^^h^^'yq|ph«d o^^lisiie isatt«
lISSfftfD
279
UHCL^iED
•~iA ijlfiacl no con%imporw«oui^ IcnowiedM offfiese ,76- -.
matters, of whe^^as Joiy-T.sfflK' - _..£.. .^ny::- :"""X,. ■- '
- Q J^ aifl^ time dfit ItrcggW tS ig«ar._attentJb>n tfift the
Central "Intel lijpftce Agency, though its Operatiojut^
Directorate^ or any other DiFagtorate^ waa engag«;^ is^ the-r
activit
ill thoui
^^__^ ^ ., ?ig context ;:gE
ha^BBo JbowleJItC Spuftydll^i^^^Bi*'- - Cj^^ln-a generic va.%z
was I -TTr-nr nn-r^ifiT'TmilliMl mil j-T- D^Sf^t<^f
Operations to try to locate and determine the condition of
the American hostages.
Q Have you at any point in time, up through and
including today, had discussions with any Central
Intelligence Agency employee with regard to the contacts or
attempted contacts by Manucher Ghorbanifar in July of 1985
relating to the American hostages in Lebanon?
A Including the conversations up until today, yes, I
certainly have. I had Mr. Ghorbanifar's 201 file for a
period of time and reviewed it. I don't recall the specific
cables here, although unquestionably they were in his file.
He has about a three-volume file.
Q Four, as I recollect.
A It's hard to remember them all. I may have
actually read these at some time. I don't recall it. I, of
lEtKSfftEO
280
uKey^sKO
44
course, have discussed the fact with Mr. Cave that Mr.
Shackley met with Mr. Ghorbanifar in the fall of 1984 when
Mr. Ghorbanifar made some proposals relating to the American
hostages. I, of course, discussed with Mr. Furmark in the
October and November time frame discussions that he had had
in 1985 with Mr. Ghorbanifar.
Q When did you have Mr. Ghorbanifar's 201 file?
A I believe I had it a couple of times. I had it, I
guess, in the fall of '86. I became more focused on it.
Q The fall of '86?
A Yes.
Q Can you be a little more specific? Vfhen in the
fall of '86?
MR. VAN CLEVE: Excuse me. Did you mean in 1986?
THE WITNESS: Yes. I was looking at it in the
fall of 1986. I had the burn notice on Mr. Ghorbanifar in
December of 1985 after I became aware of who a certain
individual known ^^^^^^^^^Bas Ascari really was. I don't
think I ever reviewed M^g^Si^SJi^^hOrBan 1 f «r 2 Of^lTt J e ^^^
untiSfch#; f a&^of ittK-^ - -si " ''^^^fe,..J& - - -^iaar: - ^^-
1986?^ ■" -^'-^^ ' '-^"^i^-^ —-^- "_^:-."-; ---y-
_^ -^ I^i^teapwas aSS^theP^^^Sa^nmi wijariTl was
281
45
becoming concerned over what I call the first channel, and I
wanted to again go back and read everything I could about
Ghorbanifar. I never got through it all because I had at the
time numerous other duties, but I scanned through it. And it
sat in my office for a couple of weeks, I recall.
Q Is there any particular event that you can
associate your interest in reviewing the 201 file to? Was it
the trip Mr. Nir made into Washington, D. C. in September of
'85? Was it the concern over pricing in August of 1985? Was
it Furmark's visit — excuse me, '86?
A I suspect it was a combination of those. I wanted
to review, particularly to go back to see what was in the
file because Mr. Furmark spoke about Mr. Ghorbanifar having
raised the issue relating to the hostages, I believe as early
as January '85. And then, of course, I had heard from other
people that Mr. Shackley had had a conversation with Mr.
Ghorbanifar in the fall of '84.
Q I apologize. I did misspeak. The Nir visit was
September of '86. Was it at that time you looked at the
Ghorbanifar 201?
A I can't' recall the specific date.
Q You did mention Mr. Furmark. The first occasion
that you would have had to speak with Mr. Furmark would have
been in October of '86?
A 16 October is the first time, 1986, was the first
hi
282
UNCUSSIHED
time that I met Mr. ^sartc.^rreel^. _ "^
Q Is it your racolleeC^ien you would have reviewed
^je Ghoctenifar sar^n preparatifli^fpr'that conversation in
Octob«^of 19B6? _ '^'\~~- z^^-'"^--^
A .' Itdwt-%-recall 9S^o th^dHMWon. '"1 believe it was
probably after the «lr vii^^in^o^p^^mber that'll looked
•^ at the 201, file-. _^ ,^- ",. ^^^"^^^ ^-^ ...^^ - ^:
Q ~But^^a^^ eg^ t^hffT^r^f"^^>^simpJ^^did not
'^^^^ve knOWle#e of tlye Hj^ajenJl^jg tji^ WSffiei^Sf^^en
'""tnl^r^ve WSSSSSt mi^l^^^4l^^^ii^ iJL^«^ c:o^»:t?'
^-^'Q -,_^^3SrrfPone JegFltttn U " jULjtg^lfJBfefejffia WJt J^^ in July
: iilFnnT ifl^'HiB jljiiffjl nTjtriJili*' niiJITi Tinii iiTifii it did
l;%y jUishemi w&^
w ^^^
Q I'm sorry to be tedious on this, bu
on LUsiUBUBss _thee4fc^atters
"tha& c^^itr^^hese
^lative
did not
yiffittsaiifo
283
UNWKJ)
47
raise with you the Hashemi contacts in June-July 1985 when
you talked with ^^^^^^H in December of 1985?
A To the best of my knowledge I did not.
Q At the same period of time as these cables, July 9
through 12, 1985, Mr. Bud McFarlane is said to have met with
Mr. Schwimmer and Mr. Kimche in the Tower report. Did you
have any knowledge of those meetings going on at that time?
A Not at that time.
Q Secretary Shultz told the Tower Commission that he
knew of Ghorbanifar's identity by July 16, 1985 and indeed he
knew by July 16, 1985, of the Ghorbanifar burn notice as a
result of reviewing intelligence reports at that time. Again
using that as a way of trying to focya. your recollection,
3U ^MBuself woOia
d9*»^hat xAfce^L your.^«coll*ttion ,^<
have iowwiT'e^ffte "l&sheai-^lJferbanirar^^initiati^Fr
time £rame.
^.Jt-."-;'
284
0^ ^iT 'ji'i* third week of August 1985, according to the
Tower Commission, Mr. McFarlan^j^yrjJi^^^'gilnp^lt^ ji^jdaen
r rim liBTwljtt 1 1 in turn had been prepared by Ghorbanifar. That
col lectUi^i^g^tKti^lS^llt0Sat^^l^^^tSarjaJ&k!£w^
August of 1985; is that correct?
A I was not awai
Q In late August 1985 the National Security Council
appears to have imposed certain responsibilities on Colonel
North with regard to the American hostages in Iran and among
other things had issued or ordered issued to Colonel North an
alias passport in the name of Willieun P. Goode. Did you have
any knowledge of Colonel North's involvement in matters
relating to the American hostages in Lebanon in late August
of 1985?
UNCtfflFIED
285
. ^ 49
A Not in that context, but only in the fact that as
essentially the NSC staffer responsible for coordinating
counterterrorist activities he was exceedingly active in the
area of the American hostages in Lebanon. He indicated that,
but at that point I was not aware he had an alias passport.
Q Let me come at it another way. You had mentioned
to us in your interview and in other contexts that the first
assignment you received from Colonel North relating to these
matters ddC^ui^lHP on or about September 9, 1985; do you
recollect that?
A I recollect it. That is correct.
Q Do you have a present recollection of any
assignments that you would ha^Vv reti^ved Ji^l^nL Aiel No^h
reiatif^ ^^^ttM Ibnerican hostages in Lebanon prior to
September 9, 1985?
" A ■^' B* ^Si^l^HBblflBll^rom time to time on the
Iranian involv^||Bnt in the holding of American hostages in
Lebanon and assessment of captors involved. But the tasking
was sporadj
286
DC
50
D^M Eh
■i
\OTAl-
287
Q Let me drop back and kind of come at it this way.
tiCtJtSStFlEO
288
uHcussra
52
The September 9 date, what is it that jogs your recollection
that that's when Colonel North got in ^6tieh with you? Why is
the September 9 date one you can pick out with that kind of
definition? ~
A Well, because he called in the morning on secure.
He spoke with some excitement and stated that it was
imperative that the intelligence community be tasked with
increasing collection immediately on Iran and Lebanon, that
he could not provide details but that he anticipated an early
hostage release from Lebanon, perhaps involving William
Buckley. He provided a name, quite garbled, but with the
research of a Directorate of Intelligence analyst I was able
to identify the
I provided that information
began the
tasking. It is my understanding ttit
[does not recall that conversation and that tasking,
and I've been over that witf
several times. They do not dispute necessarily my
version. They apparently have no written records at the time
of the tasking.
Q You are putting your finger on one of the things
that puzzles me. Do you have a written record, a
contemporaneous written record of Colonel North getting in
icj
289
UNEUSSiku
53
touch with you on the morning of September 9?
A No, I did not because of the extreme sensitivity.
I felt it behooved me not to put that in writing at the time.
Q Mr. Allen, I've got high regard for your memory,
but there must be something else that you are holding onto
that ties your memory into that date of September 9. what is
it that helps you feel certain?
A Because, as I said, we researched the nane'^^^^H
The Directorate of
Intelligence analyst assisted me in that effort and her name
I recall going through this effort in
order to perform the
^^^^^ >lonel North called me back more than once that
weekr
It was only on the evening of the 13th of
September we saw^^^^^^^HB^H
things very distinctly and that call from Colonel North I
recall with exceptional clarity.
Q Believe me, I'm not disputing that with you, but
do you have or have you seen a piece of paper, a document, a
writing, a tangible item with the date September 9 on it
which you use to bolster your recollection?
A I do not have that.
Q Moreover, Director Casey also remembered September
Is I
82-688 0-88-11
290
QHsy^^i^
54
9 with some -clarity with regard to testimony that he was
going to give in December of 1986. Anything that you can
think of that would have that magic date on it that would
help us focus in on that?
A Well, the Independent Counsel has my files. It's
possible that the research that was done on the individual's
name might well be in that file because the analyst prepared
a little brief summary of what we )cnew about the individual,
and the information we had on him. But I
don't have my file, so I cannot go back and research it.
Q Well, I'm not going to beat this horse much
further, but you may recall that on October 7, 1985, you
prepared a memorandum foi
lin which you recited the history of your
involvement in the Iran initiative]
Do you recollect that memo?
A ^^^^^1 yes. I don't recall that date, but I assume
it was in —
Q I'm going to show you the memo in a minute, ,but
the reason I want you to focus on the memo is that it talks
about September 12 as the date that you were contacted by
Colonel North as opposed to 'tPrtflatTTg ff pirjtff h ttaflfirtBT^It ^*
-fi^Mm sew-
t^t iiiiwl rp~illil iHnfTiTiri T MJff IIT^ laars aitei something
that had September 9 written on it, which changed your
recollection. Is that possible? Anything's possible. Do
mnrnw
291
\imsmi
55
you recall such an event taking place?
A No, I don't. It's my view that the call occurred
about the 9th of September, on or about.
Q Let me show you the October 7, 1985, memorandum
which appears to be signed by you that went via
^^^^^H whose name I probably am mispronouncing.
A No, that's excellent.
Q To^^^^^^H That will be Exhibit 7.
A I reca]
A I recall that memorandum.
MS. MC GINN: Can I see that for a moment?
MR. KERR: Sure.
THE WITNESS: Clearly there is a discrepancy
between my recollection of the 9th and my written statement
of the 12th.
BY MR. KERR: (Resuming)
Q Yes, sir, and that may not amount to a tinker's
damn ~ you'll pardon the expression ~ but I'd like to know
what it is that causes the discrepancy, what it is that
causes you to be fixed on September 7 when this earlier
memorandum — excuse me, September 9, when this earlier
memorandum has you mentioning September 12.
U
292
UNEl^SMO
56
A Only that I recall that it was three or four days
before^^^^^^^^^^^^^^^^^^H that we to
research in the meantime, and that Colonel North called back
two or three times]
And he is a rather impatient individual and I
explained to him that the world didn't work that way, that we
couldn't manufacture it, that ^^^^^^^^^^^^^^^^^^^H we
wee* worl&Lng^ Very hard to do so.
2 th,
aiid
»cy of three days.
MS. MC GINN: May I just ask you, Mr. Kerr,
whether you got this from ^^ ^^^^^Qj^^^^l We're trying
to write down a file to identify it for our records. ,
-"-i_,M%^gRR: We got it from the Senate Intelligence
Committee. My unders^B^i^^is ^h<t^gjate Intelligence
Committee got it from the Central Intelligence Agency.
MS. MC GINN: We're just perplexed because there
are none of the usual identifying numbers on this which would
help us to identify J^plKCk it^^^-fili^^jjr^r. ^, St
MR. KERR: Moreover, while we are talking about
files, I would very much appreciate getting a copy of that
document that has not been expurgated. I am sure Mr. Allen
wrote it without those black splotches on it. I would like
to receivtfltt^ iii ^*^ lMlj|fciL<yWh<B^^gBdi<^iei6M
MS. HUGHES: If we can i(^g3gi.fyjsi^l>ack in our
iww«r
293
DNCkASSn
57
files, we'll see what we can do.
MR. KERR: knov^^^^^^^^^^^^B had
as I glanced over his shoulder, that vary document in an
unsplotched format.
To assist my brother from the House, let me
identify what we hM^-on: J^h^ :
It has a Senate Select
Committee identification — this is the Senate Select
Committee on Secret Military Assistance to Iran, et cetera —
of 1-0644 through 0646. And I believe it^b*«^^_ executi^ye
rjpgistrj^ n^|^eE_«f ^^k&^^^^em^ t^yj^^^y^n •rror.
Th« mtmitm^SH^^^']^^ th*Vl^ nui^^ orl3^aXT-9^ r^
I'm sur« any nOTBtfTToT otiB|||^iBOt>er*TBHr*-"«wi^i*<i to this
document at the time.
BY MR. KERR: (Resuming)
Q But in terms of a quest for a piece of paper that
has the date September 9 on it, this doesn't assist us and
you can't tell me any other document that I could look at
that would tell me what happened on September 9?
A When the Independent Counsel returns my files I
will certainly research that question.
MR. KERR:^ Mvsuggestion would be that we break
for lunch in light of the 12:00 suggestio^^nd return at
1:00.
MR. VAN CLEVE: I think I may be a few minutes
late, but you all pu^ht to go ahead.
mmwB
294
UNClMS'tRED
58
(Whereupon, at 11:58 a.m., the taking of the
instant deposition recessed, to reconven«^jit 1:00 p.m. the
same' day . i ^.^s, . -^
295
UNIMSSMD
59
AFTERNOON SESSION
(1:08 p.m.)
Whereupon ,
CHARLES E. ALLEN,
having been previously duly sworn by the Notary Public, was
further examined and testified as follows:
EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE - Resume
BY MR. KERR: (Resuming)
Q Mr. Allen, let me sort of pick up where we left
off with regard to the Israeli shipment of 100 TOW missiles
which occurred August 30 or thereabouts 1985. You did or did
not have contemporaneous knowledge of that shipment?
A None.
Q We understand that there were some reports in the
Operations Directorate in September about that shipment,
related to that shipment. Can you tell me when you became
aware of the fact that the Israelis had shipped 100 TOWs on
or about 30 August?
A I think the specific number of 100 I only knew
about when we were putting together the chronology after the
25th of November 1986. I knew that there had been some cable
traffic in October '85 becaus*^^^^^^^^^^^^
— had
commented about some unusual activity. He did not have any
particulars, but he knew that there had been an emergency
296
iiN<i^sn
60
landing of an aircraft in Tel Aviv on 15 September 1985.
He asked what I )cnew about it, and I did not give
him a direct response.
Q Did you have knowledge of it at that point?
A I did not have knowledge of the 100 TOWs, no.
Q But you had knowledge of the flight?
A I had knowledge that a flight had made an
emergency landing in Tel Aviv on the 15th of September 1985
from press
Q To help me along, at the time that North first
talked to you in early September, the 12th or the 9th, he did
not apprise you of the fact that a shipment of TOWs had been
mads by Israel to Iran; is that correct?
A That's correct.
Q Hfcjawi* Wp^»-aJ^^^^^jjip^r^^L9P you had with
Kovttij, J^R^^a by pmltg^one ri^ ^at ^rz
A
^«
recollection of what was said in that telephone conversation?
A I can paraphrase what he said. Essentially, he
said that there was a veiry sensitive initiative under way
relating to the American hostages in Lebanon, that there was
bcKE
297
a good potential that a hostage or more than one hostage
would be released in the coining days, that this information
had to be handled on a very strict need-to-know basis, that
he would not wish me to discuss it beyond i9i'e ^rec«or or the
Deputy Director.
He indicated that an individual in the Iranian
government holding a senior position]
had a garbled name
that, as I have stated previously, that I researched with the
aid of an analyst in the Directorate of Intelligence. We had
a small amount of information on this individual]
Q You got^^^^^^^^^^^^^^^^H from North as well as
the garbled name? "^
A .^^feds in the negative.
Q No . Okay .
was the essence. He did not explain any other aspect of this
initiative, provided no background whatsoever, emphasized
strongly the security aspects.
Q Elaborate for me a bit on how you all determined
298
UIWkASSIHED
A Well, the name was — he said that thi»^indiv.idual
hanl rfKo^^^^^^^^^^^^^^^^H And he
knew, except that the man had been involved, he thought, in
terrorist operations. Could we find some information on this
individual!
W^K, stt»T~ some "r«Bfe*Sff^5y"'^Sfi" anS^^t , she came
to me with just a couple of sentences on who this individual
was. There was an individual namedl
way of a name
Mr. North provided
Q Tfia«»i?ixaipl^i^ ^ma
trace through the CIA's own 201 files?
A She did both a trace in the overt files, as we
call them, on the Directorate of Intelligence side, and she
also ran a trace, as I recall, through the Directorate of
Operations.
Q Again, so that I am perfectly clear, the only name
that^cu ^^ S^Ru^gy^jft that point was what you ultimately
determined to be^^^^HH is that right? You had not been
given the name of any other persons!
A That's absolutely correct.
Q When and under what circmnstances did your focus
broaden beyondl
IraouniLO
299
UNCbASSra
63
When we obtained on the 13th of September 1985 the
The name Ascari
Now let me pursue. You got that on the 13tr
What efforts, if any, did you make to
determine the identity of Ascari at that point?
A We tried for several hours on the night of the
13th and the 14th. Colonel North asked us to research the
name. He said he didn't know who this individual was. Could
we research it? I called in a biographic analyst, who found
a couple of names in Iran that were possibly identical, and I
provided that information to Colonel North, but I was not
confident that this was the case. It seemed like this was
another individual or at the time we,]
Isaid that given the fact we can't identify
this individual it may not be a true name.
Q In the course of the search you all made on the
13th and 14th did you hit, so to speak, on Ghorbanifar's name
in the course of that search?
A No.
Q Do you know whether or not a request was actually
made to the Operations Directorate to search its files for
this individual Ascari?
I!
I^m
300
UNCiASsra
^* «^ I irri I i in W %mitj^\ recollecld^an of you or people
working for you getting in touch with eithei^^^^^^Hor^^H
Ion this aspect of things?
A No, I don't.
Q Just pursuing why that is so, again within this
mode of extreme discretion was that what was preventing you
from calling up the folks in the Near East Division or what?
A I believe that security was very much a
consideration. However, I can't recall. The analysts ^^ay
we^r^B^^ aska^BKIHKirch of the DO files. I don't know.
That MUftjfthe only name we had.
Q Let's talk about what the CIA has access to. The
name Ascari appears repeatedly in the Ghorbanifar 201 file.
It is something that he's used for quite some time. I would
have thought that had you J0^^ft(BM|^^^V™^ Ascari the CIA's
filing system wdiQ?<L j^JKp^ii'iBi 'Ji'^ ^M^M^^s a possible
identity. If it didn't happen, I'm curious as to why it
didn't happen. Is the f 1 1 iniy ■ri^M_"';JiLlMto"ILA*'CLrj' 'i °^
what?
A I can't answer that.
Q You can't answer that. In terms of who did a
search on the name, who actually did that for you?
A I don't recall the analyst's name.
301
MklttP
65
Q Did you have more than one analyst working for you
at that time?
A Conducting the research on this name?
Q Yes.
A One or two did the research.
Q Can you give me the universe of possible analysts
that would have been working for you at that time?
A I can't at this stage. I do not recall their
names. I do know that I recall asking the DDI analyst on
Iran,|B^^^^| to research that name and she was unable to
shed any light on the individual's identity.
f il< ~
^^ list, among other things, of the various
passports that Mr. Ghorbanifar had used going back to 1982
and that Ascari and several other names, like Krai is and
several other others, showed up in that file?
A I recall that that was an alias used, yes.
Q But you were left with the distinct impression at
the time North called you in early September that he himself
did not know the identity of Ascari; is that correct?
A He stated he did not know who Ascari was. That's
mm
302
uNeussn
66
the reason he asked me to do the research.
Q I understand. In that period of time, September
9-13, at the outset ware th«r»~ iy>y otta^r tasks given to you
by Colonel NoiAhl
*^" "^^ Relatin«^S» Iran'ti^^,^..
Q Yes, I'm sorry.
A Not to my knowledge.
Q Let wk_ nhew yc
A
^.
A Nine to 13 September?
Q Yes.
A Okay, thank you.
Q In September, let's go at it that way, did there
come a time when your tasks were broadened, your assignment
became greater than simply trying to collectl
Iwith regard to the Iranian situation?
A I can't r^All anaaj»g*<ij'fA^jt*^y^pi^^<iPP'^ know
that there might not have been something relating to Iranian
terrorism at that time which I was tasked by the NSC and by
other people on Iranian terrorism throughout the two years
I've served as the National Intelligence Officer, but I can't
recall anything specific.
Q Let me give you a more specific focus. Do you
recall in this period of time, certainly by the 18th of
303
UNCI^SMl)
67
September, being told by North of a possible arms deal
between Iran and international arms dealers]
»nd a request that you find out
as much as you could about such a deal?
A I recall that on the 26th of September 1985 there
wa s ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^H^^^^H
conducting a seminar at an offsite facility of the Agency and
Colonel North called me and asked why I was down there doing
that. And I said because I have other r«SB^8ibilities, but
that ' if anecdotal .
He asked me to look into ^^^^^^^^^^
and he said
this has nothing to do with what we are doing, what really is
going on.
Q We'll come to that in another way, but let me show
you a memorandum dated September 19, 1985, which appears to
be from you to Colonel North, which has attached to it a
memorandum dated September 18,1985 fron^^^^^^^Hof ^^H
lin the Intelligence Directorate. For
reference purposes, it's Senate Select Committee document N-
6224 through 6246. If you would mark that as Exhibit 8.
(The document referred to was
marked Allen Exhibit Number 8
for identification.)
mmwB
304
mumm
68
Mr. Allen, if you would take a moment to glance
through that document, I'd liki^eu^ f iraa fejfetell me whether
it's your memo eid then we'll se» T^'it refreshes your
recollection on assignments you had gotten from Colonel North
on the transaction that seems to be referred to there.
(Pause. )
A You have questions on this?
Q Is that your memo, first of all?
~ A^feThat's
meworandum^
% «f ■ ■
Colonel North, correct?
A Yes, I did.
QnL
p,0tlihtiat
:erial to
gov^miSnt or
for Co^lgaiil HgjrJJu=X'
A I'm not certain I was checking into it for Colonel
North because it doesn't say that. It says it was my request
to the CIA's Directorate of Intelligence for any impending
arms negotiations between Tehran and possible international
arms dealers. Conceivably this could have been a request
from Colonel North, although I may have initiated this on my
ownl
305
uNaASSiBtn
69
Q The reason I'm asking you to look at it is, you
see, I'm trying to get, stir a recollection on the breadth of
the assignments that you would have had in the first two
weeks of September 1985. It appears to me that however it
happened you had some interest in arms transactions in
Tehran, and I'm trying to get a sense of why it was that you
had that interest and what you were looking for.
A Well, the interest was precipitatec
labout arms deals between I
and the Iranian
government
I may have actually done this on my own to try to
discern what was occurring on the international arms market
and then routed this tOiXaasBiR„NMitt||^^^^^M^e«r£ain iSfi
on the 26th of
September — ■^■BS^^^B^^^HHi^^H^Hi but I think it was
the 26th of September — where he called me offsite on secure
sa id^^Q^HH^^^H^^^^^^^^^H^^^^fH
HH^^H^^^^^^^^^^^^^B^^flj^fl^^^HB^^^^^^^n He
find out what this means because this does not concern any
initiative that we have under way. And I said I would do
that.
But I don't know that he requested this.
I!
^JiJh «L?
306
utttussra
70
Q And you have no additional recollection of North
telling you about a potential arms transaction of which he
had heard as of September 19?
A I don't know. I don't recall.
Q As you are aware, at the present time, on
September 14, 1985, Israel shipped an additional 400 TOWs.
We talked bria^y 'about the airplane. You were aware — I
take it you are telling me that you were aware from cable
traffic and the like in October that there had been — you
were not aware in October? "^_,j£^^^-- ^' ^' '
^ A^ I want to correct what vou said. I was aware that
raised in the context of a discussion with
me — and I do not recall why he raised it — but he
Indicated that there had been an aircraft into Tel Aviv with
an emergency, that made an emergency landing, and which
received international press attention. This aircraft
allegedly had come out of Tabriz, declared an emergency over
Turkey and landed at Tel Aviv.
He said he was unable to obtain any information
about it and I told him — at that stage I told him nothing.
I just listened to what he had to say.
Q Had you reacted to what he said, what would you
have known at that point is really what I'm trying to find
out. What familiarity did you yourself have?
'"^mm
307
s
71
A All I would have )cnown would be the activity that
occurred over the weekend of 13 to 15 September; the release
of Reverend Wei
That would have been
all I could have told him. I could not have told him any
further details, I don't believe. .^afe--'-' "
con were
not being^».vM"^lfomat4^ by Colonel North at all on what
was transpiring; is that a correct assessment?
one cduld suxni^gfitftt- aJm^^^^a^l^ons^K sene--tiature were
involve
Inte^ig*
cables out of
relating to the aircraft traveling on September 18 and 19
that we have just been alluding to. Were you reading that
cable traffic?
Q During that same period of time, mid-September
1985, again according to the CIA's memorandum of the events
of September, the Israeli censors killed a story that there
UNftASSfRED
308
DHSlkS^^
had been a flight into Tehran based on a meeting of David
Kimche and Bud McFarlane. Again, as to what you knew, were
you aware that there had been that effort by the Israeli
censors to block publication of this?
A No, I was not aware.
Q So in terns of what you yourself were receiving,
you were receiving^^^^^^^^^^^^^^Hjj^H is
A On this initiative I was receiving that.
Q In terms of the Operations Directorate cable
traffic that would be coming out <3'^^^^^^^^H ^^^^ ESist
ind the like, you would not have been tied into
that; is that correct?
A Not unless they disseminated the intelligence as
what they called telegraphic dissemination.
--rAr^'-'^^tlf^ *jB^ ^y again what I'm trying to get a sense
of. You ^'*<''8^^^^H^H^M|^Bs@iH^B|i^^§£^® operations
Directorate loop on cjiiil*' tragic coming out of the Middle -r
A '^NoT
Q Yes, that is correct?
A Yes, that is correct. I would not want to
mislead. From time to time there might have been^^g^sable
showed me on something on terrorism of an operational nature,
but I was not regularly reading the operational traffic.
Q With regard to standard or traditional roles for
309
UNCussn
73
CIA personnel, was what you were being asked to do for
Colonel North '
was that within the ambitT^
of your standard or traditional duties or was this an unusual
kind of task to have assigned to you as an NIO?
A It was probably unusual. It fell within the
purview of Caskin^^ The National Intelligence Officers
regularly develop r«
this
was a more intensified, selective type of requirement, and it
was unusual to a certain extent.
Q Well, forgive perhaps my not really understanding
the roles of the various directorates, but I would have
thought that what you were gathering was the kind of thing
that either the folks in the Directorate of Intelligence or,
more likely, the Operations Directorate, would in the
traditional assignment of roles have been responsible for. I
would have thought that the NIO would be more into the
TDi
310
UHtkl^W
74
business of making analyses than collecting raw data.
A He does estimates, but he also sets priorities.
He coordinates intelligence community activities relating to
counterterrorism. That's under the Vice President's Task
Force on Combatting Terrorism. I suggest you read the
responsibilities given the NIO for Counterterrorism.
Counterterrorism tends to be an operationally
oriented type activity. There are certain long-range
estimative aspects^^^^ ^Hr^^F i^ls noiii£ai^- l^e'^tf^toiptor
of CentjaK I^liilJsisgpihg when I advised him of what I was
doing personally on the 16th of Septemlser, directed that I
continue to work with Colonel North on this activity and on
this ^latection effort.
I also discussed it in detail over the entire
He and I conversed many times. We met
persone(RfB« tiOBber of times.
Q Let's pursue that. During the period September 13
until you met with Casey on September 16, had you alerted
anyone in the Operations Directorate — Mr. George or any of
his subordinates — that you were taking on this role?
A No.
Q Had not?
A If you will recall, I testified a few minutes ago
ijilEi
311
; .*>, f^ f^ ' '
fFtlsU
75
that Colonel North asked that I restrict this to the Director
and Deputy Director, which I did.
Q Well, did you call the Director or the Deputy
Director between the 9th, by your date, and the 16th?
A I talked to the Director of Central Intelligence
on the 13th by secure telephone and discussed]
lover secure telephone.
Q So the first conversation you had with the
Director about this assignment you received from Colonel
North would have been on the 13th|
is that correct?
A That's correct.
Q As to whether or not the assignment was one that
the Director approve^ youjdid not seek that approval from
the Director at the time the assignment was made; is that
right?
A That's correct. Would you repeat the question?
There was an inference there I did not care for.
Q You did not seek the authorization of the Director
or his Deputy to carry out the task given to you by Colonel
North at the time the task was initially given to you; is
that right?
A That's correct. I had similarly taskedf^fin
other circumstances. In my view, it fell within the tasking
and coordination role of the National Intelligence Officer
mmsm
312
Hi
76
for Counterterrorism. I have yet to find anyone dispute
that.
Q Well, don't despair. It may happen before it's
all over.
A Well, you can challenge it if you want to.
Q with regard to when you did advise Casey of this
assignment, it would have been on the 13th|
is that right?
A That's correct.
Q Now what did you tell Casey about why you were
[at that time?
A I told him at the request of Colonel Oliver L.
North I was
Director li ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
that he
wished for me to stay in touch vS^||£im oii.^mppopm4|
He^affd not sa«a IBPtae quite aware of what the
initiative that Colonel North was pursuing and, as I recall,
'•'T^ht'-htfiWBff^BFTMni'FT^tlfl' i "n . he stated it might relate to
from anyone as to why this- a^Lgnmaiit^ «af_ne»^£ven to tlte'
Opezratiofis Dizl^^rate or tKe 4Rt«llig«nce Directorate «f^he
UNKI^IFIEO
313
77
CIA? 7jj~j; -lll-s. ' ^-_ ' ^5t _.
A M6y"-a0h* t you ask the question again., because I
don't understand it.
Q Could you read it back?
"^ THE REPORTER: Question: "As of that time had you
received any explanation from anyone as to why this
assignment was not given to the Operations Directorate or the
Intelligence Directorate of tW«i^8^|i?*^ -—_ "i^ -^
THE WITNESS: As of that time Colonel North had
come to me. He stated because as ^^fe"giljirai IfflSSlligence
Officer I could task agencies of the intelligence community,
not just CIA, ar^ he believ^' th^^^ was tWi, intitiatMUal who-^
couXid coo^iiSti^^l^fc^a^ivfl^y . ^K one «l8e of fared ^ny
views one way ofcth* bth«i^ lb:. MeMahon and'%r.'^"OMcyB^9K
that weekend, and they expressed
13-16 September. ThereH^^^H
ivailable to the Director of Operations,
Mr. Gaorge, as I refi&ll.
BY MR. KERR: (Resuming)
Q All right. Let me pursue that. I was not aware
of that. Mr. George would have been receivli
that began on the 13th of September'^
A He was receiving to read and return to the
Director the copy that came. We were getting it in one copy,
314
vmmm
78
hard copy. Electronic dissemination was not feasible. If
you try to disseminate it electronically and ask for one
electronic copy the computer system will produce 32. I can
assure you that is a fact.
Q I believe aaything afagu^a cos^^er.
^ So_l uifdlfeatJSd/'^tili thajStttaet Trith regard to ^
receiving^^^^^^^ByowF^^^^bac^oaj^^^^lttpet^^air George
was mad«j^g^^ ^^^^^^^^^^^^^B^^^^^ ^°^^^^^ ^* ^
A I )uiow he saw ^^^^^^Vthat were received on the
13-16 September.
Q How do you know that?
A Because they were taken to him.
Q By whom?
A I believe in some cases I made certain he saw
other cases ,^^^^^^^^^^^^^^^^H who,
out of steam and couldn't stay awake any longer, substituted
for me. But I recall numerous times walking into Mr.
George's office and showing himl
Q And this would be numerous times in the period
September 13 through 16? ^^ ~ sa^^fct -^
A No. I'm speaking in the succeeding months.
Q Let's stay in September.
A Well, I just want to make sure. I don't know the
number of times that one walked down to see Clair George
between the 13th and 16th.
|ol
315
mmm
79
Q On any of those occasions between the 13th and
16th, when you walked down to Mr. George's office did you
discuss with Mr. George why it was you were collecting this
material?
A I don't recall that.
Q You just kind of came in and plunked it on his
desk?
A Let me correct the record. I explained to him
that this was '^^^^^^
[at the request of Colonel North. I
gave him that background at the outset.
Q All right. Pursuing that, when you goti
ind you hand-carried them down to Mr. George's
desk, you Vould not have discussed with Mr. George what
[about and what they might imply?
A I don't recall the specific conversations, but I'm
certain there was some conversation as to the substance
Q I would assuae ^^t MP%he ordinary course you
receive your assignments from someone other than Lieutenant
Colonels on the National Security Council staff, isn't that
right?
A I receive requests from a variety of people. I
receive requests from senior officials of various departments
and agencies, from the Director of Central Intelligence, the
■ B <iK«%i- lid iik^ 1.1
316
iiNfiiA&$ra
80
Deputy Director of Central Intelligence, and especially the
Chairman of the National Intelligence Council.
Q Well, help me out. The National Intelligence
Council is the organ that you are a part of. There is
Chairman and Vice Chairman of that body, is there not?
A There is a Chairman and a vice Chairman.
Q In terms of assignments being handed out to NIOs,
are the assignments given by the Chairman or the vice
Chairman or are they made in some other fashion?
A No, the taslcing^^y come directly, say, from
Ambassador Bremmer, Director of the Office of Combatting
Terrorism. I normally inform the Chairman and vice Chairman
of the task. I just did an estimate on the insurgency and
counterinsurg«ncy^^^^^^^^^ft The tasking came from
Ambassador Bremm^^F ^ _,
Q Is there and was there in 1985 a policy or program
for clearing assignments that came, for example, from the
White House by way of the NSC?
A No. I obtained numerous requests from the NSC.
We normally kept Mr. Gates, the Chairman, involved on
anything that was at all significant. Any type of
substantive analytical assessments one would certainly as a
part of our normal meetings with Mr. Gates, we would inform
Mr. Gates of this.
Q But again so I understand, you felt it was
|e(j
317
wmmm
81
perfectly within the standard operating procedure of the
National —
A I report to the Director of Central Intelligence.
I don't report to the Chairman of the National Intelligence
Council. The National Intelligence Council chairman acts as
a dean of the faculty. He clearly has certain authorities
over us, but we act as the faculty for the Director of
Central Intelligence. So I feel that on cases of tasking at
the national level from the White House it was perfectly
feasible for me to take that tasking and to inform the
Director of Central Intelligence.
The Director of Central Intelligence is my boss
and if he saw anything wrong with the tasking he would have
told me at the outset. Mr. Casey is not a man to mince
words .
Q So I can follow the lines of authority here, you
got a call from Colonel North on either the 9th or the 12th
of September asking you tc
land you did not check on
whether or not you could do that with anybody until after
Ls that right?
A I don't it^^^^H^^^^^^^^Hl He asked
ni^o try to^^^^^^^^^^^^^^H^^^^^^^^^^^^^^^Hand
deC^Ti^En^
318
UNStMi
I felt that this was an appropriate request from
the NSC. This was an appropriate task which I discussed with
and on the 13th I explained to Mr. Casey what I was
doing. He saw no problem with my performance from the 9th
through the 13th of September.
Q In terms of|
that was something that you initiated, isn't
that right? You're the one that^^^^^^^^^^^^Hsaid do
it; isn't that correct?
A I
Q And at the time you did that you did that only on
the authority of Colonel North; is that correct?
A I did it on my authority.
Q At the request of Colonel North.
A At the request of Colonel North.
Q And you cleared it with no one else in the Central
Intelligence Agency?
A That's correct. I didn't have^^^^^^^H to
clear the Once had^^^^^^^^^^Hlthen
discussed it with Mr. Casey at some length on the secure
telephone. And I believe I talked to him more than once on
319
um^ssiEra
83
the secure telephone that weekend — he was in New York — as
came in, and I also discussed with him
when Mr. Weir was released on Sunday morning the I5th of
September. It all seemed very pro foma to me.
Q Was it your belief and understanding as of mid-
September, the 13th through the 16th, that Mr. Buckley was
still alive?
Of September? No. It was my belief that he was
dea.
MR. KERR: Thank you.
(A brief recess was taken.)
BY MR. KERR: (Resuming)
Q At the time we broke, Mr. Allen, you indicated in
September 13 to 16, 1985 it was your belief that Mr. Buckley
was dead; is that correct?
was my belie f^^^^^^^^^^^^^^^^^^f We
no conclusive proof that he was dead.
Q with regard to the hostages in Lebanon, you had in
fact, as of September 13 to 16, been working closely with
Colonel North as to location of the hostages and efforts to
get them out by way of ransom money; isn't that correct?
320
uNeymED
84
A That is not correct.
Q Do you have a recollection, sir, of working in the
summer, spring-summer-fall of 1985 with agents of DEA for the
purpose of working with them to ransom hostages in Lebanon?
A I don't have any recollection of meeting with any
DEA agents in that time frame, and that specific time frame,
to the best of my )tnowledge and recollection I did not meet
with any DEA agents relating to hostages in Lebanon.
You must remember I was the National Intelligence
Officer for Narcotics. I met with a lot of DEA officers, but
not on hostages.
Q Do you recall meeting with any DEA officer,
official, representative in the period between May and
September 1985 for the purpose of discussing with them an
arrangement to ransom American hostages in Lebanon?
A I do not recall.
Q Do you know a DEA agent representative by the name
A I have me^^^^^^^^^^^H but only and based on my
recollections I met him only after I was named Director of
the Interagency DCI Hostage Location Task Force in late
December 1985.
Q You do not recall meeting with him in the period
May through September 1985 with regard to a plan in
conjunction with Colonel North to ransom hostages for several
321
UNCI^SiFe
85
hundreds of thousands of dollars in Lebanon?
A I can't recall that, no.
Q Did you ever become aware at any time of any plan
in which Colonel North participated with representatives of
DEA to ransom hostages in Lebanon
A I was aware that Colonel North had two DEA agents
apparently seconded to him from that agency with the approval
of the Director of that agency, but I don't recall exactly
when I became aware of it.
Q What were the names of those agents?
A One waa^^^^^^^^^H and you clearly know the name
of the other. If you will refresh my memory I would be
grateful.
Q
A ^^^^^^
Q Do you recall meeting witl^^^^^^^^^Bat his home
or at yours to discuss matters relating to hostages?
A After I became Director of the DCI Task Force they
both came to my home one evening to discuss their contacts
and initiatives relating to freeing the hostages in Lebanon.
Q And that would have been approximately^J^jp^^n.^- 1
/85,^^rly
b«ai|tes the two of
^?Lny
82-688 0-88-12
322
UNfiMHIO
86
you, the two of them and yourself, at that meeting?
A My wife and daughter, but they werenft in the same
room.
Q
A
Q
such me*
—A
Were any notes or memoranda made of that meeting?
No, not that I recall. "^^^
And it's your recollection that you only had one
At my home. I believe that they were introduced
to the operations subgroup of the TWIG or its predecessor in
about the December '85 time frame, because I recall they
appeared at Colonel North's request at a meeting in the White
House situation room.
Q And that would have been when?
A Around December '85, where we talked about the
location of the American hostages in Lebanon, their
condition.
Q At the time that these two gentlemen met with you
at your home did they relate to you their activities with
Colonel North in the summer of 1985 in an endeavor to rescue
the hostages?
A I don't think they went into any specific
operation. They spoke about, as DEA agents, DEA has
ind that they had some contacts ^^^^
[back into Lebanon.
MR. LIMAM: Could I ask a question?
323
wmm
MR. KERR: Sure.
MR. LIMAN: Did you ever learn of a plan to use
DEA agents to pay ransom to ere^.^atck the hostages?
THE WITNESS: Did I ever learn of it?
MR. LIMAN: Yes, sir.
THE WITNESS: At any time during this whole
episode? _^^
MR. LIMAN: At any tiwr means ever.
THE WITNESS: I don't recall ever being told
directly by either the agents or by Colonel North that such
an initiative was under way where ransom would be paid for
the securing of the release of the hostages. I do recall
that the DEA agents were to be used to try to track down the
location of the American hostages.
MR. LIMAN: Did you ever learn of any plan — I
mean ever, ever learn of any plan — to use DEA agents to pay
money to get back the hostages?
THE WITNESS: A specific plan at a specific time?
MR. LIMAN: Any idea. Was that ever discussed
with you that DEA agents were being used in an effort to get
back the hostages by paying money?
THE WITNESS: By paying money, not in the 1985-
1986 time frame.
MR. LIMAN: Did you hear of it earlier?
THE WITNESS: I recall when I was working on an
scl
324
88
project in the Department of Defense where Colonel North one
evening in his office alluded to the fact that he was hopeful
of obtaining release of American hostages in Lebanon, and he
was dealing with a chap name<^^^^^^^^B-- a DEA officer —
and he mentioned some sums of money, but I do not recall any
specifics of that.
I was working on something totally different and
had little or no interest in hostages, counterterrorism or
anything relating to that.
MR. LIMAN: Roughly what period was that?
THE WITNESS: That would have been in the late
summer-early fall of 1984. That's the only thing I can
recall. I can't recall anything more specific.
MR. LIMAN: And that's the only time that you ever
heard of, heard any discussion about the possibility of
paying money to get the hostages back?
THE WITNESS: Specific information from Colonel
North or from the DEA agents?
MR. LIMAN: Anyone.
THE WITNESS: I can't recall specific information.
m«ana.dMfeMlMl^6^^Bpr yo" ever hear anyone discuss a
possibility of paying money through DEA agents to get the
hostages back other than that one incident you talked about
in the Department of Defense?
«Nwwe
325
wmmm
89
THE WITNESS: I don't recall any specific.
MR. LIMAN: Did you ever hear that Colonel North
had raised some money for paying to get the hostages back?
THE WITNESS: In the August 1986, Mr. Clarridge,
who was a member of the Operations Subgroup, and I attended a
meeting at the White House and Colonel North had told Mr.
Clarridge sometime during the meeting that there was an
effort under way by Mr. Perot to secure the release of
hostages in Lebanon through the use of private monies and
that Mr. Perot had sent some of his officers to Cyprus to try
to conclude such a deal.
MR. LIMAN: Did Colonel North say he was assisting
in this?
THE WITNESS: I did not discuss this with Colonel
North. I only discussed it with Mr. Clarridge.
MR. LIMAN: Did Mr. Clarridge tell you that
Colonel North had said he was assisting in this?
THE WITNESS: He didn't put it in those terms.
MR. LIMAN: What did he say about Colonel North's
role? ^^^ ^,,-
* ^^ THE WITNESS: He said Colonel North had told him
that Mr. Perot had sent officers to Cyprus with some private
funds to try to obtain the release of American hostages in
Lebanon. Mr. Clarridge and I speculated that this probably
wouldn't work.
326
\immm
90
MR. LIMAN: Did Mr. Clarridge mention to you that
DEA agents were involved in this effort?
THE WITNESS: No, sir.
MR. LIMAN: And when the DEA agents came to your
home, did they talk to you about the fact that they were
going to be spending money to try to get the hostages back?
THE WITNESS: Not in those specific terms that I
can recall.
MR. LIMAN: Did they talK aboul money at all?
THE WITNESS: I don't think so. I interviewed
them at the request of Colonel North in order to determine
what type of access that they had, who were they informants,
and what were their level of access within th^tebanese
society.
MR. LIMAN: Did they tell you that they were
paying informants?
THE WITNESS: Well, DEA officers pay informants
for information on narcotics.
MR. LIMAN: But this was not information on
narcotics, was it?
THE WITNESS: They stated they ha
But I did
327
iiHCUissffe
91
not find the leads that they had all that promising.
MR. LIMAN: Were they sent to you so that you
could evaluate whether they were likely to be successful?
THE WITNESS: Well, to evaluate, and then I had on
my hostage location task forc^^^^^^^^^^^^^^^^^^^^^^^^He
took a trip with one or both of these officers to vis
to discuss the value of these people and to evaluate
them.
It was more a valuation of their potential.
MR. LIMAN: Now was that trip paid for out of the
CIA budget?
THE WITNESS: Um-hum.
MR. LIMAN: Did you ever hear that the NSC was
using its own funds to finance this effort by the DEA agents?
THE WITNESS: I was never told what funds were
being used by these officers, what was the source of their
funds. No one ever indicated that to me.
MR. LIMAN: Did anyone say how much they were
spending?
THE WITNESS: No, sir.
THft.l«TNESS: No, sir.
MR. LIMAN: Did you discuss the DEA's role in
4 i3»' W ^ X fi^m'r^
328
92
attempting to locate the hostages with anyone at the CIA
other than Mr. Clarridge?
THE WITNESS :^^^^^^^^^^^^^^Hand I
Mr. Casey on the DEA initiative.
MR. LIMAN: And when did you brief him?
THE WITNESS: Well, that was after^^H
Ihad taken his trip, I believe.
MR. LIMAN: Tol
THE WITNESS: Yes, that was probably in late
winter.
MR. LIMAN: Of 1986?
THE WITNESS: Well, let us say in early spring at
the latest, 1986.
MR. LIMAN: And before that you didn't brief the
DCI?
THE WITNESS: I don't think there was anything
really to brief hin on.
MR. LIMAN: Did you brief anyone else in the CIA
hierarchy on this?
THE WITNESS: I don't think so.
MR. LIMAN: Did anyone ever tell you that there
was a Presidential Finding with respect to this DEA endeavor?
THE WITNESS: I never was aware of any
Presidential Finding.
MR. LIMAN: Did anyone ever tell you about any
329
mtmrn
93
discussions with the Attorney General about this venture?
THE WITNESS: Only in the sense that colonel
North, when he asked me to evaluate their potential, to take
a hard look, he indicated that^^^^^^Hhad agreed to assign
these two officers to the NSC for this purpose and that the
Attorney General was aware of it.
MR. LIMAN: Now what precisely did Colonel North
tell you before the DEA agents came to your home for a
discussion with you?
THE WITNESS: He just suggested that now that I
was director of the Hostage Location Task Force that they
might have information on their capabilities to provide
additional intelligence.
MR. LIMAN: And what did they tell you that they
were doing?
THE WITNESS: They simply told me about their
informants and that they felt that they had fairly good
access. My view of it and my assessment was that it was
probably worth pursuing further, but that these officers did
not have access to the real individuals that I wanted access
to. I wantec^^^^^^^
and these people did not have that
access.
MR. LIMAN: Was there any policy at that time that
you were aware of at the CIA with respect to paying money to
330
get the hostages back?
THE WITNESS: We had a policy of the U.S.
Government that we would not pay ransom for hostages, yes.
MR. LIMAN: What about paying bribes to their
captors?
THE WITNESS: Well, I don't know in what context
your question relates, because I don't have the specifics of
the event that you are referring to. But it is the
counterterrorist policy of the U.S. Government that we will
not negotiate nor will we ransom hostages from captors.
MR. LIMAN: Now when the agents came to your home
was it your understanding that they were talking about paying
money to get the hostages out?
THE WITNESS: No. They were simply going to
discuss with me their capabilities as far as access agents
that might have intelligence relating to — that might have
intelligence relating to the captors of the American hostages
in Lebanon.
MR. LIMAN: And suppose that they had information
that the hostages were being held by,1
^^^^^^^1 what would you have done with that?
THE WITNESS: Well, I think that would have been
something in which we would have been greatly interested. I
was not greatly interested in pursuing this specific
operational opportunity because I did not think that they had
331
95
the access that I was looking for.
MR. LIMAN: But I take it from what you're saying
that you did not understand that they themselves, the DEA,
was proposing to get the hostages back.
THE WITNESS: Who is "they"?
MR, LIMAN: The DEA.
THE WITNESS: You mear
MR. LIMAN: No, the DEA and its agents.
THE WITNESS: That'
MR. LIMAN: Well, he's only one person.
THE WITNESS: He is in charge.
MR. LIMAN: Right.
THE WITNESS: You are sayin^^^^^^H had approved
an operation to go after the agents?
MR. LIMAN: Did you understand that?
THE WITNESS: If that's what you're saying, I had
no knowledge of that.
MR. LIMAN: Did you have any knowledge from this
meeting that the DEA personnel with whom you were meeting had
proposed a plan for getting the hostages back?
THE WITNESS: A specific operation?
MR. LIMAN: A specific proposal.
THE WITNESS: No. Your inference of your question
is that they had a specific proposal relating to bribes, and
I don't know of any specific thing.
332
-— — 96
MR. LIMAM: What about a general proposal to get
the hostages back?
THE WITNESS: Well, that was the reason they were
seconded, as I understand it, to the NSC — to worlc on the
problem of trying to locate the hostages and to determine
their condition.
MR. L^g^smamm^t. oiAt to ^Kate the hostages?
THE WITNESS: Well, I never heard of any specific
rescue plan that was proposed by DEA agents.
MR. LIMAN: Did you ever hear of any general
concept that they had about getting the hostages back?
THE WITNESS: I have no detailed recollection that
they had a specific plan to get the hostages back once they
had located them.
^^^JSJI^MR. LIMAN: What about a general recollection of a
general concept to get the hostages back?
THE WITNESS: I don't have any general
recollection of a general plan to get the hostages back.
MR. LIMAN: Any concept?
THE WITNESS: They felt — let me state what my
impressions of these chaps were, is that they overestimated
their agents!
I never heard then talk about a specific
operational plan where they would in some way free them.
U
333
mmrn
97
The only thing that I do recall is that — and
it's been a long time since we had those discussions — is
that they felt that
MR. LIMAN: Would a proposal to pay money to the
persons holding the hostages have been inconsistent with
United States policy as you then understood it?
THE WITNESS: Restate that, please.
MR. LIMAN: Would -fiiau yiy^at thaAC*^" .^
THE REPORTER: Question: "Would a proposal to pay
money to the persons holding the hostages have been
inconsistent with United States policy as you then understood
it?"
THE WITNESS: Sure, if it was a proposal to pay
money directly to the captors. If it was a proposal to payH
that would be something
different.
MR. LIMAN: And did you hear of either proposal?
THE WITNESS: No specific plans. There was a
generic comment
MR. LIMAN: And who made that generic comment?
THE WITNESS: I thinW^'SbSl^f fliqjte -cr«ntUSnen did
Id
334
UlMSIHiD
-- and what was the other chap's name?
MR. LIMAN: Did they say what it would tak<
THE WITNESS: No.
MR. LIMAN: Did you ever discuss that with Colonel
North?
THE WITNESS: No.
MR. LIMAN: What did you tell Colonel North after
this meeting?
THE WITNESS: I told him I would send — I
believe, and I don't recall the precise dates or sequence —
send^^^^^^^^^^^^^^l to to some the
ind i V idua 1 s^^^^^^^^^^^^^^^^^^^^^H
MR. LIHAN: Anddi^^^^^^^^^^^^^ report
to you?
THE WITNESS: Yes.
MR. LIMAN: What did he tell you?
THE WITNESS: Well, he had mixed feelings about
the individuals and their potential.
MR. LIMAN: Did he ever write a report to you?
THE WITNESS: He wrote a memo at one time, and I
don't ]cnow where that memo is. Maybe you have it.
MR. KERR: Do you have any objection to my showing
this to the witness to refresh his recollection? He may have
his recollection refreshed.
1
335
\mm
99
BY MR. KERR: (Resuming)
Q Mr. Allen, let roe show you a memorandum dated the
7th of June, 1985, reference numbers in the Senate Select
Committee files at N-7419 through N-7431. I'd like you to
look at it and tell me first if you've ever seen it before.
But beyond that I'd like you to focus on the setting forth of
a DEA operation that begins on page two, and I'd like you to
read that with care and then tell me whether or not it
refreshes your recollection of knowledge that yai wt^^tf^va
had in 1985 of the operation being planned.
(Pause. )
A I don't know anything about that.
Q You don't know anything about it at all?
MR. LIMAN: Colonel North never told you about
this?
THE WITNESS: In June of '85?
KR. LIMAN: At any time.
THE WITNESS: If he did, I do not recall it. It
made no serious impact on my recollection.
MR. LIMAN: Isn't it the type of thing that if he
told you, you would have remembered paying this kind of money
to get the hostages back?
THE WITNESS: The only recollection I ever had
related to the summer of 1986, where direct — where private
funds allegedly were to be paid directly to free one or more
!lira!!F!R)
336
WyiSSIiKD
100
hostages, and that was the Ross Perot initiative. I don't
recall that initiative in 1985. ^^^ j:^-^
MR. LIMAN: Did Mr. Clarridge tell you whether he
thought it was a good idea for a private American citizen to
pay ransom to get the hostages back?
THE WITNESS: You mean from a policy perspective,
and you're talking about t^|e^l986 Ifisuli?^
MR. LIMAN: The Perot incident.
THE WITNESS: I think both of us had serious
reservations about that initiative.
MR. LIMAN: Was it the United States Government's
policy, as you understood it, not to pay money itself but to
encourage private citizens to pay money to get hostflfttfe )^k?
,_THE WITNESS: There is such a thing called ransom
insurance, sir, which corporations pay all the time —
Bechtel, you name it. We can't stop those kinds of private
ransom initiatives.
MR. LIMAN: Was it the policy of the government to
encourage the payment of ransom to get hostages back?
jr— THE WITNESS: It is the policy of the government
to discourage the payment of ransom and in fact, as part of
the Vice President's Task ^°^^^HHfe|^y:"<3 Terrorism
ransom insurance was an issue of continuing study because we
wished to discourage corporations from paying insurance
premiums in order to protect themselves from kidnappings of
I
I
337
uHCi^sra
101
their employees in certain field operations.
Mfti. L^yiM; When Mr. Clarridge told you about the
Perot incident in 1986, did he say that this was a bad idea?
THE WITNESS: I don't recall that we specifically
discussed the fact that this countervened U.S. policy as the
fact that we seriously doubted the effectiveness of it and
questioned the ability of the Ross Perot organization to
operationally succeed in something like that.
MR. LIMAN: Did he explain to you why this was
being discussed in the White House situation room?
THE WITNESS: No.
MR. LIMAN: Did he explain to you how the
participants in that meeting knew of Mr. Perot's plan?
THE WITNESS: You misquoted what I stated. I
stated that there was a meeting of the Operations Subgroup
and that Colonel North only and to the best of my knowledge
mentioned this to Mr. Clarridge, that he did not mention it
to other members of the Operations Subgroup.
MR. LIMAN: Did he tell you how Colonel North knew
of it?
THE WITNESS: No.
MR. LIMAN: Did he tell you that Colonel North was
in touch with Mr. Perot?
THE WITNESS: That was my understanding from what
Mr. Clarridge said.
338
UMtLASSD
102
'^^^^^^ik-. ' 'UlBES^^bitt^fwu ever get in touch with Mr.
Perot?
THE WITNESS: I have never met Mr. Perot and have
never spoken to him.
MR. LIMAM: Or any of his representatives?
THE WITNESS: Or any of his representatives. That
is a fact.
BY MR. KERR: (Resiuning)
tc|^^^^^^^^^^^^^^^H they
made a number of trips to Cyprus. What knowledge do you have
A I have no knowledge.
Q No knowledge?
A No.
Q And similarly you have no knowledge of Colonel
North's payment of those expenses out of funds that he had
access to; is that correct?- >»-=
A I have no knowledge of how the travel for those
individuals was paid.
Q Did you know that they were making trips to
Cyprus?
A I knew they were making trips to Europe and to
Cyprus .
Q And you came by that knowledge how?
that^^^^^^^^^^^^^^^^^^^ftnentioned
339
iiHeuss
-r^
It. Colonel North may have mentioned it
may have mentioned it. I don't recall. And I did not track
the activities of these individuals. They were what one
might say basically a separate channel of the NSC and not one
that concerned me. I was more concerned with collecting and
coordinating intelligence on what Mr. Ghorbanifar was doing.
Q You would not have dealt with them wearing your
narcotics hat either, I take it?
A Absolutely not.
Q Do you know a gentleman by the name of Ed liickey
at the White House?
A Yes.
Q How do you know Mr. Hickey?
A I first met Mr. Hickey in, I believe, 1981. X was
working on a compartmented classified project for Mr.
Carlucci and later Admiral Inman.
Q Is this the sane project you were working on with
Colonel North, or a different project?
A The same project.
Q And Mr. Hickey's relationship to Colonel North for
that project was what? Were they working together on this
project?
A Mr. Hickey was a very interested participant.
Q Was one working for the other or were they working
side by side, so to speak?
340
104
A Mr. Hickey was a very senior official who was
director of the White House military office; certainly he was
not working for Colonel Oliver L. North.
Q Sometimes I wonder about that.
A No, sir. I can assure you. You've got to know Ed
Hickey.
Q Ed Hickey would not?
A He's one hell of a man, okay?
Q Fair enough. With regard to the
matters, do you recall having conversations with Mr. Hickey
about them as it related to hostages in Lebanon?
A No. I talked to Mr. Hickey after I became the
National Intelligence Officer for Counterterrorism about
hostages in Lebanon briefly at a meeting at the White House.
We used to have meetings prior to travel by the President
overseas in which we'd do a threat assessment of potential
terrorist threats against the President, and early in 1985,
shortly after taking over as the National Intelligence
Officer, Mr. Hickey chaired something called an Operations
Planning Group, now defunct, which did this kind of
assess! ,
And I know that Mr. Hickey knew William Buckley
and wanted to have assurances that the intelligence community
and Central Intelligence Agency were doing their best to try
to locate and free Mr. Buckley, and I just assured him that
341
umsH«
105
kname cone
I don't think so. I really don't believe it did
ve were.
Q In that context, die
up?
A
at all.
Q So you have no recollection of knowing through Mr.
tha«^^^^^^^^^^^^were engaged
an effort through be it ransom or bribery but money changing
hands to free Mr. Buckley in 1985?
A Through Mr. Hickey I had no knowledge.
Q And, as I tried to understand you, you don't have
that knowledge from any source whatsoever; is that correct?
A I have no specific knowledge of whei
I had a plan to offer ransom to the captors of
the American hostages in Lebanon in any direct sense. All I
know is the incident in 1984 where in the context of another
meeting with Colonel North on another project he just
incidentally told me that he was hopeful that he could free
some hostages in Lebanon, that he had been meeting wit(
Z believe his name is, of DEA.
Q Hickey never asked you, to the best of your
recollection, to meet witn^^^^^^^^^^^^^with regard to
releasing the hostages in 1985?
A I'm certain he did not.
Q Do you know a CIA operative by the name ol
'iMCBISSflED
342
UNKIS^D
106
A ^^^^^^^^^^^H Can you identify him further?
Q That's the best I can do for you. If you don't
know, you don't know.
A Well, the name is very familiar. That may come
back to me. If it does, I will so tell you.
Q With that frolic, let's return to September 1985.
A That was an interesting movement to the side.
Q Reverend Weir was released on the 15th of
September, and on the 16th of September you have indicated
that you met with Mr. Casey and had a discussion with him.
A I think I testified I met with him on the 16th.
Q I'm sorry. That's what I meant to say.
A Okay.
Q On the 16th of September, can you describe for me
the meeting? Before you I^^^^WIHSEp^m interview
correctly, you said the only people who were at that meeting
were yourself and Mr. Casey; is that correct?
A That is correct.
Q All right. Could you give me your best and
fullest recollection of what transpired at that meeting
between yourself and Mr. Casey?
A I recounted what had occurred over the weekend and
that arrangements were being made to fly Reverend Weir to the
United Statei
343
p
107
that something was under way
that I did not understand, and that^olonel North had urged
that only Mr. Casey and Mr. McMahon be told and no one else
be advised, that it was an initiative of extreme sensitivity.
Mr. Casey stated that he had had the opportunity
to discuss^thCii^cC Adt^^ J^pi^pii^^^talsad tb^t ^,
^iic^iana^ndigaad^jjplt, tt^^a^gp^ ifetttiv ^^-7 -p
initlaM:ivr, ^ta^^»~imha^ig^^mtm iaw-that ir was
vet^i
lat^fc ^it lii«MfS|^tgiiu »t «»at poItPi^' "^^"
A Yes, sir.
Q You had testified earlier that Casey, when you
talked to him on the 13th of September, had indicated he
to do vit^^^^^Hjj^^^^l^HIJ^^^ Now
you're saying that on the leth^SFW^FB^^OBlf^^l^fe't right.
It's a McFarlane initiative. Were you left with the
impression at that time that Casey had not been privy to
McFarlane 's involvement in these activities earlier on in the
summer — July-August?
A At the time it was my impression that Mr. Casey
was unaware of this initiative and that he had not been
previously told about it.
344
108
Q Let me pursue that thought with you. Has there
ever been an occasion since that time when either directly
from Mr. Casey himself or by way of other information that's
come to your attention you reached the conclusion or the
surmise that Casey was aware of the, for lack of a better
expression, Iran initiative at a time preceding September 13?
A Only in reading the chronology that's been put
together where I believe Mr. Casey indicated that perhaps
sometime in August he and Mr. McMahon had been apprised of a
potential Iranian initiative. At the time that I discussed
the matter with him on the 13th and the 16th of September
1985, he seemed at first completely at sea as to what the
hell this was all about, and then on the 16th he seemed to
have recovered a bit, and he stated I have discussed this
with Mr. McFarlane and it is a very special initiative being
handled out of the White House.
Q You had occasion to talk with Mr. Casey in the
November-December period of time before his recent illness,
did you not, about the testimony he was going to give on the
Hill?
A I talked to him quite a bit.
Q During those conversations did it ever come to
your attention or did you come to conclude from talking with
him that in fact he had been mi^gBt^^^S^IS^S^^ <?uys like
to say, of this operation than he had appeared in September
i\
345
• rsri
109
when you talked to him in September of '85?
A More witting?
Q
A
summer?
Q
In the sense that he knew about it.
t
That he kn^w about what was going on in the
Ves, sir
ra«r
l^guXl^a had ,j»lt^t^ im
ri#fed
||<I.. iMl^l^BrJE^w hfih was
Monday . I
»n ill while I was overseas.
But he was consistent in not showing, to me at least, any
detailed knowledge prior to that phone call on the 13th of
Q Focusing on that sane period of time now, the last
346
110
contacts that you had in October-November with Mr. Casey, did
he in any of those conversations either state or suggest to
you that he by that time was aware of a relationship between
the Shaheen-Cyrus Hashemi contacts in June and July of 1985
and what ultimately became the Iran initiative in September
of 1985?
A I'm sorry. You'll have to reread that.
Q I'll restate it. Did it come to your attention in
speaking with Mr. Casey in October-November of last year,
1986, that he himself had concluded that the Cyrus Hashemi
effort to set up a dialogue on hostages was connected to the
McFarlane-Kimche Iran initiative that we now know was also
taking place in that time? Did he ever connect those two up?
A I don't think he ever did. When we were
reconstructing the chronology of the Iranian initiative and
the Agency's participation in it, he recalled the Shaheen
conversations and the fact that Shaheen and Cyrus Hashemi
were connected, and I don't recall at that time — he may
have mentioned, I think he mentioned in fact Roy Furmark.
But I don't think he ever quite put that initiative as
directly linked to the initiative that is now known
347
uHctftssra
111
conlS^km, and l^i^o^ tfcPaety, Kiacba ai«S oth«ra%w^^
doing? ..■?»- "^ 'T* ""^ - ^
A Not~spe<^flc3i^^to^ius«i^^ber« was a proposal, I
guesft^ by^biSiemi that hs could„4St ^jbf^hostages rsleas«d if
csrtain anis «D|r« pntiailsd t6' Irajt,^ X twlieve Shabesn was
told, jf^: be cias; nayb*^ v« codid 9^"^i^Sie nfliftcines. The
Director, I believe, said he tried to interest the Department
of State in this and the whole thing just sort of faded away
and Shaheen died of cancer. ^pS'^fe:-^^^^'^*^
% -'g^'jtrriii^Yeu^ 'WJiBl contacted again by colonel Xorth
on or about September 28, 1985, I believe from last time that
we met. Could you relate for us what it was that Colonel
North was seeking from you at that point?
A Yes. He believed that there would be a release of
American hostages in the 3 to 5 Oc^ol3*<^^^|^^^lV^^
He for^^^^^^^^^^^^^H^I He also —
think he also indicated that Ascari was coming to the United
States. But I didn't get any particulars on that until one
Saturday afternoon and evening, that he was coming under a
Greek a£tts pwiKrt,gBUPWMfcHi» tws l&»ti|$§II^^HBS^^^ a^
nan — - -~- - - - -— .^ -
348
MASSiJ£D
112
description o^^N(t tHSTT^
were doing the l>«i^yoa
^y^^ I ^J»34<M^iNi^fiffeady
X^ .^tall , eolonfti NorHIl up an"^insatial»le ^^tlte for
intelligence and he would frequently call and Tn^ca^ to me
that lui was not m&ii^^ i^£h-
efforts.
Q Putting aside that type of intelligence gathering,
did he ask you to undertake any other kind of gathering of
intelligence as of September 28?
A No. ^^^^^^
So basically^^^^^^^^^Hm^^^^that you
were focused on at that point?
A That's correct.
Q Now with regard to Ascari coming to the United
States, do you have a clear recollection of him raising that
possibility on the 28th of September or did that in fact come
later?
A I don't have a specific recollection, but I
iff * a S
349
believe he indicated that Ascari was coming to the United
States.
Q Let's hold that rjriU9«i^^^^^iiOK>lBea^'^^ttr'^ take
you back to that letter we looked at which I think we still
have, the October 7 letter. In that letter in paragraph 3 on
the second page you talk about being contacted by North on
September 28 and you talk about William Buckley in that
context. Then there is a reference a little further down to
the White House talking to you on October 5, which I think is
Colonel North again.
But what I'd like you to do is to take a moment,
look at what you were writing in October of 1985, and let's
see if we can focus in your recollection on the events of
that September 28 through October 8 period.
( Pause . )
First, Mr. Allen, I assume one could correctly
conclude that your recollection of events in terms of their
sequence and precision with regard to which they happened
probably would have been better in October of 1986 than it is
— 1985 than it is today.
A That's correct.
Q The sequence of events set forth in paragraph 3 of
Allen Exhibit 7, as I understand it, is that you get a call
on September asking f or ^^^^^^^^^^^^^^^| tells
you that there is continuing interest in Buckley, I take it.
...lief...,.
350
tiNeraiiiD
at that point; is that right? Is that what's going on?
A (Nods in the affirmative.)
Q Did you tell Colonel North, Colonel, I think
Butkley's dead?
A Sir, I tol
1985 twj^m^ie^
ll had concluded almost
certainly that William Buckley had died.
Mr. Casey agreed with me. I remember riding in
the car mmi^^BH^IB^K"'^
in some detail with Mr. Casey. I rode down to the
351
115
Intelligence Community headquarters and also rode back with
Mr. Casey, and he agreed with me that William Buckley was
probably dead.
Q So that I'm clear —
A And Colonel North was told of this.
Q That was my next (question. Colonel North was in
fact told by you at the time this material was being
generated.
A Yes, sir. I told him in detail that we had no
conclusive proof but it was my best judgment as a long--term
intelligence officer that William Buckley had died.
Q Okay. Did Colonel North express to you any basis
for his apparent belief or perhaps hope that Buckley was
still alive, or am I misunderstanding what Colonel North was
doing. Was it your impression Colonel North still thought
Buckley was alive?
A It was my impression that he had a hope. He had
known William Buckley when he had first arrived on the
National Security Council staff, because William Buckley was
working on counterterrorism and interacted frequently with
Colonel North. I think he just had a slim
352
Q I want to stop here _^^^ moBCifl^^enl^het^^
traclrthiv again, ^^ott've -toelff^e that essentially what
you're finding out about this operatior^^^^^^^^^^^^^H
^^^^^^^^^^^^^^^^^^^^Hind coi^^iiions you draw fro;n
It's not as if North sits down and briefs you on the program;
is that right?
A That's correct. He indicated very strongly that
this had to be compartmented and I had to live with just
enou^j^^formation which to do^^^^^^^^^^^^^^^H
worked in that world all my life and that was satisfactory.
Q I haven't, and it seems a little strange, so bear
with me as I go through it once more.
A It's very normal.
353
117
A I suspected Colonel North was involved, and I
wasn't certain who else might be involved.
Q But you yourself didn't ask Colonel Worth that
question; is that ric
A I think Colonel North indicated, either directly
or indirectly — and it was most of the time that he
indicated he was indirectly, through intermediaries,
providing what should be told this Iranian intermediary in
Western Europe.
Q The mechanics of that communication with the
Iranian intermediary, did you know what the mechanics were at
that time?
A He did not tell me at that time.
Q But did you yourself know in any event, either
from reconstruction or from other sources?
A Vou mean later on?
Q Really at this time.
A At this time I suspected — and we're at the 28th
82-688 a88-13
354
I Pra pf ^'^ codeIc|(^ I
118
suspected Isra«ris_wer#iinvolved'bssad j3if what the Dirifctor
had jt^^ iB«^B^^^|HHH|H|^^^^^^HH|H||[|^ I
i^su^^ctei^j^ruM intennediarl«8j_not i^^essarily^l^ the
government, aiaybe in tlie i^^iata jiedror -^j^gpisn't cei^in -
and oth«: AmericanK'-^^^^stu*p«c^^^XlS&|g^^e .oSicr Americans
-: invo^e<^t)Ut ^^^ rat. 1awr-^iai^aa^r;;-^^^#^~ ' ,_ ~lv
—"'Q Now l<^aM>:-juWFTi8^^^i^^^^p''^^^ ■u^^amdve^.a
~blt further.. Th^„tte»gBwSCg''!gg**** ^■»* -j^» pagyraph 3
.;^;:^a%~a# a:" ja^lfc ofl tamfc I gp^ij^j^ Anl^BHyy$^yi^z^9 m^
dai^tegttiraartr^
"^ — =*— - " "^ ti^slrau had
.sarie« :oi^iB«ging|^«
-qftrjjets^ ;^^:foTlair
]^oit£oh iirliiniiiniiFri
Ini^dt-^^
it seemed to me that the White House was either directly
^*)l VVILIL ,
355
119
i nvo ly^^ wiJfe^^aa^ggveriBiBnt eij^sriirl_6F^^^ire^l^fe — r^'^
dealers lilci^Ascai*^ «ho-«« thia ej«B«llent eont4£t in the
office of the PSifellni«U*l^-^^ -^-
Q Jgf3«i»
jt; jJCT>Bg|[_" ^lilN^* »*|Utwp here.
Yai- saifc th^^aa^unngaB«i**^ j]^ »JSr^-n»Tiiiii^Ji had oguthe
thiid W CffltoSer tbiat^tt :iiaia»*^^>w^^ft^U. 1 lam: Bucl^y
cr^^^ rijl^Rjninf^i^tnrtt^^^^gfira^-eontaclUi "^bf^giso^
i)i&M ai£ bla^^»i^^^^^^^^^[^ lEt^^^ige^=^
^Jndi^a^sd ia§MEBB^ttg^ j^ggai^SggiirtanC ^^fea t^^be come to-^e
U.S. -^r^|^'^o^^^^in^s«a»iE^t^|j^leST^»xi^^^
A Well, let's first go to the Islamic Jihad. On
October 4 it claimed that it had — it would execute William
Buckley and that his body would be presented as revenge for
the Israeli attack on PLO headquarters in Tunis on 1 October.
So that information was public knowledge.
This was what I was told by Colonel North, was
356
UNCMSSm
120
that Ascari was going to come to the United States because we
were at a crossroads with the possible death of Buckley —
and I believed strongly he was dead at the time — as to
whether there was any potential to continue this effort.
That's all I knew.
Q Bear with me. I got the impression from reading
that sentence that you . had knowledge that ttjpBiite Hoi^se had
in^^t^ Amri:^^ ^M to tiM^»rTO3^taiS^^=^it;pe^^ of
Q As to those links, however, you still did not know
what the linkages were between the White House and Ascari; is
that correct?
A That's correct.
Q So you didn't know whether it was Michael Ledeen
or the Israelis or some other person out there that worked as
the intermediary?
A That's correct. I did not know.
Q ^^^^^^^^^^^^^^^^^
Ihad you reached any
conclusions as of the time of this letter, in October 1985,
as to whether^^^^^^Hhad played any role in kidnapping
ifttsssra
357
•/C6DE\.
121
Buckley?
A Based on the intelligence that I had seen up until
that time and based on what little we knew or didn't know
abcuti^^^^^^^H there was no evidence that I saw that would
suggest that^^^^^^H was involved in his kidnapping. We had
strong evidence that the kidnapping of William Buckley,
Jeremy Levin and others was]
I to secure the leverage
against the United States.
Iwanted the United States
to influence Kuwait to release some of the Da'Wa prisoners.
Q Did it ever come to your attention, Mr. Allen,
that Mr. Ghorbanifar had told the Central Intelligence Agency
at or about the time of Mr. Buckley's kidnapping that^^B
[was responsible for that kidnapping?
A No, it did not.
Q You don't recall seeing that information in
Ghorbanifar 's 201 file?
A I don't recall seeing it.
Q Just to nail it down, Ghorbanifar himself never
alluded to that aspe<^^l^^^^^^^^^H.llC« i% r«lati«^hip
to i&: jtac^p^^tti^you iatMK5».^dBg^^gB«;mth-
is that right?
A He never stated _^
iither th» abduefeJS^og^tSit dwt^ oC^Wi^lwr
H!
358
359
THE WITNESS: Could I take a five-minute break?
UlffitftSSMO
360
361
y
SECRET/CODfiWOMi
125
.-? Q ^^^^^QU say on the first page of the October 7 memo.
Exhibit 7, that the release of Reverend Benjamin Weir was
effected by the White House, working through intermediaries
who were in direct contact with blank, who in turn was
dealing directly with blank. Those conclusions, that
statement in your memorandum, is that a representation made
to you by North that you were passing onl
Q So I understand, you felt you could reach the
conclusion that there was indeed a cause and effect
relationship between the initiative and the release of
Reverend Heir?
A Absolutely, and I suspected that there had been a
transfer arms Irar^^^^^^^^^^^^^^^^^^^H
Q Now Weir didn't have any knowledge about who had
362
MM-
#
UNtA^m
released, I believe, on the evening of 14 September. He was
asked to take letters from the other hostages to their
families, and he was taken to the British Embassy in West
Beirut and dumped out. It all flowed together that- this
movemmt of what ^^|pfcar«d jar»«L^gnBs^nto I#jf[~onittr« weekend
of 14.'HS Sep^«gy»er h#d;^;dij^^ correlation wi^his release
in^=W*st Jfeixut. _^-^S^- , _^^~r-._ .- ^^^i
*i^ Q Okay, ^q^ le^» g^ to-.pct^§^^^,^jAich- is what
■ "^Sr- "■• -^ ■-.■:. --^ ,- rr
real^t-lnspireaj this 1 e ttjSPF^fott : ga t a rfH-^ f riinprtfT^lgL. ^^
North on Saturday, October 5.
A Well, I got a telephone call at the office on
Saturday the "^^^ "'^'^^'*ftijBfrff|W^ii3'flWji|^'^^*"'9n^#g'^*^- """^
to come to the office. Colonel North is not always prompt.
I think I arrived in the afternoon and I think he did not
arrive until about 1900 hours that evening.
Q For us civilians, that would be more like 7:00?
A Yes. And at that time he stated that he had
information he wanted to convey to me about the fact that
Ascari was coming, traveling on a Greek passport and he was
known by an alias as Kralis. He also was being accompanied
by Yaacov Nimroc
He stated that Nimrodi was an Israeli who had
worked for the
^ i V '>ji i"
363
UNCl^""'
■i 1 x< i> •
127
I said, well, when is this chap coining, and I
believe he said he was coming on the 7th, and this was on the
5th, I
364
Pc] )Z8
loTAL-
365
Q Let me focus in to that. At the time you're
dealing with Mr. McMahor
fou know the person that we now know to
be Ghorbanifar as Ascari or using an alias name of Nick
Kralis, correct?
A Ascari and Nicholas Kralis, which is all I knew at
the time.
Q You did not know the actual identity of this
person?
A I did not, and neither did Mr. McMahon.
366
Lfffy^Tn^
130
determine- th«^raal identity ifi^iK^. sBtei^ ^^feKralis,
alia*es for GhorbanifSf' at tiw^yLine^B eim. in? -^
"^ -A ^ Bft^ no ef forlun ' -^^ "^^^ ^-
' Q^" Vfflfy rs-th*t? " ^. ^TT-.^ "'- ~^=#^~
Jk ^I-^HB n^^ked t^^>E,^g» lenq^^baaed on*
di«ci^'ions with "^xe^DirTCtor^.this, «as: iPfiiS^^Kouse _;
init fa^^E^. ^^Is <rai^g^8£ite-iig^%»'iri> ted ^iwGWity . W«
were not asked at this stage to provide
lany type of additional efforts to identify
Q Was it your impression as of October 7-8 that
Colonel North knew the identity of Mr. Ascari-Kralis?
A It was my impression that he did not know, but he
did not tell me that this individual was known by
Ghorbanifar.
^^Q ^^BS^^- what I'm trying to find out. I'm just
curious why it was that you all didn't want to know who it
was!
It was not our operation.
"mm
K\
367
iST/coDEwe|L II 1
i i ■t' «^ a » ■ L> I-'
Q So essentially you did what Colonel North asked
you to do, but you didn't question why or do any more; is
that right?
A It was not our operati
Q Did you have occasion to talk to Colonel North
about the contact he had on the 7th and 8th of October with
the folksV^^^I^^^^^^^^^^^^^^^^^^H^^^HB^I
A I believe that after the visit he indicated to me
that he had had a discussion with Ascari and told him that he
expected this activity to result in the release of Americans
in Lebanon.
Q Let's focus specifically on that. Do yc recall
him telling you that he had met at his office in the Old
Executive Office Building with Mr. Ascari, Mr. Schwimmer, Mr.
Nimrodi, Mr. Ledeen?
A No, he^ did not mention^ aey of^tJaose individuals.
sons^aiwr* Mr. Ascari «rtB|^ai¥*n^;
^Q^\ifo you have no kndSled^, ev«B tho^h today, of
m
368
UNCtASffiO
132
what transpired At a mfeting in Co^|^ .*lortte'-s-:=ssarice with
Ledeen, Nor^|^|Iimrodi , ^chwiapeKainA'^^feanifar?
A Only what X've read in chronologies and
information that's been developed since the initiative was
exposed .
^^^^^^^^^ wbfiOL,€pla0elr:l||^p!j^l:£.$Pirtteit he had had a
discussion with Ascari, did you conclude that he knew —
A Let me c^^^e^^t the.esCOrds^SJhen Jftr. "Ledee^ talked
to B» 3on - X^^jja^i»?f ^ 8 ^iP- in41fi|i^^^hat\ the individual by
the name of Ascari was Mr. Manucher Ghorbanifar, that -Mr.
Ghorbanifar had met with some individuals at the White House,
including Colonel North in the early October time frame, and
I don't recall who all he said was at the meeting.
Q When Colonel North told you in October that he had
had a conversation with Ascari, this would have been within a
day or two of Ascari coming in on the 7th?
A I think shortly afterwards.
Q Where did that conversation take place between you
and Colonel North?
A The Old Brogue Irish Inn in Great Falls.
Q And what was the occasion that caused you and
Colonel North to be together at that watering hole?
A Beer. We stopped just for a social drink that
evening.
Q Was your relationship with Colonel North one of
• --5 1 ■,■ vt J ; ? f.r. ■'-f
369
133
friendship? I mean, did you socialize with him at all at
that point in time?
A I had socialized with Colonel North prior to that
time, when I was in OSD. This was not anything unusual.
Q I'm not suggesting it was, but he was someone that
you dealt with outside of the office as well, a fellow you'd
have a beer with from time to time?
A Well, yes. We tended to focus on problems at
hand.
Q Couldn't leave it at the office? I understand.
Was there anyone else present when you had this
discussion with Colonel North?
A I don't think so.
Q Did you make any memorandum for the record or any
other documentation of the conversations you had with him?
A No.
Q Can you give me your best and fullest recollection
of what the Colonel told you at that meeting?
A He stated that he had made some very strong
remarks to Ascari about the need for success in obtaining the
release of the American hostages. I don't recall the exact
language, but he was adamant that this had to go forward to
quick fruition, that this individual keep his commitments and
not deceive in any way the U.S. Government in this effort.
Q Did he outline to you what his program was.
370
134
looking toward the future?
A No, I don't think so. We talked about a number of
other issues, including the old program that we had at OSD.
Q Was it your impression at the time that you had
this discussion with Colonel North that Colonel North in fact
knew the identity of the man that he identified to you as
Ascari?
A He didn't state that he knew him other than as
Ascari. He said that this individual was an Iranian who was
an arms dealer and as a result he had some doubts as to his
trustfulness and this was the reason that he had spoken in
rather strong terms to Ascari.
Q He did not ask you at that point to develop
further background information on who this person was?
A Not at all.
371
Q So that I'm clear on what you at least knew to be
the status of knowledge in the Operations Directorate,. were
you keeping Clair George apprised of the work that you were
doing with Colonel North as of October 1985?
A I don't know that I discussed with him all the
details, but in general he knew]
Q Did he know
A I can't recall and I don't know.
Q similarly, you would not know whether or not he
knew that Ascari was in the United States on October 7 and 3,
1985?
A I suspect — I believe he did, becaus*
^^^^^^H^H being made available to the Deputy Director
and to the Director, and I believe the Director tried to keep
the Deputy Director of Operations informed.
Q Vou believe that based on what?
lEO
372
IINCmSlflED
136
A Based on the fact that we were only getting one
copy of these documents, but I believe that at least some^^|
were being made available to Mr. George.
Q Apart from whatever conclusions he could have
drawn ^^^^^^Hj^^^l^^^^^^^^^^^^^l^l^l^^^^^H do
you have knowledge of any other elaboration of what was going
on being given to Clair George?
A No, I don't know.
Q Similarly^^^^^^^^|and his deputy
A I don't know what they were being told at the
time. I left that to Mr. Casey and Mr. McMahon to decide
what to tell
that^it'i^^Mi^^lei
a. ^ xmderstand. ' Agft ^r«^f^ka f^^V ^° *"y meeting
that t^k ^Bf?*fe]^^^'*8fe*Jlgfe^hif^i^^ion» Direc|^
project?
A
Q
A
recall
In the October time frame 1985?
Correct.
No. I didn't attend any meetings that I can
373
Q Just so I can keep your role in perspective, you
still as of October 1985 are principally involved^Bf^ta
l^^^^m^^^^^^^^^^^^^^^m^^^^^^^^^^^H f o r
North?
A "®^^^^^^^^^^^^^^^^^^^^^
I was aware in
October, during the Achille Lauro event. Director Casey spoke
about the initiative. We were getting ready for a National
Security Planning Group meeting on the Achille Lauro with the
President and Mr. Casey brought up the initiative and stated
that he was convinced that Mr. Schwinuner was involved in the
activity. He did that on, I believe, about the llth of
October .
Q Let's focus on that aspect. I think maybe the
best way to lead into it is to talk a little bit about the
Achille Lauro incident. That occurred about the same time
Ghorbanifar came into the United States. That would have
been October 7, 1985; correct?
A That is correct.
Q You were involved in the CIA's response to the
Achille Lauro?
A Very heavily.
374
138
Q And Colonel North was also involved, correct?
A That's correct.
Q You also would have gotten to work with or at
least to meet Michael Ledeen at that time; isn't that right?
A I did not meet Mike Ledeen. I talked to him on
the secure telephone several times during the week of the
Achille Lauro.
Q Why was it that you were in contact with Mr.
Ledeen at that time?
A Well, when the Achille Lauro was first hijacked by
the Palestine Liberation Front terrorists I called Colonel
North immediately and Mr. Ledeen answered the telephone, and
I told him to immediately page Colonel North, who was at the
Department of State, which he did. Mr. Ledeen asked me to
continue to transmit information as it arrived until Colonel
North returned, and I did that.
And I guess I talked to Mr. Ledeen a few times
during that week, particularly from Wednesday — Thursday,
about noon-on, when it was clear that we had a golden
opportunity to intercept the four hijackers along with Abul
Abbas.
Q Was Mr. Ledeen introduced to you in any fashion?
You get a strange voice on the other end of the telephone?
A I had to correct the record because I had had
lunch with Mr. Ledeen in August 1985, I believe, at the
375
139
request of Colonel North. He said Mr. Ledeen was a
consultant on counterterrorism and wanted to meet the
National Intelligence Office, so we had a lunch at Jean
Pierre. So I had met him once and we had talked mainly about
his background, living in Italy for eight or ten years, the
Papal assassination attempt. It was a very generic
discussion on international terrorism trends.
Q Was there anyone else at that luncheon with you
and Mr. Ledeen?
A No.
Q Was there any discussion at that luncheon of Mr.
Ledeen 's travels to Israel?
A No.
Q And no mention of his relationship, new budding
friendship with Manucher Ghorbanifar?
A None whatsoever. So when Mr. Ledeen answered the
telephone on 7 October I at least could put a face with the
voice.
Q And it did not come to your attention in this
series of telephone calls that take place 7th, 8th, 9th,
10th, whatever, of October, that Mr. Ledeen was at that very
time meeting with, dining with Manucher Ghorbanifar?
A Not at all. I was focused totally on the Achille
Lauro that week. I'm afraid Mr. Ghorbanifar was very much a
back-burning issue at that stage.
D
376
flMMSVB
140
Ghorbanifar that he met with and had dinner with Roy Funnark
on 8 October?
A No, I did not know that.
Q Do you have knowledge of any contact that Mr.
Furmark would have had with Mr. Casey at that time?
A No, I have no knowledge that he was in contact
with Mr. Casey at that time.
Q Now in terms of actually having another face-to-
face session with Mr. Ledeen, that would not have occurred in
the week of October 7; is that right?
A That did not occur.
Q When next would you have had such a meeting with
Mr. Ledeen?
A I believe it was November 1985. He called on Mr.
Clarridge and me at the Agency — the specific date probably
is available somewhere in the records of visitors to the
Agency — where he brought in some information that he stated
related to Iranian terrorist networks in Western Europe. He
did not name the source of that information. In fact, he
refused to do it, and he brought — I think he brought a
photograph or so with him at the time.
Q During this period of time, as we move into later
October, do you recall preparing a memorandum for Colonel
HNicm
377
uwGtA^^^"^
141
North on Near-Term Middle Eastern Terrorist Threat?
A I probably prepared that particular report more
than once. I don't recall the specific paper.
Q Let me show you a memorandum addressed to Colonel
North dated October 29, 1985, which appears to be by you, Mr.
Allen, which we will make our next exhibit.
(The document referred to was
marked Allen Exhibit Number 9
for identification.)
( Pause . )
A This sounds pretty good to me. I recall the
threat data at the timefj
So this is just a
regular assessment.
Q That was my question. This is addressed to
Colonel North. With regard to this particular memorandum,
why were you sending Colonel North this kind of material?
A Because he was the coordinator within the National
Security Council staff for terrorism and these were some of
the thoughts that I had of the current threat and some of the
possible countermeasures that might be taken to deal with the
threat more effectively.
378
Ewq^
T/CODEWqM)| 142
Q Colonel North's responsibilities with regard to
countering the terrorist threat, he had held those
responsibilities throughout '85; is that correct?
A ff*^» ha toaJCh over from Major Christopher
Shoemaker in August 1981 as. having responsibility for
counterterrorism on the National Security Council staff.
Q I want to focus on '85, though. At that time was
he the principal coordinator of counterterrorism activity for
the NSC?
-- A He was the principal coordinator of NSC-related
counterterrorist activity.
Q Had he given responsibility over that area to any
subordinate of his? Was there someone else that sort of
carried on day-to-day responsibility?
A He didn't have any staff members at that time who
worked for him.
Q You would have prepared reports such as this how
frequently — on a regular interval?
A Well, I do a monthly threat assessment. That's
what I was going to do Friday morning, hold my warning
session on the current threats to Americans and American
facilities worldwide. I do this on a regular basis. 1
normally prepare that for the Director and the Deputy
Director on a monthly basis. I sent this, evidently, to
Colonel North. Perhaps I wrote it at his request or perhaps
379
143
I had written a paper and I decided to send the paper to him.
I don't recall whether he asked for it or whether I just sent
it to him because I thought it would be of interest.
Q That's what I's trying to pursue.
A I suspect I felt that this was something of
interest to him at the time.
Q I have not encountered periodic reports of that
kind addressed to Colonel North, and I'm just curious whether
you would have done this on a monthly or quarterly basis for
Colonel North or not.
A No, I didn't do it on a monthlyaiSptiSm TSt Mm
actually requested. I suspect he did; otherwise, I wouldn't
ha^% sent ^t^Jhin^' "^3^ wiSHaii^^a^^»te^-|flff^v"'ca£ent_
wrote .
Q Now let's drop back again. You said that Director
Casey had — and I hope I'm not mischaracterizing -- some
kind of a meeting or session or discussion in the context of
the Achilla Lauro in which you talked about the Iran
initiative.
A We were walking to his office, where we were going
to have lunch and then go to the NSPG meeting chaired by the
President, and we were discussing the initiative and t^CSact
&i 3 ft t.t L.ny V ! I i L
380
UNSMFB
144
that th«^ InAil^^al Xr )cn«w ii@Bl^iE»^ ^s in Washington about
that tine, or had been in Washington that week, that he was
there with an Israeli^'liamed Niorodl«: I dcgjS belilve Mf .
Casey had beafdo^SiB* ^^.-^^^^ ~ jSIC'" =?-'
Mr. Casey stated that he felt that Mr. Schwinuner
was involved and that Mr. Schwinuner was a man who could get
things done, but Mr. Casey specifically indicated he had some
doubts about the total reliability of Schwinuner. I recall
walking to his office and Mr^^^Acy ^Mking these statements.
Q Was there anyone else present when you all took
this walk?
A
Lac^fe ^"data j# ^^- ^'^-^^ ."^ ■
A. "^Aroxas^^^Sac ll^^X-jCag^v^r i f y that, but it was
around the 10th^<»r7^^-.aJ^litob*iBS^hi^xIite of the NSPG that
was held on the Achille Lauro.
Q with regard to Director Casey's knowledge of Mr.
Schwinuner, did he indicate to you the basis for his knowledge
of Mr. Schwinuner?
A No, he did not.
Q The source of his knowledge?
A No.
Q As of the time you had this conversation with Mr.
Casey, did you know of Mr. Schwinuner or his involvement in
this matter? .,.^„„, „_
■; KJB'jsJcai'Kr-
I
i
381
UNCUSSiBEO
145
A I had heard of Mr. Schwimmer, who was involved
with the Israeli aircraft industry, but I knew nothing about
Mr. Schwimmer or his background or his credentials.
Q And specifically with regard to the context of the
Iranian intermediary you had not encountered Mr. Schwimmer 's
name before Mr. Casey raised it?
A No, I had not.
Q Did you explore with Mr. Casey who he would have
been discussing these matters with?
A No, I did not.
Q Was it your impression that he was having
conversations o£ his
■»(:ter? - -•'?%
Casey's ilnd_at.-.^« ^g||^_^^p^^> . I'W '"" "^^""^iBP ^'
indicated something to you that would have told you —
A He didn't say that he had talked to Colonel North
about this issue. You'll find other memoranda from me to
Colonel North assessing threats, so it's not unusual to send
something to the National Security Council staff.
Q It sometimes is unusual for us to actually receive
those materials, but this is the only one I've gotten on that
point,
A Actually, it's quite a good assessment.
I jtdibf iiici
i^f he'
I i! i
382
UNWHD
146
Q A dynamite assessment. I'm glad we had it.
The Tower Commission report indicates that Colonel
North, on 12 November, was in London and met with,
separately, Mr. Ghorbanifar and Terry Waite. Did you have
knowledge in early November that Colonel North was making
that kind of a trek ta liBaidon?
A, I believe I knew he wm in London, but I had no
knowledge of what transpire* "nor, "to the best of my
knowledge, did he give any details.
^ Q Old there eyeiagejBlgi: «.^t^fe when (^lone^#rtlf^
on- or ajbutrlfesfiiaber 12 wtth Hr.-~^Ghorten£IKlr^ ^^
^pt~^C^l that~iie ever talked s^licitl^
about ~a neej&Jji? on 37 No^mher in London. — ^^ -^-
'\^-'_Q^ DlifelitfTever J3>|l :^u abotit j^aeeting in" early
WW ou-|0^ 12tH^^
Q^ Mi^Spiloiwl Nortl^Mt^ you eil^t a meetii^ he'd
had with Ghorban^^ in ^ndowr^in early November? 3^
a:; I^oi^rxecalT. r^^ :P°s*^*>5* hejraid. I^ga
iff^^ti^»"
>f anyoi^^^iSiQs^raVeled
^U
383
UKGLMffiD
147
A No, I don't.
Q Do you have any knowledge of a recording device
that Colonel North would have taken with him,]
^^^^^Ito make a record of what
transpired in the rooml
A Not at that time.
Q When did the existence of such a device in the
possession of Colonel North come to your attention?
A When I met with Colonel North along witl'
Mr. Koch, Major General Secord, in Room 370 at the
Executive Office Building on 29 January 1986.
Q Prior to January of '86, though, you were not
aware of the fact that Colonel North made use of such
recording devices?
A I can't recall that I was ever aware of that prior
to 29 January 1986.
Q November 14, 1985, according to the Tower
Commission report, Mr. McFarlane met with the Director, Mr.
Casey, and the Deputy Director, Mr. McMahon, and told them
during the course of that meeting on the 14th that the
Israelis were going to be giving arms to Iran. Were you made
aware of that session between Casey, McMahon, and McFarlane?
A No, not that meeting. I was not aware of it. It
wasn't until the 16th, I believe, of December that I had the
opportunity to discuss the initiative at some length with Mr.
384
iiNot«e
HcMahon.
Q ^ Again focusing y^iur attantion on th« late November
— excuse^HWty late October-first o^ple-of wee)cs of November
period of timet .did it comtt>~to ^jpour attention during that
period of time that Mr. Ghorbanifar, under the guiae-of
Krai is, -Ascari or Anx, other nwna h*A returned ^ the United
stattesl
A- In the Novem^[a^^M,:S«ine7
Q " LaJep=<re&ober-fliM^L NoveidMi*.
~ ^ it^a^ttS^Tp
g^ 4..aWB^<icality.yi»FiMiJ^kt^ asl
S^A =r^t tojthe luMffe oggty2^°'^^^>*>__;P^^*^ "^J*^ ^'^^^
a dart f ron a^onel VBetSt i^^I^lpColonel North told you_-^
thathe was going to- be going^ to Geneva SMwtimAr in the not
too dia tact ggutnre . ^%_ rx^_ — •
A No, sir.
Q I am misrecollecting.
stat«i^»rt- important meeting was occurring in Genev
385
imB
that he felt a
solution to the American hostage problem in Lebanon would
shortly be at ha
Q Let's back up on that. First, when do you recall
that conversation taking place?
A Around 22 November.
Q Circumstances. Was it a telephone conversation?
I was theH^^^H^mHof when
contacted CIA and asked that I call him immediately. -I did
so. It was in the evening, as he is wont to call, and I told
him thati
|l would work very
assiduously
Q Now, to help me try to fix this in time, you will
recollect that on November 22 and 23 activity was under way
with regard to ultimately the CIA proprietary delivering
goods .
A I was not aware of that until the 23rd.
Q But to help you fix on when this conversation took
place, would it be your recollection this was the night
before?
A It was either the night before or Thursday
evening, which would be the 21st. It could have been
B2-688 0-88-14
386
iiNim»D
150
Thursday evening the 21st.
Q The conversation would have been via the secure
telephone, correct?
A Always.
Q Did you make any notes, memoranda, anything on
this telephone conversation with North?
A Well, the Independent Counsel has all my
handwritten notes, and it is conceivable that I made some
notations, but until I. can see my notes I cannot verify that.
Q Do you recall going the next step of putting your
notes into a more polished format?
A No.
Q I'm with you. Now let's take it step by step,
though. Colonel North told you that it was going to take
place at a particular point in time, the meeting?
A Well, on the weekend in Geneva.
Q
A Something like that
Q And he said it was going to take place in Geneva,
Switzerland?
A That's correct.
So that would be the weekend oj^ the 23rd and 24th?
387
m&m
151
Q Did he tell you who he anticipated being at the
meeting?
A No. He stated that Ghorbanifar — not
Ghorbanifar. He stated that Ascari would be there, that
there would be some intermediaries involved, and I believe he
indie ^^^^^^^^^^^^^^^^^^^
that^^^^^^^^^BwouI
ird for me to recall the
388
TpTAL-
389
ivsmm
155
Q - Fin«>— -ttB problem. With regard to the
conversation with North on the 22nd, it was restric
390
P^^^i^il^ll^ri
yr
North at that time?
A Well, he stated that he felt that if the meeting
went successfully that there would be a sequential release of
American hostages and possibly the return of William
Buckley's body. He did not delineate just what type of
transaction would produce the recovery of the hostages and
Mr. Buckley's body.
Q Bear with me. When you said he didn't delineate
it, did he give you a broad hint of what was coming down or
not?
•^^{-i^ go he said he thought it was going to happen but
he didn't tell you the basis for that thought?
A That's correct.
Q Did he ask you to play any role in accomplishing
something in the same time period as this meeting was taking
place in Geneva to facilitate the release of the hostages?
A No role at all of an operational nature.
Q Specifically as of the time this telephone call
took place you were asked to do nothing with regard to
arranging for airplanes or getting clearances or setting up
anything for him in the Agency?
A No other activity whatsoever.
Q And you did not know at the time of this telephone
call that there was going to be a need for airplanes or
mmms
391
wmm
157
schlepping goods from one part of the world to another?
A I did not know that.
Q Now let's move to November 23, 1985. You did
become aware of November 23, 1985, of an airplane or airline
arrangement relating to the hostages; isn't that correct?
A I don't think I would phrase it that way.
Q I hope you wouldn't. Phrase it better than that.
A I was called at home and Colonel North wanted to
know why I was at home. He wanted me to show|
materials on this Iranian initiative to Mr. Clarridge,- who
was Chief of the European Division, and said why don't you go
to work. So I did that, and I went to work and I went up and
obtained my f ile^^^^^^^^^^^^Hand took them down -to
Clarridge, who was there in his office, and most Directorate
of Operations Chiefs are there on a Saturday morning.
And so it wasn't unusual to find him there. He
read them. I said I'd been asked to do this by ColtfflB North
because Colonel North" vantme^tn^S understand that this was
a very serious initiative under way by the White House.
And Mr. Clarridge leafed through them — by that
time there were quite a number^^^^^^^^^^^ — and indicated
that yes, he believed this was a serious initiative. And he
told me that Colonel North had requested some assistance in
oti^ijalEev^m name of a reliable charter airline. He had been
trying to do this. I believe |L^lP-tl8.U}^<^3^^<^ ^^ ^^^ going
I believe alfp.he in(
392
158
to try to obtain some form of clearance tor a'
aircraft to land
in a certain country that fell within his divisional
responsibilities.
And that country, I believe, wasi
Q Let me sort of walk yoggthreugh this step by step.
You would have gotten a telephone call from Colonel North on
the morning of Saturday, November 23.
A That's correct. --<^.-i-.^
Q ApE^ximately what time?
A ^<^^^ I think he called — I was going to go to a
football game with my family, and he called about 8:30 or
come to the off ig« and h^p hjm-Jjecause he wanted to make
sure Mr. Clarridge was aware that thi^twas a serious
--«
And when I arrived at the office I called Colonel
North on secure, I ^s^i-sve^^^a^^p^^yi ^^Ipa^^^ee^Bg:
effort(aa>hat he was having some problems, that things had to
be accelerated and for me to go down and see Mr. Clarridge,
which I did.
And then Mr. Clarridge explained that Colonel
North was looking for a reliable charter airline to move some
equipment to Iran.
Q Mr. Clarridge had not been privy, to your
knowledgej^&Q^^^^^^^^^^^^^prior to this time; is that
S«B
393
\mmm
159
correct?
A To the best of my knowledge he'd never seen them
and indicated so when I showed them to him. It came as a
surprise to that^^^^^^^^^^^^^H existed.
-Q^ I'm having a little trouble following why it was
that you would have shown^^^^^^^^Hto Clarridge to help
establish North's bona fides. I'm having trouble with that.
A Not North's bona fides but the bona fides of the
initiative, which was clearly directed at getting hostages
out of Lebanon, also clearly directed at Iran.
Q Oo you recall any discussion with Mr. Clarridge or
anyone else or Mr. Clarridge talking either directly or
indirectly to Mr. McMahon about whether or not he ought to
proceed with this matterl^ :;~^r*J2fe'-^"" ^5«- -c=r>->^=_^;
A I don't recall that at all.
Q Do you recall talking to Mr. Juchniewicz about
that^l^Se^^^«ings on the morning of the 23rd?
A No, I did not talk to Mr. Jncht^SSlc^' ~-^
Q with regard to Mr. Clarridge, he wa^Qwre at the
time you arrived, right?
A He was in his office when I came down from the
seventh floor to the fifth floor, where he is located.
ife.riT Q And that would have been approximately —
A Fourth floor.
Q That would have been approximately what time of
(ma^HD
394
day?
*^- X imagin* I if rived there about 9:30, 10:00.
Q So you arrived at his office about 9:30, 10:00?
A I arrived probably in my office about 9:30. I
picked up my mail and I think I had another!
I looked at that and I included that in the
reading material for Mr. Clarridge.
Q Then, when you walked down to see Mr. Clarridge,
Mr. Clarridge indicated to you that he'd been there for some
tim«, ^ada«^..-^_^^^^^^^=^^ff ^^^r - ^' •
A He didn't say how long he'd been there.
Q Did you know how long he'd been there?
A No.
Q Do you know today how long he'd been there?
A No.
Q In terms of what Mr. Clarridge told you he was
about, what did he tell you?
A He stated that he was working on obtaining a
charter, trying to help Colonel North obtain a charter
airline, and that Colonel North needed the name of a reliable
airline that could be passed to an intermediary working this
problem ^^^^^^^^^1 Mr. Clarridge didn't seem to know much
about the initiative except that he said Colonel North was en
route to his office and that he would have more details.
Meanwhile, I believe he was working on the problem
-ii i 51
■? 1 «u.
395
161
and the idea had occurred that they might use the CIA
proprietary, might just use this as a normal charter
activity.
Q That idea was abroad as of the time that you met
with Clarridge that morning?
"A -^ »8j^ld say it certainly had occurred to Mr.
Clarridge.
Q Was there anyone else present when you had this
conversation with Mr. Clarridge?
A I don't think so. Later in the day Colonel- North
and^^^^^^HH^^^K I who head
arrived.
Q Now you were present when Colonel North arrived?
A I think I went back to my office and then later I
returned and Colonel North had arrived.
Q At what point was a representation made to you
about the cargo to be carried by this jMai*tt^ M^jj^Mter
aircraft it might be?
A I can't recall specifically, but Colonel North
stated emphatically that this was oil-drilling equipment that
was being sent into-^HBifc It IrteBaB^faMtj^ to the meetings
occurring in Geneva. I believe in my presence and Mr.
Clarridge he made a call to the Deputy National Security
Advisor, at the time Admiral Poindexter, to get Admiral
Poindexter's endorsement to proceed with this activity. _
UNCtSSSfflfD
396
M4fflED
162
Q I'm sorry — Admiral Poindexter or Mr. McFarlane?
A Well, I think he may have called both. He made a
number of telephone calls while I was there.
Q Was Colonel North actually present and were you
present when Colonel North actually said that this was oil-
drilling equipment?
A Yes, I heard him say that.
Q You heard him say that? ^ "^
A Yes. I've testified to that and I'll testify
again. I heard him say it. ~
-•='^*-igR "-Vbu during this period of time, up to the time you
had the meeting with Colonel North, were you aware of or were
you sho#n any of the cable traffic that was being generated
to and from Mr. Clarridge?
To and from Mr. Clarridge?
Q Um-hum.
A I knew that cables were going out ^^^^^^^H and
also believe^^^^^^^^^^^^H because
Clarridge felt if an agency proprietary was used it would
have to have some clearances. I don't recall the specific.
I don't think I read any of the traffic specifically at the
time. -^
issue of apprbpriat* cov«r
UNIitAtrMU
■ alrlin* «o -it would look
397
163
like a rtornol chairter actXvity. - All ttutj^^s required was
for, I believe, the manager of the airliner^ the CIA
proprietary, toybe put in eofltact.irit^ iEJJr. Coj
Q ^ With regard to time dif ferences^^^^^^^Bln
Itranslates^iio rougHii^^^^^^^ in the United
Stains IT Do^ ^at sound~llt?oiit
fe ^ Sound^^bou^X^ight .
.-^^ S«^^^Senv4^sa€loir3that took place ir^^^^^^lat
|on ttuij^d^et KoveBb«r would translate to
aboul^^^^^H f^ tti^23^^in^^« United 4|at9s; is^'-t that
rigHp "^ "^ * ^
No,
It would be about^^^^^^H here, abouti
[difference between^^^^^^ and the United States.
Q All right. Did it come to your attention that
there was a cable fromi
[of a conversation that he had on the evening of the
23rd with a man he )cnew as Copp, who we now Jcnow is General
Secord?
A No, I did not )cnow of that at all.
Q Do you know of it today, that there were such
cables?
A I knew there were cables, but I don't know where
the matter with Mr.
^^^^^^^^^^^^^^^^^d i rect 1 y
398
164
Copp, known to us as Major General Richard Secord. No, I had
no knowledge of that.
Q You had no knowledge during those meetings that
you had on the 23rd of a cable fron
to Mr. Clarridge stating that he had had a
conversation with the man we now know as Mr. Copp in which
Mr. Copp indicated that the cargo to be carried was HAWK
missiles?
A No, I did not know that such a cable existed.
Q And you've never seen such a cable?
A I have never seen that cable, to the best of my
recollection.
Q Have you ever had occasion to speak with the
gentleman wa^^^^^^^^^^^^^^^^^^^^^B^^^^^^B at
that time?
A I have not had the occasion. I don't know whi
■was at the time.
MR. WOODCOCK: His name was
THE WITNESS: I've heard of^^^^^^^^^ but I've
never discussed this issue with him.
BY MR. KERR: (Resuming)
Q It's never come to your attention that
[stated under oath that he sent such a cable to Mr.
Clarridge on the 23rd?
A I have no knowledge that he sent such a cable.
UNebWED
399
165
vrhen Colonel North spoke about oil-drilling equipment, ^^^^^|
^^^^^^^^^^^^^^^^^^^B, say and
I've testified to that, as to whether Colonel North was being
totally candid as to the cargo.
Q I understand. Let's pursue it from that angle.
You did not suggest to Colonel North that he ought not to be
lying to you all about what that cargo was?
A I did not confront Colonel North on that issue.
He had stated emphatically it was oil-drilling equipment.
Ion the
22nd or 23rd, probably that morning, it raised some questions
in my mind as to the reliability of that statement. However,
this whole operation had been shrouded in great secrecy by
the White House and there were many parts that I was totally
in the dark about, and I did not know at that stage just
precisely what was occurring.
At the same time, inwardly I had serious doubts,
and I think Mr. Clarridge had some doubts, too, and concerns.
Q In terms of Mr. Clarridge 's doubts, did he express
those doubts to you?
A No, I don't think so.
Q You did not have occasion to talk with Mr.
Clarridge about his assessment of what this cargo was?
A No.
Q You have never heard^ Mr. ^J^ridge state whether
e never heard Mr. Clarrid
400
IIN£mFIED
166
Ithat the cargo to be
or not he received a cable fron
carried was HAWK missiles?
A I've never heard him state that at all.
Q When, if ever, did it come to your attention that
Mr. Clarridge gave instructions tol
to destroy all of the cables that had been
sent out oi^^^^^^on this matter?
A I have never heard of such an order having been
given by Mr. Clarridge at any time.
Q Do you have any knowledge of the destruction of
the CIA headquarters copies of that cable?
A Absolutely not. Since I didn't Jcnow it exists, I
don't know anything about its destruction either.
Q The cable in question would have sent to Mr.
Casey, Mr. McMahon, as well as Mr. Clarridge. Have you had
any occasion to talk to Mr. Casey or Mr. McMahon about the
cable they would have gotten froa
indicating that the cargo to be carried was HAWK
missiles?
A No. I never discussed the cable traffic between
and^^^^^^^^^^^^^^^^^^Hj^^H w i th
Mr. McMahon or Mr. Casey. Mr. Casey was out of the country,
wasn't he, during that period?
Q I can't answer that question; I don't know.
A I'm almost ^z^atfift M}#% M»i aSqA^y was
msnr
401
mmmm
during that period.
Q I have no idea how one delivers the mail to the
Director when he's out of the country.
A You certainly don't deliver every incoming cable
when thousands arrive every day.
Q In terms of who was keeping an eye on things for
Mr. Casey, Mr. Casey's executive assistant at that point
would have been a guy named ^^^^^^^^Hf is that right?
A I don't know. I can't recall who was his
executive assistant at the time. I thought it was
Q You don't recall having any dealings wit
on behalf of the Director?
A I don't recall any specific dealings with
Q With regard to the flight of th€
aircraft, you were aware that Mr. McMahon was concerned about
that flight when he returned to work on the 25th of November;
isn't that correct?
A I understand he was very concerned. Mr. Clarridge
told me that he was concerned. I talked to Mr. clarridge
briefly on the 25th.
402
Iby the morning of the 2 5th or by the morning of the
26th I was fairly well convinced that it wasn't oil-drilling
equipment.
Q It was not oil-drilling equipment?
A That's correct, and I've testified to that.
Q I understand that. McMahon was quite convinced on
the 25th it wasn't oil-drilling equipment, too; isn't that
right?
A He was upset at the activity on that weekend and
had ordered the General Counsel to look into it, and Mr.
Clarridge had expressed concern about the reaction of Mr.
McMahon and stated that the General Counsel was looking into
it.
uHcyissui^
403
DNCLASSflED
169
Q Now with regard to assignments, you recollect, do
you not, that Mr. McMahon felt strongly that a Presidential
Finding was required for this activity; isn't that right?
A I'll have to put it in the context of the
conversation I had with Mr. McMahon on the 16th of December,
where Mr. McMahon described in some detail the meeting that
had occurred with the President on the 7th of December where
he was present for about an hour and a half in which this
initiative was discussed.
And Mr. McMahon had at that point argued, I-
believe, against the initiative or had certainly pointed out
that the intermediary involved — we knew who that individual
was by that time — was unreliable and had emphatically
stated that if the Agency was to support the White House
Iranian initiative it would require a Presidential Finding,
and he was quite adamant on that and told me so in no
uncertain terms.
Q I'm with you, but I want to take you back to
November. Do you recall being aware on November 25 or
November 26?
A On the 26th Mr. Clarridge stated that Mr. McMahon
felt that there should be some sort of Finding possibly
developed on this whereby there was an approval received at
the top from the President saying that this was a legitimate
activity for the Agency to have undertaken.
404
mmma
170
Q You're getting this information from Mr.
Clarridge. You did not actually discuss it with Mr. McMahon
on the 2 6th?
A I didn't discuss it with Mr. McMahon, to the best
of my recollection.
Q On the 26th?
A No, sir. I did not.
Q And you did not have a similar discussion on the
2 5th, the day before?
A No, sir, I did not. . -
■ ■ =*^ ^
Q You were or were not aware that on the 26th of
November Mr. Casey asked for a Presidential Finding on this
matter?
A I know that from the chronology, but I did not
know at the time.
Q So you didn't have knowledge this was being sought
as of the 26th of November?
A No, I didn't.
Q Let me show you a note of November 26, 1985 from
Mr. Casey to vice Admiral Poindexter enclosing a proposed
Finding which I'd like to have marked as Exhibit 10.
(The document referred to was
marked Allen Exhibit Number 10
for identification.)
A I was aware, I believe, that something was under
405
iwetAsstfifD
way as a result of Mr. Clarridge's statement, and I sort of
termed it a mini-Finding, and that term apparently persisted.
At the time, though, I did not pursue it. I did not obtain
any additional information. I recall, however, I believe
that Mr. Makowka was involved in trying to prepare something
that would have been a Presidential Finding to support future
action as well as ratifying past actions.
Q with regard to Exhibit 10, have you ever seen that
document before?
A No, I have not seen it before. I've heard about
it. Mr. Makowka has described it. He described it in the
November 1986 time frame when I raised the issue of a mini-
Finding. I was told by Colonel North that a mini-Finding
doesn't exist, because nothing was ever signed.
Mr. Clair George stated that it did not exist to
me, I believe in the November 1986 time frame.
Q You are aware, are you not, that Mr. McMahon
prepared a memorandum for the record on this incident dated
December 7, 1985?
A Yes, I am aware of it.
Q Have you had occasion to read that memorandum?
A I have read it, I believe, yes, but I'd have to
look at it to make sure it's the same memorandum that I
recall reading.
Q Well, let me show it to vai^fMid I specifically
406
DNeWSSfflED
172
direct your attention to paragraph 3 , although you are
welcome to read the rest of it as well, but I'd like to have
the memorandum of December 7, 1985, marked as Exhibit 11.
(The document referred to was
marked Allen Exhibit Number 11
for identification.)
(Pause. )
A I've read this before. I'm aware of the
memorandum .
Q Does reading the memorandum now give you a. fuller
recollection of the )cnowledge that you had on the 25th and
26th of November of the acts of Mr. McMahon with regard to
getting a Finding?
A Not in any great detail, only what Mr. Clarridge
had told me, that the General Counsel was involved and that a
Finding might be required, that Mr. McMahon was upset at what
had occurred over the weekend.
Q You were aware, were you not, at that time that
Mr. McMahon was seeking a Finding that would be retroactive,
that would bless what had occurred on the 23rd and 24th?
A That was my understanding, that it would bless
what had occurred.
Q Now with regard to the responsibility of keeping
track of what had happened on the Finding, bird-dogging the
White House, if you yill, there's an allusion to Mr.
407
173
McMahon's interest in finding out what had happened with the
Finding in this memorandum?
A That's correct.
Q Is it not a fact that you and Mr. Clarridge had
the responsibility of checking with the White House,
specifically the NSC, to determine whether or not that
Finding had been signed?
A No, sir, that is not a fact. I can't speak for
Mr. Clarridge, but no one ever asked me to pursue this issue
with the National Security Council staff, with Colonel North
or any of Colonel North's superiors to determine whether this
has been signed or not.
Q Specifically, Mr. McMahon, to the best of your
recollection, did not task you with the responsibility of
finding out what happened with the mini-Finding that you've
described?
A To the very best of my recollection, Mr. McMahon
never tasked me to pursue this with the NSC.
Q And you did not in fact pursue it?
A No, sir.
Q Did Mr. McMahon ask you to pursue it with anybody
else on whether or not the President had signed this Finding?
A To the best of my recollection, I can't recall Mr.
McMahon ever asking me to do that.
Q And with jregard to Exhibit 10, which is what you
ICB
408
ietASSIHED
characterize as the mini-Finding, it continues to be your
best recollection that you have not actually seen that
document before; is that right?
A To the best of my recollection I don't recall
seeing it before. I don't recall seeing that specific
Finding. As you know, on the 24th of December there was a
conversation in Room 392 of the Executive Office Building
with Colonel North, Bernie Makowka and myself. That
conversation almost certainly alluded to this draft
Presidential Finding.
Q It alluded to somethijMN^^^iat'B a Bontli:^t«r,
December 24, 1985, and we've got a long way to go to get
there .
A I know. I keep moving you along.
A I know, and I sympathize with you, but let me turn
it over to my colleague, who has more questions on the
weekend of the 23rd.
EXAMINATION ON BEHALF OF THE HOUSE SELECT CO^iXTTEE
BY MR. VAN CLEVE:
Q If I might, just a couple of brj^ef m^i^^ons to
fo^tOW J4P on what Mr. Kerr has been asKing about, ^ihg baek
to the morning of Saturday, November 23. Could you please
explain why it was necessary for Colonel North to get you to
vouch for his request to Mr. Clarridge with respect to —
A I can't ^n^y?"^ that question. Colonel North will
Isfci
409
mmmm
175
have to answer it. He simply stated it, that he wanted Mr.
Clarridge to feel assured that there was an important
initiative under way relating to the American hostages in
Lebanon, that this is one very tangible way of demonstrating
to Mr. Clarridge that something had been under way for a
number of weeks. But I can't answer that beyond what Colonel
North explicitly told me.
Q When you arrived at the CIA and found out that Mr.
Clarridge had been asked to supply the name of a reliable
charter airline and get some landing clearances
were you surprised at the nature of the request? Was that an
unusual request?
A Well, it was not something that occurs every day
because the destination of the aircraft was Iran.
Q To your knowledge had Colonel North ever made a
similar request to you or to Mr. Clarridge previously?
A I can assure you he'd never asked me for that.
Q How about Mr. Clarridge?
A I've never heard that -S» «9ked Mr. Clarridge any
type of rec[uest of that nature in the past.
Q I take it, then, that it's fair to say this was a
relatively unusual request. It came up on a Saturday
morning. It was represent«I"l^Btt^^liat this is something
the White House wanted to get done and so forth.
A Well, I (jQQ'.t-know. You know, you are
Bn't know. You know, y
teSSIflfD
410
UNWSIFIEO
176
characterizing it as unusual. The fact that it was a White
House request and that the White House was involved in what
appeared to be operational activity was not a norm, and I
don't want to characterize it in any way. It did not shake
me to the roots by any means. The Agency has done a lot of
things over the last 30 or 40 years.
Q I think we're all aware of that. Did it occur to
you that there might be a question about whether or not the
CIA could legally comply with Colonel North's request?
A I did not address that issue with Mr. Clarridge
orally at all. Mr. Clarridge is a very senior officer of the
Directorate of Operations. Mr. Clarridge clearly would
understand when he has to obtain authorization from more
senior officials to conduct activity of this nature, so I did
not question.
Q So it did not occur to you that there might be a
question?
A No. I did not question it. And I did not dwell
on it.
Q I believe that you told us that when Colonel North
stated emphatically that the cargo for the shipment was oil-
drilling equipment that you had serious doubts about whether
or not that was a correct statement. M
A I had reservations.
Q I believq argvi^iaedfti^^bBaf^ serious doubts about
mmmi
411
(IHttWB
177
five minutes ago. Would you like to stay with that?
A I had serious doubts.
Q Thank you. Would you please explain why you did
not raise the question with Colonel North about whether or
not that was a correct statement?
A As I explained to Mr. Kerr, there were many gaps
in my knowledge relating to this initiative. I had only
certain parts of the effort. Clearly this was an initiative
of unusual sensitivity involving senior officials of the
Administration, and almost certainly the President.
Therefore, there might have been reasons why Colonel North
did not wish to speak more explicitly about the cargo.
So I did not challenge him directly on it at all.
Q Suppose Colonel North had told you that in fact
HAWK missiles were being shipped.
--__^^--^T^Thl$;lq_iOJfe*^g5'^^^B|ps^i°" • He didn't do
that.
Q That's right. Pardon?
A He didn't ask me that.
Q I'm now going to ask you a hypothetical question.
Suppose Colonel North had told you directly that HAWK
missiles were being shipped. Would it have made a difference
to you or Mr. Clarridge?
A That's a hypothetical question. I can't answer
it.
mMM
412
l)N6tAS«D
178
Q I think you can answer the question. I just made
it clear it is a hypothetical question, and I'd like an
answer. Suppose you had been told on the morning of November
23, 1985 that HAWK missiles were being shipped. Would it
have made a difference?
A I'd have to know who was shipping them, from what
stocks, what were the legalities involved. That was a
different equation and I wasn't asked that, so I can't
respond to your hypothetical question.
Q I think you just have. I think the answer you
have just given is that it would have made a difference in
the way you handled the request.
A I can't answer it beyond that.
Q I think now I'll just ask you a question I think
calls for a yes or no answer. Would it have made a
difference to you in the way you handled the request if you
had been told that HAWK missiles were being shipped?
MS. MC GINN: That's the same speculative question
you just asked him.
MR. VAN CLEVE: I made it clear to the witness
it's a speculative question.
THE WITNESS: It is speculative and that didn't
arise. I had a National Security Council staffer who made a
telephone call in my presence to the Deputy National Security
Advisor stating that this was authorized, appropriate,
?ol
413
UNeWFIED
179
proper. I had no reason to question him or confront him
directly because there were so many un)tnowns about the
initiative at that time. In December I knew much more about
the operation and in January 1986 I knew many detailed
parameters, but at that stage it was being handled at the
White House level and I am certain Mr. Clarridge had only
fragments of what was occurred.
BY MR. KERR: (Resuming)
Q Why are you certain of that, sir?
A Just based on the way he spoke to me that morning,
the fact that he was surprised!
I think I'm not going to speculate further. But
I think that I only knew certain elements of that and at that
stage I didn't feel that I could challenge Colonel North on
this issue.
Q Did Mr. Clarridge ever tell you the state of his
knowledge at that time — any time up until this morning?
A He indicated to me that morning!
that this was something that was clearly under way
at the White House level.
Q Have you had occasion to talk to Mr. Clarridge at
any time up till five minutes ago in which Mr. Clarridge
indicated to you the amount of knowledge that he had about
this transaction when the transaction was occurring?
/hen the transaction was c
414
Ji dc^ti recall that ffir. Clarrl^c
180
' A" Ji d«Mt recall that Mr. jpiarriage, based on what I
know of Mr. Clarrid^, htf had no knowledge of this initiative
until hS: was~ ai9ced ?Ee=:^ssist Colronel North~'^&. finding a
proprietary charter airline that week in November.
TBPL^ We'll go into what it is that you conclude later,
but have you ever had a conversation with Mr. Clarridge in
which he has indicated at any point in time how much he knew
about this transaction on the 2 3rd and 24th of November?
A No, he has never indicated that he Scnew any more
prior to that date than what he told me that morning. •
Q Has he ever indicated since that time, up until
today?
A No.
Q What his state of knowledge was?
A No. He has never indicated that he knew anything
in addition to what he told me that morning on the 23rd of
November 1985.
Q And he has never indicated to you at any time that
he was aware of a cable out^^^^^^^f indicating on the 23rd
of November that the cargo in question was going to be HAWK
missiles?
A No.
Q Do you kno*
A Yes.
Q Have you ever had occasion to disbelieve something
DNCttSSfflED
415
,has told you?
A She's a very reliable employee of the Central
Intelligence Agency, to the best of my knowledge.
Q Do you have any understanding or knowledge of the
basis for her conclusion that you and Mr. Clarridge had the
responsibility of seeing whether or not this November 26
Finding was signed?
A No.
Q If that is her perspective, it is inaccurate from
your perspective; is that right?
A I was never told by Mr. Casey or Mr. McMahon or
Mr. Sporkin or any other senior official of the Agency that
it was my job to pursue the so-called mini-Finding to ensure
that it was signed.
Q Mr. Allen, you try to be a careful man. I don't
care if the janitor told you, but did anybody at the CIA or
within 200 miles of the CIA tell you to check out this
Finding to determine whether or not it had been signed?
A Never, no one. And this was my first knowledge
that anyone would assert that I ever had the responsibility
to undertake that activity. I did not. I never pursued it
with Colonel North, with Admiral Poindexter or with Mr.
McFarlane or any other official.
Q Do you have any knowledge today as to why the
document that we've looked at ^4£aV<tti ^3|<ibit 10 was not
m
416
UNwsife
signed?
A I don't know why it wasn't signed.
Q Have you ever had a conversation with anybody in
which a decision was made for senior CIA officials to tell
those outside the CIA that they did not )cnow the nature of
the cargo of this aircraft until January of 1986?
A I need that question repeated.
Q Let me try to do it better. That might be a
better way to do it. Has it ever come to your attention,
sir, that CIA personnel concluded that they should tell folks
outside the Central Intelligence Agency that Mr. Clarridge,
yourself, for example, did not know that the cargo of this
aircraft was weapons until sometime in January of 1986?
A I don't know why senior officials — let me
respond to that this way. By the 26th of November 1985,
^^^^^^^^^^^^^^^^^^^^^^^^^^^^1 it arms were
involved. The nature of those arms, the specific types of
those arms was uncleat.* ^,^^ ^--=- ^^v-rr -^f^^
-:^^~ ^^ 13_ January 1986, Manucher Ghorbanifar sai^ tSat
it involved 18 HAWK missiles on the aircraft and that the
United States charged four times t^i^ go^jB^ g«ic(^ £o r those
missiles. So to the best of my knowledge the specific cargo
I did not know until 13 January.
Q Do you have any knowledge of a decision being made
by or among CIA personnel that if asked by folks from outside
ONElilBSlflED
417
UNEi4S$lfe
183
the CIA when the CIA )cnew of the cargo of this aircraft that
they would reply that they did not know until January of
1986?
A When we were preparing the Director's testimony
the question came up in trying to reconstruct the chronology.
Mr. Casey was there, I believe, and we all tried to
reconstruct those days back in November and December, and no
one, to the best of my knowledge, could actually at that time
— that was about, and I'll have to get the date, but that
was the week that the Director put together his testimony —
no one could remember specifically that the cargo was
actually 18 HAWK missiles until the January time frame.
Now I didn't know it was anything. I did not know
it was HAWK missiles until 13 January 1986.
Q Well, let me come at it another way. Do you have
any knowledge of anyone at the CIA concluding that because
there was no Presidential Finding signed until on or about
January 17, 1986, that it would be imprudent for CIA
personnel to say that they knew about the content of this
plane in November?
A I know of nothing relating to that. If I or
anyone else had expj^<^t_ jjjj<3?7T|i*^ '^Sij-^i^'^^^^" ^^ would
have testified to that. ~~ "
BY MR. VAN CLEVE: (Resuming)
By the same token, if Oliver North had told you
Q
mmmm
82-688 0-88-15
418
184
that HAWK missiles were being shipped, I take it that you
would not have complied with his request without a Finding;
is that correct?
A Well, I was not responsible for provision of the
proprietary airline to Colonel North and to Major General
Copp, also known as Secord. I simply provided the
intelligence that had been collected. So I don't think that
was my role. My role was to task, collect intelligence and,
s
from time to time, asses what that intelligence meant.
BY MR. KERR: (Resuming)
Q I'm about to shift to another area, so if you all
want to break, we can do that or we can plunge ahead and see
where we go for another fifteen minutes.
A What time are we finishing?
Q I think I made a commitment to quit by 5:30 at the
latest.
A Why don't we hang on for 15 minutes?
Q Let me give you a slightly different focus. You
met in late November with Michael Ledeen, did you not?
A I met with Michael Ledeen and, I believe, the
November time frame, with Mr. Clarridge where he provided
some intelligence on alleged Iranian terrorist networks in
Western Europe. At that stage he refused to reveal the
source of that intelligence. We ran some name traces. He
gave us a photograph that he had obtained from his source of
419
Q All right. Let's try to pin it down vis-a-vis the
aircraft. Did you meet with Mr. Ledeen before or
after that flight from Tel Aviv to Tehran?
A I don't know.
Q Would you have any records in your possession that
would show when you would have met with Mr. Ledeen in
November of 1985?
A It's possible.
Q Could I ask you all to check on that between now
and Friday?
A That's impossible. The Independent Counsel has my
files.
Q He's got your calendar, too?
A Yes, he has everything. He's had it for six,
eight weeks.
Q He should have it memorized by now. We'll see if
we can talk to him about that.
In terms of the way that meeting was set up, how
did it come about, your meeting with Ledeen?
A I believe Mr. Ledeen called me and stated he
wanted to come out to the Agency in his capacity as a
consultant to the Niflflpfi^cpuiiterterrorism, that he wanted to
IS]
I
420
Slcfll^dbin^t)!! 186
meet with me and Mr. Clarridge because he had some
operationally sensitive intelligence on Iranian terrorist
activities in Western Europe, and we met in Mr. Clarridge's
office.
Q your recollection would be that Ledeen called you
direct rather than Morth or someone on North's behalf?
A That's my understanding. We're talking about the
November meeting.
Q Yes.
A Which I cannot pin down specifically.
Q Well, let me ask you to take a look at two
documents which have been identified to us as documents that
came into your possession in November from Ledeen, at least
CIA has told us that. The first is an undated document.
It's R-C219 and C220, which will be Exhibit 12.
(The document referred to was
marked Allen Exhibit Number 12
for identification.)
The second is a document with Senate number C-230
to 241, which we've also been advised by the CIA came into
your possession from Ledeen in November 1985, and that will
be Exhibit 13.
(The document referred to was
marked Allen Exhibit Number 13
Lcation. )
iwetftSM
421
mmmi
187
If you'd look at those two documents and identify
them for me, if you can, Mr. Allen, and we'll talk a little
bit about them.
A Ah-ha. Why don't we talk about C-220? That one
came to me first. Now this one I believe came later. I
don't believe this was obtained in November and I think CIA
is absolutely inaccurate in that.
Q It's hard to believe, but we'll come to that in a
moment. Let's deal with Exhibit 12 first.
A Let's look at Exhibit 12.
Q Exhibit 12 is a document you recognize?
A Yes.
Q And it's a document that came into your possession
in November of 1985, correct?
A Yes. I gave a copy to Mr. Clarridge as well.
Q And you would have gotten this document at the
time that you met with Mr. Ledeen?
A Yes, I
Q Did Mr. Ledeen provide you with any other
documents at that time apart!
A I don't believe so.
Q So the only document with writing on it that you
recall receiving is what is now marked as Exhibit 12?
A That's my understanding
i S
422
s
188
Q The style of this document is, in the gray ways of
lawyers, somewhat flamboyant. Was this your understanding
this was Mr. Ledeen's work or the work product of someone
else?
A I believe this was Mr. Ledeen collecting this from
his source and writing it up.
Q And if I'm understanding you correctly, Mr. Ledeen
declined to identify to you all who the source was; is that
right?
A At the time, he did not identify the source' to
either Mr. Clarridge or to me.
Q Did he characterize who this person was, an
Iranian?
A He just said he was a reliable source.
Q A reliable source. He didn't say his nationality,
background?
A He said he was an Iranian who was a reliable
source. So Mr. Clarridge ran some name traces, as I recall
on these individuals.
Q So you ran name traces on the names that appeared
in the memo?
Um-hum^^^^l^^^^^^^^^^^^^^^B on whom there
was probably something in the files, and I thi?
1 1 don't believe we found anything on him.
Q Help me a bit in terms of what Ledeen was telling
423
unssn
189
you. Why did Ledeen say that his source wanted this
information to be brought to the attention of Central
Intelligence Agency?
A Well, he didn't say that.
Q What did he tell you?
A Mr. Ledeen stated that he had obtained this
information from an Iranian in Western Europe, that the
information he felt was pertinent to the Agency's
counterterrorist mission, and he was bringing it to our
attention for possible follow-up operational activity.
Q Did he tell you that he had obtained this
information while he himself was in Western Europe?
A Yes, I believe he did.
Q Did he tell you when he was in Western Europe?
A I don't recall that he did.
Q Do you recall where in Western Europe that it was
that he had this meeting?
A No.
Q He didn't mention Switzerland, by any chance?
A I don't think — to the best of my recollection, I
don't think he specified where he collected this.
Q Do you know today where it was that he got this
information?
A I don't know where he obtained it.
Q You do know the source today?
424
UNGUSSm
190
A Yes, I do.
Q Manucher Ghorbanifar?
A Manucher Ghorbanifar (its the soutbe of this
intelligenos.
Q But where did Ledeen acquire this information?
You don't know that?
A No, I don't know that.
Q Did Ledeen indicate to you in this initial
conversation that you and Mr. Clarridge had with him the
extent of his familiarity with Mr. — with his source?
A No, he didn't describe the source in any detail at
all, except that he did not want to provide the name because
he stated that the source was a very delicate one and that he
did not feel comfortable with providing the information to
us.
— -.^^^^^^SJ^^^Pmi^S^^^B at that time that this
delicate source had had prior relationships with the CIA?
A No.
Q All right. Apart from what is related in the
memorandum itself and what j^':j^^ta£d ^» afliiSgg;"%^t Mr._
TninnifliimMBIBUT timr tTn aoapiired tfris infgaftttlon,
lis Beeting?^
A What else? I don't recall anything else. They
exchanged cigars because they both smoke cigars, but other
Ise
425
Ul^L^dlfltt)
191
than that '^T'can't recall anything.
Q Was there any writing made of what transpired at
this nesting?
A I don't think so.
Q You did not prepare any kind of memorandum?
A No.
Q Would you have prepared in any handwritten notes
on this meeting?
A Well, if I did, it's in the hands of the
Independent Counsel.
Q Now with regard to the other exhibit that we
looked at, that docuiii^t^^"$W|^jaa# r«^n i z e ?
A Yea^ ThtS-UBSI^cteculWBft^^hat Mr. Ledeen pulled
together based on information that - ha^ WitP provided to him
and it's my belief that he probably put this together in the
December time frame, not in the November time frame.
As you know, Mr. Kerr, there was a meeting between
Mr. Ledeen and myself on the 3rd of December, first with Mr.
Clarridge and Mr. Ledeen and myself, and then Mr. Clarridge
stated that since this was so focused on this Iranian
initiative and the factions within the government that it
would be best that I meet with Mr. Ledeen and prepare a
memorandum on just all that Mr. Ledeen had to transmit.
It was at that meeting Mr. Ledeen identified
Manucher Ghorbanifar.
moffltfifD
426
mm^m
192
Q My recollection is that the meeting was on
December 4 as opposed to December 3 from your memorandum.
A Well, you have an advantage.
Q We'll show it to you in a minute, but in terms of
the document that's Exhibit 13, it would be your best
recollection that you would have received that document at
the meeting on, by your memo, December 4; is that right?
A Well, I'm not certain when I obtained the
document. Mr. Ledeen either in the November meeting or the
December meeting stated that he believed he had insights into
the factional alignments within the Iranian government. I
know that Mr. Clarridge stated it would be helpful if he
could put this down in some form. Mr. Ledeen indicated that
he had obtained this not just from his source, Mr.
Ghorbanifar, but that he had had discussions with some
interesting Iranians, including a very senior Ayatollah.
And I believe I and Mr. Clarridge said if you
really wish to be useful in providing us with insights, put
this down in some coherent way, because each faction has
various groups within it, that this is a very complex and
poorly understood issue within the U.S. intelligence
community.
Q With regard to this document, though, it was
delivered to you by Ledeen himself; is that right? It didn't
show up in the mail |ane^c|ay?
Wi^L^^MO
427
193
A It was given to me at some point by Mr. Ledeen. I
can't recall where and when.
Q That's really the problem.
A Well, I can't help you. I recall that Mr. Ledeen
was expounding information on the factions within Iran. I
believe Mr. Clarridge said, look, for this to be helpful,
it's got to be put in a coherent framework and that was what
Mr. Ledeen did. He went to his home, he took his notes, and,
as I understand it, labored away to produce this document.
Q And he told you that he labored away, correct?
A That's correct.
Q You weren't there where he was laboring away?
A No. I only have his word.
Q How many meetings did you have with Ledeen in
December 1985?
A I think only one.
Q Right, and that was on December 4, right?
A You say December 4, so I take your word for it.
Q Well, I'm taking your word for it, frankly.
A Well, you have the advantage, as I said earlier.
Q And I'm a great believer in your word, Mr. Allen.
It looks good to me. So if there was only one meeting and it
was, according to your memo, on December 4 and you did
receive this in December, you would have received this at the
December 4 meeting;
yii^HD
428
«
WsfjtJJffff//
194
A It seems likely.
Q Before we go into the rigors of the December 4
meeting, it is 5:30. I'll let you all get out of here.
A The rigors of the December 4 meeting; that's going
to be interesting.
MR. KERR: See you all at 9:00 on Friday.
(Whereupon, at 5:30 p.m., the taking of the
instant deposition recessed, to reconvene at 9:00 a.m.,
Friday, April 24, 1987.)
W^SSfFfffi
429
HEARINGS HSlTS_^^?:?. /87
Before the
SELECT COMMITTEE ON SECRET MILITARY ASSISTANCE
TO IRAN AND THE NICARAGUAN RESISTANCE
UNITED STATES SENATE
TESTIMONY OF CHARLES E. ALLEN - Continued
Friday, April 24, 1987
'II
Partially Declass;r,:d/r,de3S3d on M^
under provisions of t.O. UJOo
by N.Menan. National Security Council
W5ishingTon, D.C.
UNII0S$IR»UpUStlfltl)
OOPY NO /a OF — ^ —
.COPIE
ALDE^SCN REPC'fiT'NG
(202) 628-9300
20 F STREET, N.W.
WASHINGTON, D. C. 200 01
430
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16 he
17
TESTIMONY OF CHARLES E. ALLEN - Continued
Friday, April 24, 1987
United States Senate
Select Committee on Secret
Military Assistance to Iran
and the Nicaraguan Opposition
Washington, D. c.
Continued deposition of CHARLES E. ALLEN,
called as a witness by counsel for the Select Committee,
at the offices of the Select Committee, Room SH-901, Hart
senate office Building, Washington, D. C. , commencing at
9:12 a.m., the witness having been previously duly swcirn
by MICHAL ANN SCHAFER, a Notary Public in and for the
District of Columbia, and the testimony being taJcen down
by Stenomask by MICHAL ANN SCHAFER and transccibed under
UNOASSra
431
mmm
196
1 APPEARANCES :
2 On behalf of the Senate Select Committee on Secret
3 Military Assistance to Iran and the Nicaraguan
4 Opposition:
5. CHARLES KERR, ESQ.
6 TIMOTHY WOODCOCK, ESQ.
7 On behalf of the House Select Committee to
8 Investigate Covert Arms Transactions with Iran:
9 DIANE DORNAN, ESQ.
10 On behalf of the Central Intelligence Agency:
11 KATHLEEN A. MC GINN, ESQ.
12 RHONDA M. HUGHES, ESQ.
13 Office of Congressional Affairs
14 Central Intelligence Agency
15 Washington, D. C. 20505
16
UNCttSStFtEi)
432
mimm
197
1
C
0 N
T
E
N
T
S
2
EXAMINATION
ON
BEHALF OF
3
WITNESS
SENATE
HOUSE
4
Charli
as E. Allen -
Resumed
5
By Mr. Kerr
198
6
7
AFTERNOON SESSION,
?■
297
8
E
X H
I
8
I
T
S
9
ALLEN
EXHIBIT NUMBER
FOR
IDENTIFICATION
10
14
204
11
15
211
12
16
220
13
17
231
14
18
242
15
19
261
16
20
280
17
21
282
18
22
282
19
23
314
20
24
314
21
25
317
22
26
319
23
27
323
24 28 342
25 29 352
UNtASSffl
433
!WI
198
1
2
ALLZN EXI
3
30
4
31
5
32
6
33
7
34
8
35
9
36
10
37
11
38
12
39
13
40
14
41
15
#'
16
-^
17
it
18
45
19
46
20
47
EXHIBITS (Continued)
TOMBER FOR IDENTIFICATIOK
353
355
356
359
365
383
388
393
393
400 ^
406
409
433 ^
'^^^'•^'- 449 '^._^
449
450
454
463
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UNCLASSKe
199
1 PROCEEDINGS
2 Whereupon,
3 CHARLES E. ALLEH
4 called as a witness by counsel for the Senate Select
5 Committee, having been previously duly sworn by the
6 Notary Public, was further examined and testified as
7 follows:
8 THE WITNESS: In the discussion last Tuesday
9 you asked a number of questions about a program that I
10 was involved in as a senior manager between 1981 and '85.
11 I had two positions — first as directly responsible to
12 Mr. Carlucci and Admiral Inman, and then I worked in the
13 Department of Defense, OSD.
14 I have been authorized to tell you that^^^H
^^^^■^■[^^HHIIH^H|m^^^nd that if
16 important that information be derived about the program
17 that it has to be discussed with Senator Boren on the
18 Senate side and Congressman Cheney on the House side.
19 Both of those individuals are aware of the program. At
2 0 this point it's my understanding that no staff members on
21 either the House or Senate Select Committees on the Iran
22 affairs are accessed to the program and that there's no
2 3 intention to access any of the staff.
24 EXAMINATION ON BEHALF OF THE SENATE COMMITTEE -
fillTOffi^
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Q With regard t»^«oi^wft«r that we discussed
when we last talked, Mr. Allen, are there any other
matters that you'd like to correct or amend or amplify
on? You've had a couple of days to think about things,
and I believe you may have had a chance to go through
some additional doasaents since you and I last talked.
A There were questions asked by Mr. Liman, I
guess, about knowledge of a certain activity relating to
June and July 1985 involving Colonel North and two DEA
agents. I have no knowledge of that particular
operation. I do, I believe, hav« ^^ocument that we have
found in my files dated January 1986 in which an officer
who worked for me was requested by Colonel North to
travel with the two DEA agents in question.
to their capabilities
or access to individuals that might have ways to free
American hostages in Lebanon.
I believe Miss McGinn here is willing to
submit the memorandum that^ I found in my files, in my
Hostage Location Task Force files, to you at this time.
MR. KERR: Super. Thank you very much.
MS. MC GINN: We just have to get somebody to
sign for this. Vou can take a look at it right now.
(The document was handed to Counsel.)
436
UNtUSSWiD
201
1 THE WITNESS: I believ« th« last question that
2 you had asked me when we ended our deposition on Tuesday
3 was the date when I met Mr. Ledeen, and I have checked my
4 file and I believe you are correct. It is 4 December
5 1985.
6 BY MR. KERB: (Resuming)
7 Q Thanks. Bear with me a moment while I glance
8 through this memorandum. The memorandun that's been
9 provided to us is a memorandum dated January 15, 1986.
10 It's a memorandum for the record, subject Trip Report;
11 It bears CIIN 2799 as its number and it appears to be
12 written bi
13 (Pause.)
14 When I get to January 15 and that period of
15 time
16 — and, believe me, we wil-l gtf^&et^nt^atiud^i^- I'll
17 tarry on this thing. We'll look at it a little bit more
18 then.
19 .Mrir^j^en . ^^^^m ay tmdera^imll^^^hat between
20 th« l^st^^m^ v«^«TSM^nd now some documents were
21 located by the CIA that apparently are a box of your
22 notes and some other documentation that hadn't been
23 provided to us yet. I was called about it yesterday and
24 was not able to get 'over and take a look at the documents
25 they found. i
WLASSIPIED
437
P ffECRfeTTtOBStJbSlT'"^ 202
1 Have you had a chance to go through that box
2 in the last day or so?
3 A This was a box of materials that were sent to
4 the Independent Counsel six weeks ago, I assume, at least
5 six weeks ago. I had not had a chance to review them
6 because they had been retained. I asked for them back.
7 They are in my office now. Very candidly, I've not had a
8 chance to go through them. I looked at just one small
9 file last night briefly. They are available, of course,
10 for your inspection.
11 I will be gone for one week, and if you have
12 questions on thos^fr- and -Mp|£lon-^fiBL yeu. pasBbably vdll
13 bJicause tha;^ involve just a lot of -Itendwri^en notes out
14 of notebooks that^ X ^and^t^lce^ — I wouiiiS^'ltt^i^llable
15 af t^t one we^ to^^talk Airliiwr about^SRfiB^ '" -:^^- -^ ' W
16
17 havs 3^ P^BpiyhricJEB^ ^tin^^c>t«r ^g^t^l'^^ ^ ^' "^
18 1^1^ Netss. WOff ^ £~ th*.. discuMnfe* in^&at box are
19 already in. tbiL possession 1^ the Sen^» Select CovsiXttm'
20 because many o^ th4||s.J£» Jia«t_dupi4ifli|HJjB'og dspoumsnts
21 already furnished to you. Unquestionably there may be
22 some notes, an odd piece of paper, here and there that
23 you have not seen. But my secretary has them and you
24 certainly can look at them at any time.
25 Q Thank you. We had ended at about December 4.
DNEiissira
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We were about to start talking about a meeting you
attended with Mr. Ledeen. Before we do, a couple of
matters had come up as a result of some documents that we
received at the deposition of^H|^^^^H that I wanted
to touch base with yovLon.
If I understood your testimony correctly, you
indicated that you did not know Mr. Ghorbanifar's actual
identity until you met with Mr. Ledeen on 4 December; is
that correct?
A That is correct. I personally did not know'
his identity.
Q In terms of the identities, were you aware •
that Colonel North had asked the Central Intelligence
Agency
A No, I did not know that.
Q Has that come to your attention subsequently
In late October 1985?
land I did not know!
knew that Mr. Ghorbanifar was in this country^^^f course,
in early October, so it's quite likely that Colonel North
could have for^HIH^^^^^H without
knowledge, because my role was to collect intelligence,
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DNMSIFiED
204
not to involve myself in direct operations.
Q Let me show you a series ot cables and some
Xerox copies ^^^^^^^^^^H that were given to us the
other day under cover of a letter dated April 22, 1987,
Senate numbers C-62 67 through 6297. It's not necessary
for you to spend a lot of time with them, unless you want
to. But I'd like you to take a look at them for a two-
fold purpose — one, to tell me if you've ever seen the
documents before. Beyond that I'd like you to tell me if
it gives ^you any further refreshed recollection of
knowledge you would have had at the time that the events
descr^^a in the documents were taking place.
They will be Exhibit 14.
/gfThe document referred to wa^f
Kti9b«;^4
A
seen thtfB.
Q -^ With rt^rd Mr^^^^ ^»^**^^t*^^
theril, l«t^(r:^row JUt a flir ni^«.jM»„o
that" com* fi»m rttc«rk^-
have "any kso^^Nn^^BK/Un
t»^M.|#-,^ ^-v-^
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As the cables indicate,!
They were hand-delivered back to Washington, D.
C. approximately November 5 and^^^^^^^^^Hindicated
that he took ^^^^^^^^^|^B himself over to
North and met with Colonel North, at which tin* — and
frankly I think it is indicated on th« cabla which is
Director 610726 — North identified one of the people!
|as Manucher Ghorbanifar and the other '
person was determined to bel
North, as an aside, apparently had]
[confused, but he had the right names,
went back to^^^e shop, did a trace on the names, and got
a hit on the GhorSaniSr ftfe. He wasn't clear on what
he got on th^^mmfile. As I understand from
testimony that was given by Mr. Juchniewicz yesterday,
Juchniewicz was apprised of what was in the Ghorbanifar
201 and, according to Mr. Juchniewicz and what he
recalls, he asked^^^^^^^H to apprise Colonel North of
the fabricator notice, the basic background on
Ghorbanifar at that time, which would have beiit tl** first
we^C£^ )•« of November 1985.
Were you privy to any of those events at that
time?
441
IINGIASHD
206
1 A Not at all.
2 Q So as far as you knew, in early November
3 Ascari was still an unknown?
4 A That's correct.
5 Q And you didn't link him up to anything at that
6 point?
7 A And Colonel North did not tell ma that he knew
8 that Ascari was clearly Manucher Ghorbanifar. H«
9 continued to keep me in the dark on that as part of his
10 compartmentation efforts on the project. That's not
11 unusual. Unfortunately, sometimes compartmentation
12 hampers actual intelligence operations. '^
13 Q You must have been talking to North, though,
14 from time to time during this period in November.
15 A I talked to .h4a^vi^ day, but you must
on this|^^^^^^^^^^^^^^^^^^^Hx
17 would call and brief it to him because my copy was always
18 delivered to me by courier before either Defense or the
19 White House,]
20
21 But ^tal)^||pL<^N<^tfh ffi) -ttii|«8s things
22 because I was focused on worldwide terrorism.
23 Q That was my impression. Your turf arri^sfeg?'
24 crossed paths a great deal, I would think, and you would
25 have been talking to each other a lot.
uimssra
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A I talked to him numerous times every week, and
I saw him every week for the last several years.
Q You would have been talking about this
project, at least intermittently, in November?
A That was correct.
Q Did you have any sense that he either knew or
did not know the identity of Ascari?
A He never offered that he knew who this
individual was.
Q I'm really going beyond what he said.
A I had no sense that he knew that. He did not
Q Let me just pursue that a little bit further,
though. It's curiosity as to what the CIA's information
systems were reporting back. Do you have a recollection
of name trace product or^^^^^Hf in November, what it
was showing you that you all knew about
wBtmm
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A wa had run, as I think you r«call, bacJc in
September traces onm^and th«r« was a v.ry limited
amount of intelligence, and even in 1986, when this
became a prioritv^^^^^^^^^^^^^^^^ .i.
^ ^^^'^^^^^^^^^^ at my request, levied
a list of requirements on
It was a very extensive list. I looked at it
and said this is fr«at, an4 sh« s«iaEJ.t to th*
Directorate of Operations.
So even by early 1986 our amount of knowledge
°"^^^|''as' as I recall, fit on on* pag*.?.
% ft-s^=-Tl»t*-ior»j|g|, puzzles ma, Mr. Allan. That's->why
I want to pursue it, because I'm not sure what wane awry
hara-g^ Wa kno|f ^^ tha, cahla. that wa saw the other day
that there was a substantial amount of cable traffic and
the like on the Cyrus Hashemi connection ta||^H|H|^H
Manuchar Ghorbanifar that I gather didn't make much of an
impraaaitfb- on you, even if it was turned up, and I ittdn^
— -ij^- —
gat a clear impression of whether it was tumad up.*^ ^
Did you all know that there had been this
Shaheen to Casey inqtitrjg&that has resulted in the
identification of Manuchar Ghorbanifar |^^H^H|as
wanting to do something for the hostages in June and July
of '85? ■ r^
A I had not heard of Shaheen and Mr. Casey did
UNGtltSSinED
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not enlighten me at that time.
Q And when you did the trace it didn't trigger
that paper history is what I'm really asking.
A There was a very limited amount of
intelligence^^^^^^^^Hthat I saw as a result of the
trace, a very small amount.
Q So in November of '8|^~ - ^,. v^'
A And could Z jul^t^ntii|M«t. 2; knov that Mr.
Cave and I talked abovt thir lack of^^Bif oraatiten on
and Mr. Cave kept saying well, I can't
understand why we do not have more intelligence on
That must be another alias. It must be
someone else in the Iranian government. And I remember
But what troubles me is that the prior
UNCtlBSIftED
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IGUWftO
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ov«rtur« didn't pop and you have no recollection of
having a conscious awareness in November that there had
been this overture from Manucher ghorbanifarfl|^^^^^|B
in June and July of '85 relating to exchange of weapons
for hostages.
A ifo, sir, { know nothing of that.
Q In terns — one the things^^^^^^^^lsaid
in his deposition, which I really hadn't focused on
before, is that you all don't have direct access — "you"
being th* 4|itel|^9fnce a^k — to th« 201'T$ype fi.r«
material that the Directorate of Operations has; is that
correct?
A X did as Chief of Intelligence ir
^^^^^^^^^^^^^^^^^H but the time was a
of^^^^^^^^^^H^f^^^H. the authority to
have the Directorate of Operations search their files for
intelligence, and I exercise that authority from time to
time.
Q Do you recall this instance when the Ascari
name came up whether you gave that kind of task to the
Operations Directorate?
A I had the Office, I believe,!
the analysts who came in on the night of the
13th, and I believe they pursued it even the next week,
have traces of the names run through the Directorate of
UNCtASMD
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211
Operations. So yes, the name Ascari was run through the
Directorate of Operations.
Q And that run, to the best of your knowledge,
did not hit Ghorbanifar?
A It did not. Our information processing
systems, as you know, are very imperfect.
Q The important thing is for me to know that you
went through the system. The checks were made, but you
didn't get a hit.
A I didn't personally make the call, but I had
an officer who said it had been traced through the
Directorate of Operations. "
Q During this period of time, the September
through November period of time, did you have occasion to
talk to the folks in^^H^f^^H office who do
intelligence analysis work on Iran?
A I believe I task£iP^is I^ftan analyst ,^HH
I can't recall all the tasking. She certainly
looked for^^H^^Hand sent the requirements out for
additional collectionson^^^^^B I also talked, I am
tc^^^^^^^^^^^^^^^^^^^^^B and
paper on arms sales to Iran. I'm fairly confident I
asked that. I did not go down and talk tc
about this initiative, because clearly I was not
authorized to either by Mr. Casey or by Colonel North,
mimB
447
MASSffi
212
1 since Colonel North, working with Mr. Casey, sort of set
2 the parameters on who could or who could not be aware of
3 this operation.
4 Q A couple of other minor cleanup matters that
5 have come up since you and I talked. Let me show you a
6 cable that does not have a date but which appears to me
7 from its content to have been generated probably in the
8 early fall of 1985. It's a SecretH||^H|^H cable to
9 ^^^H although it appears to relate to you as well, Mr.
10 Allen. It has our number N-9293 and that will be Exhibit
11 15.
12 (The document referred to was
13 marked Allen Exhibit Number 15
14 for identification.)
15 Again, it's a twofold purpose that I'm giving
16 the memo to you for — first, if you can tell me if
17 you've ever seen this particular memorandum; second,
18 after reviewing its content, if you have any knowledge of
19 the matters that are being described in the memorandum.
20 A What is the date of this?
21 Q That was one of the things I hoped you could
22 help me out with. My reconstruction of the facts set out
23 in the memo suggests to me it occurred probably in the
24 early fall of 1985, but I don't know. One of our hopes
25 is perhaps you can tell me when this was generated.
UNCtASStPIED
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UNCUSSffi
213
Thi3 would b(
As you
recall, he at time substituted when I was no longer able
to sustain myself.
Q Refresh my recollection, Mr. Allen. ^HHj
position was what?
A Was Deputy Chief of the — he's Deputy Chief
of the current^^^H and I can't recall what it is, but
it ' s ^^^^^^^^^^
Q I don't know how you guys keep track of the
vegetablf ~
A Well, it used to be called
I would assume that this must ^
relate to the mid-September 1985 activity
Q That was my guess.
A And I assume that, as Z recall, I worked for
about 48 hours straight and Z finally vent home and
Iwas working at my desk using my own]
system. He must have asked fori
priorities and these were the priorities that were
provided to^^^^^^^^^^H by Colonel North.
Q Let me just linger on this for 9iSfm«^ In
terms of the system that generates this kind of paper,
is the^^^^^^^Hsystem?
A That is one of the more remarkable systems
rnwrnn
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UNKmiFliD
started by Director Casey. It is a system that he, on
the spur of the moment, initiated to bring the
intelligence, counterterrorist — the intelligence
community counterterrorist elements together analytically
and in times of crisis. It's simply a secure electronic
comnunicationfl.-,»^tem inyoJt^JnK-all principal
intelligence agencj
And Colonel North used it frequently to
communicate with the intelligence community
counterterrorist analysts and with me, on occasion. v
Q Do you get an electronic display or does it
spit out a messaa£, or what haMen^ ^gTr: ^'^ir"
^. A^^^j^^get a display and then, of course, you can
havl" fT'printed. It's just a very simple electronic
system. It's a secure communications line, a PC and
printer — very simple. CIA pays for its operations and
maintenance. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^H
I manageiton behalf of the Director of Central
Intelligence. ,^^s^j^^^—'
Q With regard to a record, a memory of what
passes across the system, can you describe for me «$uit
system there is, if there is one, to record and maintain
messages that are placed on the system?
UNCHSSIFIED
82-688 0-88-16
450
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A I "^n explain to you in generic ■terms. There
is, in case the system crashes, there is a controller^H
^^Hthat retains the messages for a brief period of time.
In the January time frame I believe I alerted the
Inspector General, Mr. Hauver, of the potential that
there could be^Hj^^H^Hmessage relating to this
initiative.
Q jSpETanuary of '87?
A '87, between me and Colonel Norttl.
Ifs
my understanding that the memory or the memory capacity
is very brief and that they can only hold messages a "
month to six weeks. Therefore, any messages that could
have been transmitted during this initiative between,
say, September '85 and November '86 would not be
available.
Q To the best of your knowledge, there is no
master disk or other electronic record kept?
A There is no master disk or storage, to the
best of my knowledge. Mr. Carroll Hauver looked into
that only at my suggestion. I took the initiative in
that in order — because there may ^a%r« ^^len ^mmber ^
messages ^l|&o^^«« MtSKS^Ba^^S^'^H^SSuSB^&St
initiativ.
451
mmm
2X6
1 hard copy of messages on the^^^^^^^^H system?
2 A Absolutely not, because the idea is it's an
3 informal analyst-to-analyst communication system. It is
4 not a system for formal recordkeeping at all, and we did
5 not want it to be that way.
6 Q So there is no clerk assigned somewhere?
7 A Absolutely not. There are certain guidelines
8 under which it is used. I established those guidelines
9 and I can make those available to the Committee. I mean,
10 I established it in consultation with the other
11 intelligence agencies.
12 Q To the best of your knowledge is there a ■
13 writing, a memorandum, regulations, standard operating
14 procedure, that would set forth the record retention
policy for the^^^^^^^Hsystem?
16 A To the best o£ J^g^^ff^j^'J^.^"^" ' " "°
17 specific document as farBJ^^Hl^HjjH^nda^^Si which
18 would require retention. The idea is for ifefomal
19 analyst-to-analyst communications. For crisis management
20 we use it and we generate hundreds of messages a day over
21 it. I loolfe-«tgit wh«fcirc«*in in «!• motnlTg. "Z was
22 using it laa^night^o d^utr'* 'Specific issue, for
23 example, with a Defense Intelligence Officer on
24 counterterrorism, a specialist in ShSi ftJroamentsK sn .
25 It's a very, veri^food?aystem and we would not
UNfiUtSSIFIfD
452
uNCki^sira
217
1 want to make it a formal system because I think it would
2 thwart the objectives of the system and make it a formal
3 system that was not needed. Director Casey is very proud
4 of the system and I think it's just one more of the
5 contributions he has made tJg^he i»t«iligence community.
6 Q To the best of your knowledge it is not tied
7 into a larger computer system that would automatically
8 maintain an electronic record?
9 A To the best of my knowledge that is th« case
10 becmsa^ifr^ Hauver ^a^ssA^this ^^^im in^th* M^eh
11 tlBtt,^aB«^ Z b«^ev«^^S ^ had verified that the
12 records are kept only briefly. -^» ii^. r
13 V- - MS.. DQBtlAN: Chuck, may I add that I heard
14 about that system in connection with some investigations
15 in counterintelligence, and they said pretty much the
16 same thing. TtiljL'''^ '' ' ^ year and JaMlitW»99i fe:
17 '=^*^^^^!3Bii^^^i^^"^ ^^^ analysts are reluctant to
18 exchange information often because of security reasons,
19 so security was one of the big reasons they didn't want
20 to retain a record or have a printout capability.
21 THE WITNESS: I'm afraid I didn't understand
22 your statement for security reasons. We use it as
23 analyst-to-analyst communications. We do not put on the
24 system anything that's prohibited. We can go through
25 codeword information at any time. It is not a system for
M/tSSftED
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formal tasking. That's one thing w« want to avoid. But
for security reasons I really don't understand your
point. -^ ~
MS. OORNAN: That Wis What th« CI p«opl»^
emphaiizedr They AtbtTt: iouit to exchftnge information on-
- THE _«lTNEi^:^Wel^ ^^ ft»t%«^ gor^^. ^' -
sensitive operat ional._exch4»(!Ag^ , But it^ibSMd fpr
sutostantlve anAly^^ie lucchcnMit and ite )grt^aiarly^se it
^^H^^HH^^H^^^^^^^^^^^^^^^^^^Hduring
man»7«M^r He €l^use'^ wit^jKer<^M . .'^H* just did
^^^^^^^^^^^r;.ubl3\ E:~h«!^ed manage. -
■ -^MS. 0OSirXM:^^«B*t it aor* ^ less so^NSbat of
an eqi^^lent of a jMcurr^l^phgn* only you can get mor»
format i^^*^^g;r :.^ ^ _ ^ ^^-. .I^"^^" .Se»'^ -^
. jiL i^Tp^Bj^Ljiiii T infr iTiMi ijrhfT iM ^j^fnctrt liit
r J^iiliffifll^'i or you ^e^^p^eiiduto 'pdint> jmd on:^BBe
thing tbat you want^ s^y epecificallaF^Qg Colonel North,
on this inltia^s"^ *'^%,''**. ^^"^^ P*^'^* ^"* **
did not wi» it vry%ftMr for_tM« feitif^^ bec««« I
so^^l' coii&iiia. -Por^ v-i^
-- ^^BY mS^ tS^\ (J
Q ^^x« tidre ^nytittn? oi»^|his document thet would
W3imm
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UNCl^Sffi
219
enable one by looking at the lirtters and tiM numbers to"
tell what the date of the document ia? I confess X
puzzled with it last night and I was left bafflsd.
A I could ii^iuire^^^^^^Hand^ woald be pleased
to. Oh^ the content tells me that it's]
^- Q But there-' s noth^|g|^.^atf^unps out at you as
being a calendar code of - sons s^fC? -^ ii^'*?
A 5^^ Z "don't thiak tt^e^t^** nqv~becauM these
are considered very, very tempf^^ type exphaiifes. ^ey
_ ^^
are very current.
*- Q - sS^er^'s a ref«rence here, rfai* i|j|il^or^,
-saying we should nake^ every Effort to steer people away ^
^jl.cp«B^=any Jgf ogagtloyj^Pectad^ Z ':;;~^
wa{^i^kJ^Klpior«ithat^:^^ M
sensitive i^ti^tiv«^,-T'vh«t^ il^^^L#^iaeti^t,3^^ V^Ut^'
give or ffRre j^^riv^ to w;^ reg^j^^ not distriirattng
particularly HHH^HH^H||H^| th^^^aa being
collect^*auring th^period^f tlap^^pt d^teibuting^^o
the normal c^^v^'^*l^'|||m|H^^^^^^E. '- " '^^""^ -'
A . _ ^^B^t ^^en a^^structl^ ^l^^==fe»w
of, nor couICI sqa^(h it to^ st|grt5^tc»g I^gaa
always makes the defeifion oi^ wh««i«*^-tfl|^^MB eBipil •
not. Sometime^^^dwould ask me if they should put it in
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could it be related to this initiative, but I never told
them they couldft't disseminate anything, nor would that
be my position.
Q So I'm clear, in the period September through
early December 1985, you neither gave instructions nor
were you ^ are of a decision to not distribute!
to normal recipients of such intelligence?
A I have no knowledge that an^
■was not disseminated because of this
initiative. I never gave any instructions not to
disseminate. I only gave guidance if it appeared tha^
there was something very senvltivm: relating to this
initiative or to sensitive hostage matters perhaps it
should be disseminated in the hard copy format rather
than the electronic distributiSlLi. l^^featBC.Wi fcvery
infrequent occasion.
Q Even in that J^mpiH ,:,:^ JgH^ September through
early December period, do you have a specific
recollection of that kind of guidance being given by you?
A Never. I'd like to point out, as you recall,
when I tried to-dia
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Q There is another memo, and 1 lose tracJc of
which system these things come off of, but this is an
Ollie North memorandum of November 9, 1985, which appears
to me to be making reference to a close-down of normal
distribution and, in this particular memo, opening it
back up again. Again, if you'd look at it — it's very
brief — maybe you can tell me what was going on at this
period, which is November 9T~^985,_jind t^t will be\
Exhibit 16.
(Th« <docOD«nt referred to was
marked Jai«n E^ibit J^^«r 16
Q November 9, 1985.
A I don't know what they mean by "we hav« told
^^Hto down on^^^^^^^^^^^^^^Hand normal
closed clistriMIH^i^^^^^^^fl^^^^^^HH" I'm
certain down on^^^^^^^^^^^^^^f ,
have no knovladg* of what he means th«r«.
- Tha^BSfty thing that I know that ha must ba
talking about!
I did arrange, as you
know and as I've testified, at Mr. McFarlana's guidance,
through Colonel North, for hov
would be disseminated^^^^^^^^^^^fend that that
UimSSIHED
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dlssaminatlon excluded the Secretary of State.
Q You've been very clear on that in terms of^H
but again to the best of your
recollection there was no shunting process in place to
keep the normal f low^^^^^^^^^^^^^^H on Iran
the hands of its nonnal consumers?
A I am convinced there was nothing of that, and
certainly nothing came from me. The integrity of the
intelligence process is
Absolutely there would be
no constraints on dissemination^^^^^^^^^^B only how
^^^Lwas handled in order to restrict
its dissemination.
And, at McFarlane's guidance, through North, I
arranged foi^^^^^^^ldisseminatior
Q With regard to this particular memo, you don't
recall having seen it contemporaneously; is that correct?
A I did not see that memo.
Q Have you had occasion to discuss this memo
with anyone else before?
A I have never seen, never did know it existed,
never discussed it with anyone.
Q And yotf told us ^ha€^i« references to
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November-December period of 1985 do you have any specific
recollection of meetings, conferences that you would have
had with
A Would you repeat the date of that?
Q September 1985 through early December 1985, do
you recall meetings that you would hav« had with|
|or conversations?
A I don't recall a specific meeting, but I know
Z talked to him on the secure telephone about the
initiative and I must have met with him once or twice'
during that time frame on the initiative, but Z can't
recall specific dates, it would be on my calendar. I'm
sure be in^^^^^^^^^^H calendar.
Q The decision on distribution would have been a
decision tha^^^^fand his people would have made?
A Distribution ol
Q Yes.
A On I
Q Yes, sir.
A Well, I have testified to the Senate Select
Cbmnittee on Intelligence and to the Tower Commission
when ^^^^^^^^^^^^^^^^^^^^^^^^M asked
for a dissemination
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waited for an hour while Colonel North obtained guidance
from Mr. McFarlane. Mr. McFarlane made the decision that
the dissemination should be to him and Colonel North, to
Mr. Casey and Mr. McMahon, and to Secretary Weinberger.
Q And as to Secretary Weinberger, that was by
way of Admiral Moreau; is that correct?
A Well, that's the way it actually worked, and
Admiral Moreau talked to me^^^^H^HH|^|^|several
times, and as long as Admiral Moreau was Assistant to the
Chairman of the JCS,1^HHHHIhad no problems with
_control over the disseminatior
Q I'm sorry. I did recall your testimony on
that initial contact. Subsequent decisions on
distribution, if they had to be made, would they have
been mad^mi^^or would they have been made by someone
else through you?
A ^^^^^would have asked for guidance. I know
^ha^^^^^^^^H as verified, believe with
Admiral Poindexter, that the dissemination was correct.
I believe Admiral Poindexter affirmed that this was the
way Mr. McFarlane wanted the dissemination.
Q How do you know that?
I believe
told me that.
ONeefOTD
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imcusiiED
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1 THE WITNESS: Could I take a coupl.-minut.
2 braak?
3 (A brief recess was taken.)
* BY MR. KERR: (Resuming)
5 Q Mr. Allen, let's go to the December 4 meeting.
6 Let me ask a few questions about the context. When you
7 testified the other day, you indicated you met with
8 Ledeen at his request in November, and we looked at some
9 materials that had been provided to you by Ledeen in
10 November.
^^ A Along with Mr. Clarridge; he was present
12 throughout the session. ^
^3 Q Then there is a subsequent meeting on December
^* *• ^°^ di<i the second meeting come about? How were you
15 all apprgached?
^* A I bfiii^ l^^Ledeen called Mr. Clarridge.
17 Mr. Clarridge set up the meeting. I met initially in Mr.
18 Clarridge'* cgj^e.^ Mr. Clarridge asked what could we do
19 for you, Mr. Ledeen, and Mr. Ledeen started talking about
20 Iran, the problems of a lack of a political relationship.
21 He confided that he had been a consultant to the NSC and
22 to Mr. McFarlane, that he had, at McFarlane's direction,
23 undertaken some initiatives, that he had b#m involved
24 withthis^ activity relating to information that we had
^^^"^^^^^^^^^^■■^^^^■■that Colonel North
TliHBI
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ICLASSIFO
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had mad* available to him at the NSC,^^^^^^^^^^H
and that he brought
hin^^^^^^^^^^^^^^^^^Hon Manucher
Ghorbanifar, along with^^^^^^^^^^^^l I believe of a
man called^^^^^^^^^^^B whom he identified asj
He said he had a good deal of inforaation that
he had obtained not only from Mr. Ghorbanifar and others
but that he with^H^H^^^^^^^^and
had insights into Iranian terrorism, factions within the
government. He also started talking about the NSC
initiative. Mr. Clarridge, who I believe was getting
ready to go to Europe, said well, why don't you meet now
with Charlie and give him all the data and let Charlie
write it up, and we retired to my office, which was just
a couple of floors directly above Mr. Clarridge '■ office,
and he gave me some information which I then recorded in
a memorandum, I think dated 18 December 1985.
In that he started talking about the various
factions within the Iranian government, and I said this
is very confusing. I can't write this up. If you have
what you think is unique information, you must go home
and develop a coherent statement. I believe he did that
and I believe he did it in a matter of a couple of days.
imssniD
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229
1 And he sent that back to the Agency and I don't recall
2 how it came back, but I think it was included as an
3 attachment to my memorandum oC 18 December.
4 He talked also about the initiative and the
5 fact that he had become convinced, and so had Mr.
6 HcFarlane, of the need to probe elements within the
7 Iranian government, that he had met Mr. Nimrodi — and I,
8 of course, by that time had heard of Mr. Nimrodi — ^H^|
^^^^^|^^^^B^^^^^|R|H||^|^^^^H He
10 about Ghorbanifar. That was the first time I knew that
11 there was a man named Manucher Ghorbanifar.
12 He talked about, I believe, David Kimche and
13 some of David Kimche 's activities. He was quite guarded
14 in his conversation. He did not want to tell me too
15 much, and he claimed, as I recall, that he had not put
16 much of this down on paper but he had restricted his
17 reporting to Mr. McFarlane to sort of oral conversations.
18 But he thought that there was promise to proceed with an
19 initiative towards Iran. He said that Ghorbanifar was a
20 good fellow, praised Ghorbanifar to the hilt.
21 I put all this into a memorandua. He also
22 talked about the shipment of weapons that had occurred in
23 November. In reviewing my memoranduB it is clear that he
24 mentioned HAWK missiles were sent. I had testified
25 earlier, I believe, to the Senate and to the Tower
UNemiflED
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Conunission that I did not learn that it was HAWK missiles
until I met Mr. Ghorbanifar on the 13th of January 1986.
It now appears that I did know about it on 4 December
1985. But when we were trying to reconstruct the
chronology in November, trying to get Mr. Casey ready for
testimony on the 21st of November, I did not recall Mr.
Ledeen mentioning HAWK missiles.
I've always testified, however, that by the
26th of November I was fairly well convinced^^^^^|^^H
m^^^^^^^that Colonel North's story that this was
oil-drilling equipment was falsa, that for reasons that I
could not understand, I guess — but I can understand,"
given Operation STAUNCH — that Colonel North did not
want to tell me that it was weapons being sent into Iran.
I believe that, very briefly, summarizes that
conversation. I did take the paper that Mr. Ledeen
prepared on the various factions and who belonged to what
factions and Ict^m^m^m review it. She thought
it was a good paper in some respects. I think she said
it added to her knowledge, but it was generally in
alignment with her views of how the factions were
developing in Iran and each faction had elements within
them and some members of one faction would converge with
members of other factions.
So it's not an easy situation to assess.
[
466
UWSSED
231
1 Q Let me just pursue a few other points. In
2 terms of Mr. Clarridge and his trip to Europe, do you
3 recall where Mr. Clarridge was going on his trip in
4 December of 1985?
5 A Europe.
6 Q Do you recall what part of Europe he was going
7 to?
8 A I don't think he told me. He was off on an
9 operational activity. I'm sure he would have told ma if
10 I had asked, but I had no need to know, so I did not ask.
11 Q Do you today know where it was that Mr.
12 Clarridge actually went?
13 A No, sir.
14 Q The Director also was out of pocket during the
15 early part of December 1985. Do you have any idea where
16 he might have been in that period through 7 December
17 1985?
18 A No, sir. I don't recall. He traveled
19 frequently.
20 Q I understand. Do you know if he and Mr.
21 Clarridge met in Europe in the period of the 5th through
22 the 7th of December?
23 A I don't know, sir.
24 Q Do you have any knowledge of a meeting with
25 Mr. Ghorbanifar, a person contact with Mr. Ghorbanifar,
IINK»IEfl
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IINCtASSW
232
in the first week of December?
The first week of December?
Yes.
A
Q
A I believe Mr. McFarlane went to London to meet
with Ghorbanifar.
Q That would have been the 7th or 8th?
A The 7th or 8th. And they met. Colonel North
was there and Colonel North gave me a brief readout when
he returned.
Q Do you have any knowledge of Clarridge or
Casey having been involved with those meetings in, I
believe it was, London?
A No, I have no knowledge of that.
Q Mr. Clarridge's deputy at that time was a ^|B
|whose name I am probably mispronouncing.
A
Q Do you have any recollection of either
briefingJI^^^^^^^^Hon what was about on this
initiative or the November arms transaction or in any way
bringing him up to speed in Mr. Clarridge's absence?
A During the first week of December?
Q Ves.
A I don't recall that. I know]
but I don't recall that. I just don't recall.
Lejt_me have you, if you don't mind, identify
468
(iNcussn
233
1 the December 18, '85 memorandum of your December 4
2 meeting, which I'd like to have marked as Exhibit 17.
3 (The document referred to was
4 marked Allen Exhibit Number 17
5 for identification.)
6 A I recall writing this memorandum and some of
7 the content.
8 Q In terms of just timing, there was a passage
9 of time, apparently, to the 18th of December until this
10 memorandum was prepared. Were you out of the country
11 during that period of time?
12 A No, sir, I don't believe I was. But I was*
13 busy on numerous things — estimates, interagency
14 meetings, conducting and coordinating intelligence
15 community priorities on terrorism. I sort of worked on
16 this as I could find time to put it down clearly, and I
17 know I sent a copy of this to Mr. Clarridge and I don't
18 know where else I sent it.
19 Q That was my next question, and that was the
20 distribution of it.
21 A A copy went to Mr. Clarridge. I hop* I sent a
22 copy to the Director. I don't recall. My secretary
23 might have something on this.
24 Q Do you recall whether or not it went to Mr.
25 Fuller?
UNClASSIFIfD
469
mMMH
234
1 A No, I did not send it to Mr. Fuller because I
2 was not authorized to send it to Mr. Fuller.
3 Q Explain that.
4 A You must remember that this was the most
5 compartmented effort under way of the U.S. Government at
6 that time. The NSC was setting the guidelines on access,
7 and so Mr. Casey within the Agency would not want me to
8 disseminate something this widely.
9 Q That's what I'm trying to pursue, and let me
10 come at it another way. Ledeen had contacted you and'
11 Clarridge in November. He then comes back and meets with
12 you on December 4. Was it your impression that Ledeen
13 was coming to you and Mr. Clarridge under the authority
14 of or with the knowledge of Colonel North?
15 A I believe he indicated that Colonel North knew
16 he was coming out to talk to us, yes.
17 Q Was it your understanding that he was giving
18 you a briefing on what he'd been doing at the behest of
19 Colonel North?
2 0 A It was not that impression. It was my
21 understanding that Colonel North was the focal point for
22 Mr. McFarlane, but what he was doing as far as the
23 initiative was at the direction of Mr. McFarlane. At no
24 time did he indicate he was taking guidance or direction
2 5 from Colonel North.
IWetitSStffiD
470
235
1 Q I'm still having trouble, Mr. Allen, so bear
2 with me. He comes to see you and Mr. Clarridge on the
3 4th of December and he gives you a fairly elaborate
4 discussion of the history of some of the things that you
5 actually were now working on in terms of intelligence
6 gathering.
7 A And my first top-down view of what might be
8 occurring, although I had made a lot of suppositions.
9 Q Did he present himself as being someone who
10 was giving you a briefing because Colonel North or Bud
11 McFarlane, for that matter, had asked that you all be
12 briefed?
13 A I think he said that Colonel North had agreed
14 that he should give this kind of top-down briefing, but
15 he made it crystal clear that his work was for Bud
16 McFarlane, not for Colonel North.
17 Q You will recall, perhaps, the last time that
18 we talked in the interview that there is a memorandum,
19 November 26 memorandum, McFarlane to Poindexter which
20 basically says that Mr. Ledeen should be taken out of the
21 loop, out of the ongoing negotiations with Ghorbanifar.
22 Were you aware that McFarlane had expressed such a thing
23 at the time you met with him?
24 A Not at all.
25 Q That was Ledeen, I'm sorry. You were not
471
236
1 aware of that?
2 A No. I had absolutely no knowledge. I did
3 have knowledge that a transition was under way. Mr.
4 Ledeen did indicate to me -- and I don't believe it's
5 recorded here — that he expected that Mr. Poindexter, as
6 the new National Security Advisor, would not want him to
7 work directly on hostage-related activities in regards to
8 the Iran initiative. He still would remain as a
9 consultant to the NSC on counterterrorism, but that it
10 was clear that there would be a distance between him and
11 John Poindexter.
12 He still seemed to have the view that John •
13 Poindexter did not object to his pursuing the broader
14 geostrategic objective of looking at ways to find steps
15 that could eventually lead, over time, to rapprochement
16 with Tehran.
17 Q So it was your impression from what you recall
18 Ledeen telling you on December 4 that Ledeen still had
19 the assignment or at least the leave of the National
20 Security Advisor to be involved in an attempt to open a
21 door to Iran; is that right?
22 A That's my understanding, but not specifically
23 involved in this operation relating to the hostage issues
24 and the specific operational activities relating to
25 dealings with Ghorbanifar and^^^^^^| It seemed to me
472
\mmm
23'
1 that Colonel North had the prime job of doing that.
2 Q But as to what Ledeen's role, function, where
3 he was in the compartment, did you have an impression of
4 that? Did you understand what Ledeen's function was
5 going to be?
6 A Ledeen stated that, you know, in the future he
7 would not want to talk about the specifics of any
8 activity relating to trying to find ways to obtain
9 release of the hostages, that that was not to be his
10 role, that he would have a broader role of advising the
11 National Security Advisor and others on opportunities for
12 finding political rapprochement with the government of*
13 Iran.
14 Q There is a reference in the memorandum to
15 Ledeen telling you about McFarlane's becoming involved in
16 this matter oveiSlpyear before. Did he talk to you at
17 all about what McFarlane was doing in late 1984 vis-a-vis
18 an Iran initiative? --.■^-^ aier
19 A No, he did not.
20 Q So he didn't go into any more detail on that
21 score?
22 A No. He was quite guarded in his conversation.
23 Q There is a reference in the memorandum to
24 Ghorbanifar's prior relationshipiS' with the Central
25 Intelligence Agency and that they had been, from his
UNGUtSSm
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UWMSSIFIED
238
1 perspective, from Ghorbanif ar ' s perspective, bad. Did
2 you explore that any further?
3 A No, I didn't.
4 Q As a result of this meeting did you make
5 efforts to determine the nature of Ghorbanifar 's prior
6 history with the Agency?
7 AX don't think I did. I know that information
8 was provided to, as I recall, to Mr. McMahon, who I
9 believe had a search made of the records, and then when
10 he attended the meeting in the Oval Office on the 7th I
11 don't know when this memorandum came forward, but I know
12 that Mr. McMahon told me that he had apprised, I believe,
13 the officials that met that morning of the lack of
14 reliability of Ghorbanifar.
15 Q At paragraph 8 of your memorandum you say that
16 Ledeen noted that he, presumably Ledeen, would be
17 traveling again short^tjeto Europe and would be discussing
18 the proposed Libyan operation further with Ghorbanifar.
19 He was hopeful that in the meantime some reaction could
20 be obtained from CIA. Ledeen noted that he had discussed
21 this issue with Oliver North of the NSC, who favors the
22 undertaking of this operation.
23 In reading that I assume that you were saying
24 that Ledeen told you that he had discussed the Libyan
25 scam, if you will, with Colonel North; is that right?
tINtttSStFIEB
474
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239
1 A That's what he told me, yes. I discussed that
2 with the Director, who was not enthused.
3 Q Did you discuss it with Colonel North?
4 A I believe I did, and he endorsed if. But
5 Director Casey never endorsed it. And also I think Mr.
6 Clarridge had serious doubts and certainly this came up
7 three or four times. Mr. Ledeen, I believe, surfaced it
8 with Mr. George, and he surfaced it with the Director. I
9 don't know whether he ever discussed it with Mr. Gates.
10 And he was quite persistent in this over a period of
11 months, and at no time was he ever given any
12 encouragement by anyone, certainly not by me, that this
13 would be a f ruitful ■ effort .
14 Q That suggests to me that Ledeen was working
15 for somebody, but I'm not sure who he was working for.
16 Was it your impression that he was carrying out — in
17 terms of he says he was going to go talk to Ghorbanifar,
18 I take .it^in December, who was Ledeen working for?^ Was
19 he working 'Ifbr McFarlane?
20 A I thinic he viewed that as part of his
21 activities as advisor and consultant on counterterrorism,
22 that here we had a terrorist state, which is Libya, and
23 on which we have absolutely incontrovertible evidence of
24 continuing terrorist activity against a number of
25 targets, including the West and the United States. And I
UNtblSStFe
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uNCLASsmm
240
1 think he felt very strongly that if there was some action
2 that could assist in bringing about a change in the
3 government in Tripoli that would be a good thing, that
4 that would decrease terrorism. Fifty percent of all
5 international terrorism stems from the Middle East.
6 Q Accepting all that, I am puzzled who you
7 thought Ledeen was working for at this point.
8 A I don't know. You are asking me to speculate.
9 I'm only saying he was a consultant on counterterrorism
10 and I assumed he felt that was a plausible thing to
11 suggest. I just can't speculate on that.
12 Q I'm really not asking you to speculate. What
13 I'm trying to find out is what perception you had of
14 whose mandate Ledeen was working under. Was he working
15 as an independent contractor?
16 A No, sir. He was working, when he met with me
17 and Mr. Clarridge, each time he represented himself as a
18 consultant to the National Security Advisor on
19 counterterrorism.
20 Q The National Security Advisor, i.e., Mr.
21 McFarlane and then subsequently Mr. Poindexter or Admiral
22 Poindexter?
23 A That is correct.
24 Q It was your impression that this memorandum
25 was to be distributed to Clair George; is that correct?
msimm
476
uNcussm
241
1 A I don't recall to whom I disseminated. I know
2 I sent it to the Director, to Mr. Clarridge, who was a
3 division chief in the Directorate of Operatfens, and
4 where he further diss^aiinated it within the DO, I don't
5 know. I would have to check on the dissemination. There
6 must be a dissemination page somewhere. I don't see it
7 with that copy. ^ffS
8 Q And you don't have a current recollection of
9 what the distribution was. ,^-
10 A No, I don't.
11 Q In terms of the date that you did this,
12 December 18, 1985, just tarrying on that for a moment,'-
13 the Tower Commission^ndicates that Director Casey met
14 with Mr. Ledeen on the 19th of December. Do you have a
15 recollection of preparing Director Casey to meet with
16 Michael Ledeen?
17 A I believe I talked withMr. ^feey at some
18 point prior to Mr. Ledeen meeting with Mr. Casey. I told
19 him that one of the ideas that would be suggested would
20 be the Libyan sting op^ation, if that's what you want to
21 call it. I don't think Mr. Casey was enthused about it.
22 And also I think each time I met with Mr. Casey, as NIOs
23 do, we talk about a wide variety of subjects. We
24 normally talked at some point during the conversation
25 about this initiative, and I'm certain I told him what I
UNCIASSffl
477
ONCUSSffl
242
1 knew about Ghorbanifar.
2 Q You did not sit in on Casey's meeting with
3 Ledeen on the 19th?
4 A No, sir, I certainly did not.
5 Q Did you have a discussion with Director Casey
6 about his meeting with Ledeen immediately after his
7 meeting with Ledeen?
8 A I don't recall. I believe Mr. Casey said that
9 he had discussed it. He had had a discussion with Mr.
10 Ledeen, that he enjoyed talking with Mr. Ledeen, who has
11 a very sharp mind, but I don't recall the substance of
12 that conversation. At no time do I believe that Mr.
13 Casey or anyone else encouraged Mr. Ledeen that the
14 Libyan sting operation was one we were willing to
15 contemplate. Activities relating to the Libyan operation
16 was run by^^^^^^Hat the time, and they had a lot of
17 other ideas other than this one.
And in talking with^^^^^^^^^and others
19 about this, and Mr. Clarridge, no one in the DO would
20 engage in this operation, a sting operation of this
21 nature, as long as Mr. Ghorbanifar was an elemeht in that
22 operation.
23 Q Let me pursue that. Your meetings in December
1985 with^^^^^^^H or^^^^HH| do
25 specific recollection of you talking with them about
[:c|Ct7t9|^wl
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1 these matters?
2 A I recall having lunch wlt'i^^^^^^^^H, and it
3 might have been in early January '86, where we talked
4 about Mr. Ghorbanifar over lunch, and!
5 reiterated a view that he has held consistently that
6 involving Ghorbanifar in clandestine operations is not a
7 feasible approach, that Mr. Ghorbanifar is
8 uncontrollable, duplicitous. He made it clear that he
9 was concerned at that time by the NSC's use of
10 Ghorbanifar in this very sensitive Iranian issue.
11 Q Do you recall that you had discussions of this
12 kind with ^^^^^^Bduring this period?
13 A I don't ycil^fcl tbat^ixo. ~^BUt Z'b certain^^^
14 ^^^^shared the same views, because Z think you know
15 sometime during the last year we have discussed Mr.
16 Ghorbanifar with^^^^^^ It's quite consistent with
17 his views on Ghorbanifar.
18 Q Do you recall having a lunch or a meeting, a
19 face-to-face meeting of some kind with^^^^^^^^relating
20 to his views of either Ledeen or Ghorbanifar in the
21 December 1985 period?
22 A I d8Stl^P**ft^^&**^afc5^ •• ^s^^^lffe^iM -.^..^-^Ste
23 - ~Q ^^^^SMr4^sr^^^^M^ni^Pi«t^^' McMahon had with
24 various people about the Iran initiative on December 5.
25 ^^^^^^^^B^^notes on that meeting do «ot indicate Aat
icttsstfe
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UNGUSSm
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you were present. Do you have a present recollection of
attending a meeting with McMahon at ^at tim^
A No, I was not at that meeting.
Q You did prepare a memorandum, I believe, on
December 6 on the Iran political scene. Do you recall
preparing such a memorandum?
A I recali^^t Mr. Crtifftp dix«cElon that "1.;
prepare some^ing and c^^dinat* it with,^ b«\|,«|r«,^^H
er^6^19»S
vhlch will )}e
_ Qs - Let 'W,Bjf.j|^gt- tshew -jpbu «^
memorandttB on t^ Iranian pd^^ical
Exhibit 18, I wi5«v*T .1- -^-,^ -j-^-m^ ^ - ~^-'i
__^ ^~-- (fStgdocaaig^ r«fczrr*d to was
-^- n8^)c«^-All«n^xM^i« ^iavc is^
'^^^^'^'' -y-~ fnrr taJntffl-ntlwiiMjd i, ---^
La
wit%:th^l§tnian"4«^an|_withl^^a^I*^«^ He
tho\^|hfe^^ Vx. -^i^mct^ui. aoa» as«^l inUgSiraa a
result of^mh^iia1bfcriji*=Jfegu«t», which Mr . I*4a«n had
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made available to m». ^ -.t
Q In December of 1985 the National Intelligence
Officer on the Near East was Graham Fuller, is that
correct?
A That's correct.
Q Why were you being asked to deal with matters
that were within Mr. Fuller's area of responsibility?
A That's a good question. I probably shouldn't
have written it. It was one that Mr. Casey said just you
take your own look at this and see what you can come up
with, and I did that at his request.
Q Do you have as of today any knowledg* as^taT
why Fuller was not included l^^hfs aa:ttarr~ln early
December? .^^^,^"" .=.? :.3S^"«^^v '". _^j. ^. '• _-- _. '^
It's j uj^._^!^Sha»- ^^Sn '^^jsl^B i ijijljij^^'^ww ligT" I 94ytt.. .
purposes, andFl deh'% knoiF ^at^-jpurposc" h^^ua«4--it for.
Q Do ^u have a r*coir«ction of^atng told not
to.jdlscuss thes*- Battttz:)|^lth ll^lail*r?
A
— A tr^annot. :^ I ia?t ^ataT t^E»ow-: _
knov,^ke a look at'what''Mr. Ledeen is providing, see if
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it coincides with what w« think, and I^acall showing
this to someone ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^1
probably^^^^l^^^^^H^ She thought was good. She
made some adjustments to it. I think it drew heavily on
some of their analysis as well.
Q In terms o£^^^^^H^^Hboss, who
reporting to at that point?
A Well, she was reporting to — well,
waa the director of the office.
Q Hasf^l^Hher immediate superior?
A No. I don't know who her immediate superior
was, probably^^^^^^^^HH who was the Iranian analyst.
Q Do you know the extent to whict^^^^^^^^Hwas
aware of your involvement in these matters in December of
1985?
A I don't know whethert^H||^H||^talked to him
or not.
Q In terms of working with^H^^H^ had you
discussed withV^^H^^Hwhether or not ha was agreeable
to you working with^^^Hon these matters?
A I told her that she could discuss it with him,
and I told her it was extremely sensitive, and this was
sort of an offline type of activity, very unusual, and I
don't know whether she did or not.
Q You do not remember clearing with]
IWKftSStnED
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482
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1 your discussions of these matters with|
2 A No, I don't recall that.
3 Q Do you recall knowing that Mr. McMahon was
4 preparing for a December 7 conference at the White House
5 with the President at the time that you wrote this
6 December 6 memorandum?
7 A No.
8 Q Was this December 6 memorandum prepared by you
9 to prepare McMahon for such a meeting?
10 A I don't know. I just gave it to the Director.
11 As far as I can recall, it was jsomething the Director.
12 asked for.
13 Q I understand that. But you're telling me,
14 though, it was not being done by you as a way of
15 preparing McMahon.
16 A Not at all. Now whether Mr. McMahon used it
17 or not I have no Jcnowledge.
18 Q You would not have basn nesting with McMahon
19 at this point in time, then, to prepare him for a meeting
20 with the President?
21 A No.
22 Q I was left with the impression from our prior
23 interview that you debriefed McMahon immediately after
24 his meeting at the White House with the President. Is
25 that impression incorrect?
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A That is incorrect. He told me about the
meeting on the 7th of December on the 16th of December,
when we I believe were en route to attend a meeting of
the Vice President's Task Force for Combatting Terrorism.
We discussed it in the car all the way down and we spent
most of the time discussing the initiative all the way
back.
Q But insofar as McMahon had responsibilities on
the 7th of December, he would not have discussed the
responsibilities with you contemporaneously?
A No, sir, he did not, I can assure you. He .was
aware and was seeing the intelligence that was being
collected^^^^^^^^^H^^^^^^^^^^^^^H He was
aware that I was coordinating the tasking on it.
Q Again I'm having trouble figuring out roles
here. Bud McFarlane was dispatched to meet with
Ghorbanifar and he did that in conjunction with Colonel
North in the period December 7-8. Your involvement in
that trip was what?
A One of tasking.
Q And when you say that what are you telling me?
^^^^^^^^^^^^^^^^^^^^^^^^^^H I knew
Colonel North was going there; he told me he was. So it
was strict^ fi^oa^y
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Q Colonel North asked you tol
^^m^^^^^^^^^^^^Hon trip to
London at this time?
A Ko. On the fact that he would b« meeting with
Manucher Ghorbanifai
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BY MR. KERR: (Resuming)
Q Mr. Allen, so that you understand what we are
interested in —
A I guess that's what I need to know.
Q Let me try to focus you on what our interest
is because it really does not go to that area.
A Okay.
Q Our interest, or at least my interest, is in
direction, instruction, requests that you were getting
from Colonel North.
486
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251
1 1985 that he wanted!
2 is that what you're telling me?
3 A Yes, sir.
4 Q That suggest to me that clearly you knew North
5 was going to be in London to meet with Ghorbanifar in the
6 period December 7-8; is that correct?
7 A Yes. He indicated he would b« meeting with
8 the Iranian intermediary, yes.
9 Q And likewise you knew that Mr. McFarlan* would
10 be in London for this effort?
11 A I'm not sure when I learned of that. I may
12 have learned that McFarlane was there when Colonel North
13 returned and said Mr. McFarlane was there. I don't think
14 he told me in advance that Mr. McFarlane was going to
15 London.
16 Q Again that's what I'm trying to get a sense
17 of. Did you know prior to them going to London that they
18 were in fact going to make that trip to London?
19 A I knew Colonel North was. I cannot recall
20 being told in advance that Mr. McFarlane was going.
21 Q And when you say you knew that from Colonel
22 North, did you know from Colonel North the purpose of the
23 meeting in London?
24 A As I understand it — and this was after he
25 returned -- the objective of the meeting was, following
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487
252
1 this rather serious debacle that had occurred in lata
2 November, was to have one final exchange with the
3 Iranians to determine the feasibility of whether there
4 could be continuing contact, whether there could be an
5 opening determined with the Tehran government, and
6 whether the hostage problem could be resolved as an
7 impediment to the opening of those relations. That was
8 my understanding of the meeting.
9 Q And you have had that understanding —
10 A After the meeting occurred.
11 Q After the meeting occurred?
12 A Ves.
13 Q And you had gotten that understanding because
14 of conversations that you would have had with Colonel
15 North after the meeting?
16 A That is absolutely correct.
17 Q Okay. Thank you.
18 Nov from the Tower Commission report we know
19 of a memorandum that Colonel North wrote on this meeting
20 in which he talks about a number of things, but one of
21 the things he talks about is utilizing General Secord as
22 a conduit in this initiative. At this period of time,
23 December 7 and 8, 9, 1985, were you knowledgeable of
24 General Secord being involved in this matter?
25 A As a conduit to the Iranian government?
UNCDiSSIFIED
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1 Q Um-hum .
2 A I was not aware that ha was going to b« used
3 in a sense as a conduit or a negotiator. I was aware
4 that an individual named Copp in the November time frame,
5 the week of November 21, was in^^^^^Hand that he was
6 somehow involved in assisting in the shipment that
7 occurred the weekend of 24-25, and I later was able to
8 decipher from Colonel North's comments that the man named
9 Copp was really a man named Major General Secord, whom I
10 had not heard of previously, to the best of my
11 recollection.
12 Q What I'm driving at is that as of December 7,
13 8, 9 —
14 AX was not aware that he was involved as a
15 conduit or a negotiator or that a proposal had been made
16 that he would be a negotiator. As far as I can recall,
17 to the best of my recollection, I don't think Colonel
18 North said anything about General Secord at that time.
19 Q So you were not witting, so to speak, of
20 General Secord 's function in these matters in early
21 December? ~^^^.-^ ":^ "- --^ -^
22 A .. "^hat is correct, not in the sense of being a
23 negotiator between the United States and Iran. I knew
24 that there was an individual named Copp who was in some
25 way involved in logistics, movement of equipment to Iran.
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Q I think I understand what you're telling me,
but let me just pursue it one step further. Copp was the
name that you knew. Copp's identity as Secord you did
not know.
A I'm not sure when I learned that Secord was
the equivalent of Copp.
Q My impression is, from what you have been
telling m», "that Colonel North during this period of time
would go to various people in the government and ask them
to do certain specific narrowly-defined things for him to
assist him, and in that sense he made use of you; is that
correct? '
A That's my impression, that, as with many
sensitive operations, you frequently compartment it. You
utilize various people for various purposes. He utilized
me for the collection tasking coordination, which was not
an lflH^iipii|.~triii1rT1Tni^'"' "11 iilM'ltfJ 1 in the
intensity, duration and specificity of the task.
Normally NIOfc-taak on a more gen«ric*lMsif, But blouse j
te^ tuid j|^tm~m«~ for"
reason he had to
turn to someone that he could trust.
I had a thousand other duties. It was an
extra burden for me and took away a lot of nights and
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T"^V
1 weekends from my TamiiirVAtti4(t.,.Jl<'4J,d^* because Colonel
2 North said it was important and the Director and Deputy
3 Director endorsed my activity.
4 Q What we're trying to do to some extent,
5 though, is come to an understanding of —
6 A How he compartmented?
7 Q Exactly.
8 A He did a very good job of it, I think.
9 Q So he would not have shared with you how what
10 you were doing fit into a grander scheme, if you will?
11 A That is correct — not in all its
12 ramifications. It was clear from the meeting that
13 occurred. He told me after he returned from London that
14 McFarlane was there and that he and Ghorbanifar had not
15 had a meeting of the minds, and it was not a good scene.
16 Colonel North was unhappy that McFarlane was not more
17 positive toward continuing the initiative. I do recall
18 that.
19 Q And it's in that context —
20 A Let me just continue. Later on, after the
21 Presidential Finding and after I certainly became aware
22 and after Mr. Cave and I worked •y«ry day togatbar — I
23 haul-many ^har dijfc).ri|jmTr'TTr^JYi.£nnrtnrr'Tn vrark out of
24 my office — I was cognizant of broader aspects of the
25 operation. But up until the Presidential Finding Colonel
UNCEHSSfFrH)
491
IINGIASSIFKD
256
1 North kept things highly compartmented and I think that's
2 the way in some operations you have to actually function
3 if you want to keep absolute security.
4 It didn't bother me so much so long as the
5 Director approved it.
6 Q Fine. What I'm trying to determine is the
7 extent to which you would have been apprised by Colonel
8 North of the broader implications of what he was doing at
9 this time, and what you're telling me is that you would
10 not have been brought into this program at that level of
11 generality; is that correct?
12 A Only in a general sense. I knew clearly what
13 was being involved, that we were trying to open a
14 relationship. I felt that Mr. McFarlane was trying to
15 open a relationship to Iran, that he had given the
16 activity principally to Colonel North to bring focus to
17 the activity, and that Colonel North was very sensitive
18 to the hostage issue and that tactically he felt before
19 geostrategic relations could be accomplished that there
20 had to be this preliminary obstacle, that the American
21 hostages in Lebanon had to resolved.
22 And it became a question, and that's one thing
23 where I did get involved and where I did have sxibstantive
24 responsibility, was trying to evaluate the degree to
25 which elements within Iran had control over the captors.
MLt^^^tFrrn
492
BrftslSSiflED
257
1 I've spent a lot of time' •Dver^^1ie"'ta»t year writing about
2 that, convening analysts to talk about that, and we still
3 have a dispute within the intelligence community over the
4 degree to which Tehran can control the elements holding
5 the American hostages.
6 Q Okay. Again, bear with me on where I'm trying
7 to come from here. One of the things that North is
8 mentioning in a memorandum that he writes on December 9
9 is a whole host of things about the arrangement. He's
10 trying to spell out to Poindexter in a memorandum at that
11 time a variety of things that are going on. One of the
12 things he mentions in that memorandum to Poindexter is'
13 what he describes in the memorandum as a kickback
14 arrangement.
15 I take it from what you're telling me you were
16 not aware of a kickback arrangement at that time?
17 A I knew nothing of the financing.
18 Q So your function in this arrangement, as you
19 are describing it, was narrow, limited, compartmented,
20 confined.
21 A At that period of time, and I knew absolutely
22 nothing about the cost of the weapons or what commissions
23 were being earned by Iranian intermediaries, what
24 officials in Iran were paying for any of this equipment.
25 I had absolutely no knowledge.
DIffiJBSmi
493
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258
1 Q And In terms of the system, the scheme, the
2 program, that was not something Colonel North discussed
3 with you in this period of time?
4 A Not at the time, not in any depth. It was
5 clear that weapons — it appeared that Israeli weapons
6 were involved, at least during this time frame, were
7 being sent with at least the concurrence of the United
8 States in some respect — I'm not certain what — to
9 Iran, and that out of this was to come a release of
10 American hostages.
11 He spoke frequently of the need for broader
12 relations with Iran. He at that stage, I thought, had.
13 some strategic ideas that I am sure Mr. McFarlane had
14 impressed upon him. But detailed, you know, how much
15 equipment was shipped, what equipment was shipped, what
16 did the Iranian intermediaries charge the Iranian
17 government, until I met with Mr. Furmark, I guess in the
18 October-November time frames, I think that's when I had a
19 broader view of the actual costing, although I'm sure
20 you'll get into questions of cost because I started
becoming aware the cost^^^^^^^^^^^^^^^^^H
I^^^^^^^Hin the June-July time frame.
23 And that's when suddenly things seemed to be
24 going awry. I was quite surprised over that, plus other
25 indicators which I've testified to. By late August of
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1986 I was worried that things were amiss.
Q But so we don't lose focus here —
A I don't want to lose focus. I wanted to say
when I became aware. Back in that time frame, Mr. Kerr,
I just want to tell you I was so focused on hundreds of
other things that this was an extra duty, took an extra
hour or two, took a lot of weekends. Every tineH^^B
[l came in, whether it was 3:00 a.m.
or 2:00 a.m. to read the darn thing, then had to either
stay at the office and work on it. So it was a very
exhausting and onerous duty, in fact.
Q ' Let me back out so we can come into focus.
What I'm looking at right now and what I'm interested in
is the decisionmaking process that's going on in December
of 1985 and I'm trying to identify the players and roles.
Your role in December of 198 5 is to help Colonel North
essentially
gathering of information.
A ^^^^^^^^1 tasking]
Q What I am interested in is the evolution of a
decisionmaking process in this period of time and what I
see as a meeting on the 7th of December that McMahon
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UNOUSSfflfD
260
1 attands with tha Presldant, which rasults in McFarlana
2 going to link up with North and Ghorbanlfar In London.
3 You knaw that they wara going on that trip, but you
A raally didn't know why.
5 A I knaw that Colonal North was going. Z don't
6 recall that I knaw Mr. McFarlana was going. It was to
7 discuss the fallout that had occurred after what Colonel
8 North had described as a very disastrous meeting in
9 Geneva, and he was bitterly disappointed, very downcast,
10 and he came back and was still not happy with the results
11 of that meeting, because I believe Mr. McFarlana had .
12 expressed serious doubts about the wisdom of continuing
13 the effort through Mr. Ghorbanifar.
14 And Z assumed at that stage that the
15 initiative probably was dead and I ran into Colonel North
16 a few days later, I believe at the Department of State,
17 and he indicated that the initiative was back on.
18 Q You're going to lose me if you move too fast.
19 Where Z am is London, December 1985.
20 A The seventh.
21 Q Right. And at that point you're trying to
22 help Colonel North^
24 —---=-
25
UNCt^StFtFn
496
MblSSffi
261
1 Presidential meetings at this point. There is a meeting
2 that McMahon has on the 7th of December that he attends.
3 • There is another-meeting that afS^rently occurs on the
4 10th of December thati^asey attends. -I needHbe know the
5 extent- to^whiph you were d«±rtg the kind "©*: staff ing work
6 that CIA <^es o^jplping McMahoi^^t^ready to asst with
7 the Pzasldenl^^n the 7th. i^ tafejg^^ping Caf«]g^o (^1%^.
8 ready to meet with' the President on the 10th of December.
9 And I think what you're telling me is that you
10 really were not playing a staffing role to McMahon or
11 Casey in that period of time.
12 A To the best of my recollection, I did not
13 assist either in preparing them for the meetings on 7 and
14 10 December.
15 Q So in terms of what they were telling the
16 President and how they were reacting to what the
17 President was doing, you can't help me with McMahon and
18 you can't help me with Casey in this time frame; is that
19 right?
20 A Not in that time frame.
21 MS. DORNAN: I'd like to follow up on North's
22 reaction to the London meeting. Even though he thought
23 the meetings were disastrous, why was he then
24 disappointed with McFarlane's negative reaction? What
25 made him think the initiative should continue?
UNCDISSIFIED
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1 THE WITNESS: What made —
2 MS. DORNAN: North.
3 THE WITNESS: I really don't recall. He felt
4 that he waa convinced.„that a release Jaad occurred of
5 Reverend Benjamin t»*ir, that-Mr. Ghorbanifar did hav«
6 extrao^^inariLysgooA conta^^^n th« Iranian government^
7 regardle«« of the fact ^EjSffiiAJ^very control laBla, ^at
8 this was our only link to continuing efforts to free the
9 hostages, which Colonel North thought waa a worthwhile
10 objective in itself.
11 -^ ,^gaA^^^»^,ol<^g^ North, ragSifdlaaa of iirhat ^is-
12 said in t|^presri^lxi hw**n»- bro«|iEt yii^of the '
13 prob^M of seu^^tf^Asia tStd the polR^y^^acuum that^V
14 exists between the U.S. and Iran. He was just
15 disappointed. He said that Ghorbanifar had represented
16 himself well at that meeting and stated that the United
17 States needed to find ways to get closer to the Iranian
18 government because he was fearful that radical elements
19 which he considered pro-Soviet — and indeed many of them
20 are pro-Soviet — might become predominant.
21 And I recall some anguish on the part of
22 Colonel North upon his return. But then later — I don't
23 want to get ahead of Mr. Kerr — he indicated that the
24 initiative would proceed, and that could be after the
25 10th of December.
UNCtASStnED
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1 BV MR. KERR: (Resuming)
2 Q Your conversations with North upon his return
3 on the 9th of December would have taken place at that
4 time, the 9th of December?
5 A About that time. He had just returned.
6 Q And you would have talked to North face to
7 face?
8 A Yes.
9 Q Face to face?
10 A In his office.
11 Q Who would have been with you at the time you
12 met with North?
13 A There was someone else with d«.
14 Q Do you know who it was?
15 A No, sir, I don't.
16 Q The context that you were dealing with North
17 was what? What were you talking to North about? Why
18 were you there?
19 A 1 think it had to do ~ I don't know. I don't
20 know. I don't remember. I talked with North about many
21 counterterrorist activities. I assume it had to do with
22 some other — I don't think I went there just to get
23 debriefed on this trip because he could have told me that
24 on the telephone.
25 Q You were not or were you — when you met with
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UNeUSSfFIED
264
1 him, would it have been the 9th of December?
2 A Around that time. He had just returned, and
3 don't hold me to a specific date, please. But he had
4 just returned.
5 Q And the conversation that you had with him
6 about the meeting in London would have been just a
7 passing remark, a glancing blow?
8 A No, it was a serious conversation for a period
9 of minutes where he indicated he had met at some home —
10 and that was when I learned that McFarlana had joined him
11 — and that the conversation had not gone as well as he
12 expected and that Mr. Ghorbanifar had expressed anguish
13 that Mr. McFarlane was backing away from the initiative,
14 that he was condemning Iran to possible Soviet
15 penetration in future years.
16 And the Colonel was tired and disappointed.
17 Q Were you aware at the time that you met with
18 Colonel North, when he told you these things, that Casey
19 would be meeting with the President to also discuss and
20 review what had happened in London?
21 A No, sir. Colonel North did not indicate to me
22 that he knew such a meeting was to take place.
23 Q And Director Casey likewise had not advised
24 you or talked to you about a meeting that he was going to
25 have with the President?
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265
1 A To the best of my recollection, Bill did not
2 talk to me about it.
3 Q Again, just to try to move things into focus,
4 let me show you a memo which I gather from what you're
5 telling me you probably didn't see. It's Bill Casey's
6 memorandum of 10 December directed to the Deputy
7 Director, Mr. McMahon, which will be Exhibit 19.
8 (The document referred to was
9 marked Allen Exhibit Huober 19
10 for identification.)
11 I'd like you to look at Exhibit 19 primariJLy
12 for the purpose of trying to focus your recollection an
13 what you would have known about events at the White House
14 on this Iran initiative at this time.
15 (Pause.)
16 A I have never seen the nemorandua until now.
17 The first paragraph, McFarlane's impressions of
18 Ghorbanifar, coincide with what Colonel North had stated.
19 I don't recall Director Casey talking to me about this
20 meeting of 10 December, although I did hear him say at
21 some point that it was hard to constrain the Israelis,
22 that they would tend to proceed in some way regardless of
23 what we do to comt^s^ th«
24
25
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UNCWFIfD
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1 Paragraph 3, Colonel North raisad that at the
2 Operations Subgroup meeting of the TWIG,|
3
4
5
6
7
8 Q Okay. Mr. Casey's memo suggests to m« that at
9 this point the Iran initiative was at low ebb.
10 A Ves, sir.
11 Q But that Bill Casey thought that something,
12 still might turn up.
13 A And the President was still essentially in
14 favor of trying to find something, and that's precisely
15 what Mr. McMahon told me on the 16th.
16 Q That's precisely what he told you on the 16th,
17 and you've hit a time window which is very important to
18 me, which I want to try to focus you on. It looks to me
19 like on the 10th of December a lot of people thought
20 things were at low ebb, yet we know they come back to
21 life. What I want to know is what you knew from talking
22 to North at that point about where things stood.
23 A Well, after I talked to him at the White House
24 in his office I accidentally, and purely accidentally,
25 ran into him in the Department of State just at the
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entrance, the C Street entrance, shortly after the 9th or
10th of December. And he smiled, and I said, you're
smiling. I said I thought everything was ol
And he said the initiative is back on. He
said there has been a discussion with the President and
that the initiative will continue.
Q What, if anything, did you learn at this
conversation or from any other circumstance that caused
the change, the shift?
A He indicated there had been a discussion in
the Oval Office.
Q By whom, with whom?
A He didn't say. He said he had been in
attendance, I believe, and that the President had
approved of continuing to utilize — I shouldn't reach.
I don't recall whether he said that the Israelis would
continue to be involved or not. He just said the
initiative would continue. It was a brief conversation,
VNetftSStFtED
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1 but Colonel North's attitude and outlook was quite
2 different.
3 Q And the contrast is between your impression of
4 his attitude as of 9-10 December and something which had
5 occurred a few days later?
6 A Yes, sir.
7 Q And it turns out what precisely had caused the
8 change? You don't know what it was?
9 A Except that he stated the President had
10 approved continuing the initiative, the President of the
11 United States.
12 Q Now let's go to December 16 and a meeting with
13 Mr. McMahon. Again, your recollection is that you met
14 with McMahon and had some discussion with McMahon about
15 the status of the Iran initiative; is that correct?
16 A I was traveling with Mr. McMahon because Mr.
17 Casey was not available to attend the Vice President's
18 meeting with Agency heads on the report that he was
19 submitting to the President on steps that must be taken
20 to improve our counterterrorist strategies and programs.
21 So I rode with Mr. McMahon and we talked on the way down
2 2 and on the way back about the Iranian initiative.
2 3 He did not, to the best of my recollection,
24 talk about any meeting the Director had had on the 10th
25 of December, but he talked about the^m^^ing ha had ^_
UNCtKSSm
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1 attended in the Oval Office on the 7th of December with
2 the PresidiSfeV Secretary of state, I think the Secretary
3 of Defense, McFarlane.
4 He stated that he had expressed serious
5 reservations, I believe, at that time about Ghorbanifar,
6 about the intermediary involved, concern over the Israeli
7 involvement.
8 Q You lost me for a second. You said that he
9 expressed reservations about Ghorbanifar and then you
10 said and the intermediary. Are we talking about the same
11 person?
12 A ■ The intermediary involved, the Iranian *■
13 intermediary involved.
14 Q That would be Ghorbanifar?
15 A Yes. And that the conversation had gone on,
16 if I recall correctly, for an hour and a half, which was
17 an extraordinarily long discussion. He seemed
18 displeased. He said that Kimche was involved, Schwimmer
19 was involved. He felt — he didn't say so in so many
20 terms, but I gained the impression that he felt that the
21 Iranians were trying to unduly influence the United
22 States in this regard and that hostage issues had deeply
23 affected the President.
24 He spoke very respectfully of the President,
2 5 said that the President was very strong in the meeting.
UNet/tSSIFIED
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(W6USSIFIED
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1 And it was his impression at that meeting that the
2 initiative would continue.
3 Q And again he is still talking about the
4 December 7 meeting?
5 A Ves, sir. He did not, to the best of my
6 knowledge, ever mention the 10 OaoifflMr meeting. He said
7 that he told the President that if it was important to
8 continue the initiative that the Agency would support the
9 Executive Branch and the President, as is the Agency's
10 duty to do so, but that a Presidential Finding was
11 absolutely necessary.
12 Q Did you apprise Mr. McMahon of the fact that
13 you had met with Mr. Ledeen on the 4th of December?
14 AX think I did. I think I said Mr. Ledeen had
15 indicated that Kimche was involved and that this was an
16 operation utilizing the Israelis. Also, I think I
17 probably apprised him that Mr. Ledeen had sort of been
18 put to on* side by Admiral Poindexter, that Admiral
19 Poindexter at this stage, as I recall, was taking over as
20 National Security Advisor.
21 But we did not dwell on the conversation with
22 Mr. Ledeen. We talked at great length about — he asked
23 a lot about]
24
25
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1
2 H* said who is Battery, and at that stag* I
3 said I believ* that that refers to the vice President,
4 but actually it's a code name used by Colonel North, that
5 there had been an agreement by someone at the White House
6 that somehow Ghorbanifar would be led to believ* that
7 somehow the Vice President himself was behind the
8 initiative, and, to the best of my )cnowledge, Ghorbanifar
9 never met with the vice President and this was simply .
10 sort of a ploy to push Ghorbanifar harder to make it
11 succeed.
12 Q As of the time of this December 16
13 conversation that you had with Mr. McMahon, did you know
14 that Director Casey would be meeting with Mr. Ledeen
15 subsequently on the 19th of December?
16 A I knew that Mr. Ledeen was_seeking an audience
17 with Director Casey.
18 Q Did you discuss that with Mr. McMethon?
19 A No, sir, not to the best of my knowledge, Z
20 didn't.
21 Q Did Mr. McMahon indicate that he was familiar
22 with or knowledgeable of Mr. Ledeen?
23 A I know at some point he mentioned Ledeen, but
24 I don't know that there were any comments in that
25 particular time frame. I know that he had some concerns
liNCtHSSIFIED
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1 over Mr. Ledeen's role, but I don't recall —
2 Q Do you remember what those concerns were?
3 A That here was an individual, very bright,
4 extremely able, but he felt that perhaps he was too
5 single-minded in his pursuit of this and that he was
6 exceedingly close to senior Israeli officials.
7 But I want to make it very clear for the
8 record I don't know that he said that during that
9 conversation. I don't know he said that at all.
10 Q Can you place the subsequent —
11 A I can't. I really can't, and it wouldn't be
12 ;l^ir for me ^p^^«eulatfl^
13 MS. DSntWU^, Did'youjret a fe^Iin^ at this
14 tin*. th»t ^tore ««(ca any^di'ff«s^c«a b*tv«*n Mr. Casey
15 andr. .:Hr ;/-- HgMft&aj^^^^^^fc^^p.. ta^^JMBUtiva?
16 THE WITNESS: I think Mr. Casey was more
17 sancfuine <St tlA flfeitial efficacy of the initiative. I
18 believe that Mr. Casey believed that the President could
19 ride out any firestorm that could develop. He said to me
20 once, who is going to condemn the President of the United
21 States for trying to saw Aaaricans held in severe
22 captivity under se^reggtama^ons it^^poano^ 5^'^^
23 ?■ ^liE^ ''■'ff6aig<w3^»«>- at^^^fet^K^J^g" was my inqprfesion
24 that he did not relate that to something involving
25 diversion of funds to Central America. He was putting it
UNGtXSSIFIED
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UNGUSMD
273
1 only in th« context of Iran. Let me just finish, if I
2 may, please.
3 He spoke frequently about the need to find a
4 way to eventually have closure with this government of
5 Iran to try to check the spread of Shia fundamentalism,
6 which he felt was a great dynamic change in the Middle
7 East, particularly in Lebanon, potentially in some of the
8 Gulf states. He spoke very broadly of those very grave
9 problems of national security.
10 MS. DORKAN: Did you receive the impression
11 that Mr. McMahon attempted to influence Mr. Casey on
12 this?
13 THE WITNESS: I don't recall Mr. McMahon
14 speaking about Mr. Casey's view of this. I'll think
15 about it, but at this stage I can't think of it. -t'
16 ^^ BY MR. KERR: (Resuming)
17 Q Let me move yovuf^ittle further ahead. We've
18 talked about the December 19 meeting between Mr. Casey
19 and Mr. Ledeen. Vou at no time, I take it, spoke to
20 Casey about what transpired at his meeting with Ledeen on
21 the 19th of DecesOl^RHI
22 A I think I did. I think at some point Mr.
23 Casey told me, after the 19th meeting, that Mr. Ledeen
24 had indeed proposed this Libyan sting operation and that
25 it just wasn't going to happen,]
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Q Do you have a recollection or Icnowledge of the
role Ledeen played in the decision that Mr. Casey made to
instruct the Near East Division of the Operations
Directorate to do further evaluations of Ghorbanifar?
A The role that Mr. Ledeen played?
Q Yes.
A I don't know precisely. I know that in the
January time frame, after Mr. Ledeen, I think, learned
that Ghorbanifar had miserably failed the polygraph that
he was in touch with Mr. Casey and th^^t \^ when Mr. >
Casey called me one morning on secure and told me to move
out and cancel my appointments and go meet with
Ghorbanifar.
Q Let me sharpen up the focus. On December 20,
according tc^^^^^^^^Hand others in the Near East
Division of Operations, Mr. Casey did indicate that he
wanted the Operations folks, specifically the Near East
Division, to engage in a further evaluation of Mr.
Ghorbanifar.
A I've read the chronology.
Q In terms of how that came about, you are not
really sure what caused Casey to do that?
A The only thing that I know, I knew that Mr.
IINtt^SSIFIED
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lEUSSiED
275
1 Ledeen was to see Mr. Casey, and each time Mr. Ledeen met
2 with me or Mr. Clarridge or anyone else he always praised
3 Mr. Ghorbanifar, and I anticipated that he would strongly
4 urge that Mr. Casey endorse Mr. Ghorbanifar 's efforts.
5 So it's no surprise whatsoever.
6 Q The date that^^^^^^^H gives for when he was
7 first told to get in touch with Ledeen to try to set up a
8 meeting with Ghorbanifar is December 20, 1985. According
9 to the Director's records, that same day, December 20,
10 1985, General Secord met with Director Casey.
11 Do you have any knowledge of what transpired
12 at such a meeting on December 20, 1985, between General
13 Secord and Director Casey?
14 A Absolutely none. I wouldn't even have
15 recognized Mr. Secord if I'd seen him.
16 Q When did you first meet, if you ever did,
17 General Secord?
18 A 29 January 1986.
19 Q So prior to the January 29 meeting that we'll
20 cone to, you had no acquaintance with him at all?
21 A I did not know General Secord.
22 Q You knew him by reputation, newspaper clips?
23 You had some familiarity?
24 A No, I didn't. I worked in Defense, but I
25 didn't recall General Secord. He apparently is a very
liNI^IKSm
511
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276
1 bright officer who was headed for four stars but didn't
2 quite malce it.
3 Q In that regard, General Secord's involvement
4 in the Wilson matter, that was not something that you
5 were conscious of in December of '85?
6 A No. I was not conscious at all of it. I read
7 Manhunt by Peter Mass in the summer of '86.
8 Q But December '85 that was not something that
9 you had a conscious memory of?
10 A No. I tried not to read about Ed Wilson.
11 Q And the reason you tried not to read about Ed
12 Wilson is what? It was just a disagrceabl* matter? *
13 A I never knew of him, I never met him. I never
14 met him or Mr. Terpil, and I thought it was a bloody
15 disgrace, so I had no interest in that case.
16 Q Now let me move you again — we are inching
17 along here — December 21, 1985,^^^^H^H[apparently
18 got ahold of Mr. Ledeen to set up a meeting which toolc
19 place on December 22 of Ledeen .^^^^HHchorbani far,
20 Colonel North comes by, and the like. Did you know
21 contemporaneously? Did you know December 21, 22, 23,
22 that these meetings were taking place?
23 A No, sir. No one apprised me of then.
24 Q And as to the December 22, 1985 meeting, you
AC
25 had •■ contemporaneous knowledge of that meeting taking
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place at all; is that right, contemporaneous? You might
have known later?
A What was the date?
Q December 22, 1985.
A No, sir, I did not know it was occurring.
Q There was a meeting on December 23, 1985,
apparently attended by Director Casey about
impressions of Ghorbanifar. Vou were not aware of a
meeting taking place on the morning, that is a Monday, of
December 23?
A No, sir, know nothing about it.
Q I understand. There was a meeting that you
had wittJ^^^^^^^Band Colonel North on Christmas Eve,
the 24th of December.
A That is correct.
Q There was nothing about that meeting — the
reason I'm curious .^^^^^^^^His involved later on, as
you know,!
A No, sir. I met with Colonel North and|
[to discuss one part of the Vice President's Task
UNCmffiD
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mmim
278
1 Force for Combatting Terrorism. That was very sensitive
2 but had nothing to do with the Iranian initiative.
3 Q Let's go to the meeting at North's office on
4 the 24th of December 1985. During the course of that
5 meeting apparently there was some mention by Colonel
6 North of the Finding or something that you all took to be
7 the Finding. Can you give me again your best
8 recollection of what transpired in that regard on the
9 24th of December, 1985?
10 A At some point, I think at the beginning of the
11 conversation, before we began to discuss the other
12 matter, Cdlonel North thanked^^^^^^^^^^for some of "the
13 work that had been under way by Mr. Sporkin and other
14 members of the Office of General Counsel on a Finding
15 relating to the Iranian activity, and he wanted^^^^
16 ^^^^^^B^° convey his thanks back to Judge Sporkin.
I thin)^^^^|H^H indicated that some work
18 was under way at that time and Colonel North made a
19 cryptic reference to the effect the President has signed
20 one Finding. There's only one copy, and it's locked in
21 By safe. ^^^^^B^| took that to mean that that was a
22 Finding that was prepared after the 24-25 November flight
23 into Tehran and that it would sort of be retroactive and,
24 I guess, covered future activities. I had not seen the
25 Finding even in draft.
UNttlSStRFD
82-688 0-88-18
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UNKASSiED
279
1 But then we passed on to discusB oth«r matters
2 and that was about the extent of the conversation. And
3 reconstructing the chronology of that and when we were
4 trying to do the chronology in the November 198,6 tine
5 frame I^^^^^^^^^Hv is i ted me and he had forgotten about
6 that, but then he recalled it and actually found a draft
7 of the Finding in his safe, and he then, as his memory
8 was refreshed, even in my presence said that he thought
9 it could have been a Finding that had been sent to the
10 White House by the Director in early December '85.
11 Q Let me just block out the Finding process.
12 There has been a suggestion by ^^^^^^^^fthat she
13 thought possibly you and Mr. Clarridge had been assigned
14 responsibility by Mr. McMahon, which we talked about the
15 other day. You have no further recollection of that
16 assignment other than what you testified the other day,
17 which was that you had none; is that right?
18 A I have absolutely no recollection that I had
19 any responsibility to pursue that Finding, which I had
2 0 sort of heard rumors was being prepared, to pursue it
21 with Colonel North or with even people like Admiral
22 Poindexter to ensure that it had been signed. I don't
23 think that that was my responsibility. That's the
24 responsibility of the General Counsel, as Z see it.
25 Q Just to nail it down, there is a reference in
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Inotes of December 5 for Mr. McMahon that he
had been told by somebody — there's a suggestion even
that it was
A I'm sorry. Who?
^^^^^^^^^^^^^^^^^^^1 a reference
in the note to^^^^^^^HH^|possibly being the source of
the information on the 5th of December that the Finding
had been signed. Again, you have no recollection of
knowing that early, December 5, of a Finding being signed
by the President; ia that correct? — ""_
A I don't have any recollection at all. I have
no knowledge of it being signed on the 5th.
if I can clarify what you're saying, has testified or has
written a memorandum which said that Mr. Clarridge and I,
she thought, were possibly responsible to pursue with the
White House this Finding to ensure it was signed.
I have no knowledge of that whatsoever.
MR. WOODCOCK: I don't think it's a
memorandum. Chuck, is it in that memorandum?
MR. KERR: No. As a matter of fact, the
memorandum is under, what it says is that under the
heading of what^^^^^HBwas talking about, then there's
a subsequent note of December that says McMahon doesn't
know who said these things.
MR. WOODCOCK: I think just to make the record
lINetAmiED
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IINGtMSIFIED
281
1 clear, I don't believe that^^^^^^^^^^^^l comments were
2 ever — with respect to the possible tasking of Mr.
3 Allen and Mr. Clarridge to find out whether the Finding
4 had been signed was ever memorialized in a memorandum.
5 Those were simply oral comments.
6 BY MR. KERR: (Resuming)
7 Q So we don't further confuse matters, the
8 bottom line is that you simply have no recollection of
9 being involved with the responsibility in December 1985?
10 AX have a lot of responsibilities, but making
11 certain the President signs Findings is not one of them.
12 Q One last passing note on the Christmas Eve >-
13 meeting with Colonel North. Do you recall being aware
14 that Colonel North had met just prior to meeting you with
15 certain Israeli ofj
16
17 A Yes, sir.
18 Q Do you have any knowledge of discussions that
19 Colonel North would have had with those officers? Do you
20 know what he was talking to them about?
21 A I think he was talking to them about hostage
22 issues. I just briefly was in the office just as they
23 were leaving. It was Colonel Moshe" Zur and General —
24 you'll have to help me; I know him. He is retired now.
25 Oh, General Yuri Simhoni and Colonel Moshe Zur.
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Q Do you have any knowledga of discussions that
Colonel North would have had with these two Israeli
officers relating to Mr. Ghorbanifar that evening?
A No, sir, none at all.
Q with regard to Mr. Ghorbanifar, you became
aware that a polygraph of Mr. Ghorbanifar was 1^ the
works at what po^flt-in tlm^-jg- Paeambar '85, January '86?
A "^ SoBwtiBqj^yt January , Z believe. Someone
mentioned that that was occurring but I can't recall the
precise date. _^ _,,-^.- —^
Q Do fW. reeeti^ whci iiMg^^Ma it to^u?
h - No> I don '^"^^6~ recall that the first
specific recolIect^ljtJajdib.was ^ Januiry^Bhen th^
Director called ne.^-^^ - -^= ~ ""'"
Q Your relationship with Mr. Ledeen as of that
period of time was what? Had you developed any kind of
ymsstUD
518
UNCLA^^^tl
283
1 social relationship with him?
2 A No. I did not know Mr. Ledeen. I had never
3 met his family or anything.
4 Q Had you been to his home at that point?
5 A No, never been to his home.
6 a. _At any li^»? - ^^^ ;^ ■*' — -^^ ^; ■
7 -A -r N«v»r pri«r to^l3 January. ' - i_
8 Q--^- And in tery* «i: Mating with ICE>..Ghorbanifar,
9 had you'Sftt vj^sgTIir. GhottanifM^^^r to -|3 Jj^nuary ^^
10 1986? — ^-'^^^■■' — «EU;. — ^^fiag. -- -
IX A Never. What date is the 13th? That'* a
12 Monday? I think I had met him on Sunday afternoon
13 briefly at Mr. Ledeen 's home. He had asked me to come
14 over socially. ^^
15 MR. WOODCOCK: January 13, 1986 was a Monday.
16 THE WITNESS: Okay. I met him on the 12th.
17 BY MR. iSSS^ (Resuming)
18 Q The Sunday?
19 "A For about an hour, so that was the first time
20 I'd been to Ledeen 's house.
21 Q With regard to the memorandum prepared by the
22 Operations Directorate on the meetings that^^^^^^^^H
23 had with Mr. Ghorbanifar and others, did you have
24 occasion to review that memorandum at that time, during
25 that period of time?
URCLJKSra
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284
1 A The morning of the 13th of January, prior to
2 meeting with Mr. Ghorbanifar?
3 Q Yes.
4 A I don't think so, not to my knovladg*.
5 -_ , Q _ Have you ever reviewed the memorandum that was
6 prepared of the December 21, 22, 23 meetings?
7 A Which involved the polygraph?
8 Q This is prior to the.-polyqraph .
9 A No, I don't think so.
10 Q Let me show you a memorandum referring to
11 those meetings, which will be Exhibit 20. That was
12 prepared by the Chief of the Hear East Division on th^^
13 meetings, which we now know to be by^^^^^Hwith
14 Ghorbanifar on December 22, also with Ledeen.
15 (The document referred to was
16 marked Allan Exhibit Nuaber 20
17 for identification.)
18 Could you look at that memorandum. Exhibit 20,
19 and tell me if you've ever seen it before?
20 (Pause.)
21 A No, Z don't believe I have ever seen that
22 prior to this moment.
23 Q At any point in time have you had occasion to
24 meet witl^^^^^^^^^and discuss with him his
25 impressions of Messrs. Ledeen, Glii^rbanifar, North which
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are related to some extent in this memorandum?
A Have I discussed —
Any of these matters withi
That are mentioned in this?
Correct .
Well, let me read the memorandum, I guess,
first; then let me respond.
(Pause.)
I have not seen the docviment before. I had
with^^^^^^^^H I know with^^^^^^^^H
think I've ever discussed the specifics of this document.
W« have discussed -- and I can't recall when these '
conversations occurred, but certainly in the winter and
spring of calendar year '86. I think there had been
comments to the effect that Mr. Ledeen jjimjitn .tlUXP ^^
uiiddV Bflniration of Mr. Ghorbanifar. This paragraph
dealing with overcharging the Iranians and that $200,000
had been used to support Ghorbanifar'* JAlri^^^^^ contacts
inside Iran, that's very new information. I've never
heard that from anyone. :#" ^ i
Q ""^fg^Mf • ISTT-' ^|*-^in^. I U4^(9L to yiait
with you. You don't recall having discussed with^
this specific information?
A In this specific paragraph. No one ever
mentioned it to me from anywhere in the Agency, and
IS]
521
UNeU^IES
286
1 neither has Mr. Ledeen, I might add. That's the type of
2 thing that would stand out in one's mind.
3 Q I want to ask you a series of questions.
4 Rather than do it piecemeal, let me show you a cable from
5 the late December period of time, and the cable, my
6 impression is, seems to relate to information that you
7 developed at your December 4 meeting with Ledeen and
8 clearly makes reference to what was then the anticipated
9 lie detector test that was going to be taken of
10 Ghorbanifar.
11 I want you to look at it not simply to
12 familiarize yourself with the fact that it went out and.
13 to tell me whether or not you knew about that, but
14 because it suggests to me that there must have been or
15 there may well have been discussions between you and
16 Operations personnel during this period of time on the
17 information that you and they had gathered from Ledeen
18 and Ghorbanifar.
19 So if you look at it, again kind of a way of
20 refreshing your memory on the events, and then maybe you
21 can tell me if you recall discussions that you would have
22 had with Operations personnel on Leqtftijfcfc^ Ghgrbanif ar^^
23 conte^p^ in D«^wto«r^_of iSjP-_jK« ^3H^b« Ixhtbit-ii.
24 ^ ^ 'jiuf'i'' ^^« TThe^^tMBiL^gTrad to' vi»
25 ~ i^rlcwPltlXi^-BihibAt Muabar 21
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uNemRED
287
for identification.)
A This went out on 27 December 85.
Q Correct. I don't know if this document will
be of any assistance. This is the decoding of identities
which seems to relate to that cable. We'll mark that 22.
(The document referred to was
marked Allen Exhibit Number 22
for identification.)
You've got to forgive me on that, Mr. Allen.
The Tower Commission said it was having trouble tracking
what really happened in December of 1985, which has
inspired me to try to figure it out on my own.
A Well, there was some information passed to me
by Ledeen,^^^^^^^^^^^^|^mH^^^^^^^H as
you recall, and there was information that^^^^^^^^^^H
land that inspired, I
think, soma^^^^^^ri activity, I believe while Mr.
Clarridge was in Europe, because I think I was talking to
One of the reasons I was interested in
checking this out was to see if this guy Ghorbanifar
really had any information at all of any value, and I
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remember Mr. Clarridge came back and we talked briefly
about the information that had been provided by Mr.
Ledeen, which he had obtained from Mr. Ghorbanifar, and
Mr. Clarridge said something's going on^^^^^^^^Hbut we
can't figure it out.
Q Let me just kind of break it down. Mr.
Clarridge apparently was out of pocket and the
information we have apparently was|
A He was]
Q The last two weeks in December.
A Sir, I take back my original statement. I
know he went|^^^^^|Hbecause we talked about this
information when he returned and ha said he had beer^H^B
[and had talked to H|^|^^H about the
information.
Q Taking it a step along, it appears to me that
at least some of the information that you had developed
on your December 4 meeting with Ledeen had been passed to
Operations.
A Yes. I made that immediately available. I
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think Mr. Clarridge was leaving that day for Europe. I
gave ^°^^^^^^^|B ^ ^^^'^ ^ think you ought to
send this sort of^^Hto Europe to make sure Mr.
Clarridge sees it, and see if]
[obtain any verification of this information.
Q Now Clarridge comes back, from what I gather,
in mid-December from his trip. It was apparently an
eight to ten-day trip|
A Yes, sir.
Q You would have then talked to Mr. Clarridge at
that point when he came back?
A I believe I did, briefly. ■^•
Q And at that time — and again w« know your
memo was December 18 , so you would have had a writing in
mid-December which went through in some detail your
meeting with Ledeen — you would have shared that
information with Mr. Clarridge; is that correct?
A Yes, sir. ^
Q Can you tell from this cable whether this was
generated through the good offices of Mr. Clarridge or
him in conjunction with the Near East people as well?
A I believe this must have been — I'm sure it
was signed off on by the Near East people. It looks like
some of this I did not obtain. When you get over here to
page 3 , that clearly was!
and others
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collecting. It appears, looking at this, I would assume
that — we don't have the originating office, but it
certainly was coordinated carefully between the European
Division and the Near East Division. Those things are
highly coordinated.
Q Looking at the references at the top —
A It would be the Near East Divisioi^^^Hthat
had put it together and clearly the European Division
shared the information that Mr. Ledeen had provided or
they nay have actually made a contribution in the
preparation of the cable.
Q Can you now, with that again as a way of
focusing your recollection, tell me if you have a
recollection of discussions that you would have had with
Near East Division personnel, eitherl
A I didn't discuss this infonnatl«il%S9i «ither
then. do believe^^^Hj^^HH said that
something might be going on, but I remember clearly Mr.
Clarridg* saying that!
Q Is it fair'tb say that one can at least draw
the inference from this material in this cable that at
least portions of the materials that you developed in
your December 18 memo from your DecemJser 4 conversation
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war* baing clrculatad through tha Oparatlons Dlractorata
In Dacembar of 1985?
A I don't know. Well, I would assume that, yes,
some of the people had seen that memorandum in tha Near
East as well as the European Division. Tha European
Division got a copy immediately.
Q All right. But in terms of meetings or oral
communications, you simply do not have a recall of having
such discussions with tha Near Eastern people?
A Not in the December time frame in reference to
the specific types of requests from headquarters to the
field to look into certain activities.
Q Now let me go another step. In your testimony
to the Tower Commission you apparently told them that you
had an understanding that Mr. Nir had come to Washington,
D. C. in December and been briefed by Colonel North on
December 23 on the Iran initiative. Do you recall
telling the Tower Commission that?
A I think he was here about that time frame.
You know, I believe that Mr. Nir became involved right in
the December-January time frame, and I remember Mr. Nir
made a visit to this
527
UMCUSMD
292
1
2 Q Let me read the excerpt from th« report,
3 because what I really want to get a flavor for is the
4 extent to which you knew that Nir was being apprised of
5 U.S. thinking, if you will, as a result of the McFarlane
6 visit in December. The excerpt from the report says:
7 Charles Allen told the Board that he understood that Nir
8 came to Washington in December and North briefed him on
9 December 23 "on this initiative" — that is, on the
10 program in light of McFarlane's meetings in London. And
11 there's a reference to your transcript.
12 In late December Allen gave the NSC staff «
13 copy of the August 1984 CIA burn notice on Ghorbanifar to
14 the effect that he was a fabricator. And then there's
15 also the reference to the North meeting with General
16 Simhoni and Colonel Zur on the next day, December 24.
17 And with that way again of focusing your
18 recollection, can you tell me what you knew in late
19 December about the Israelis, North and the Iran
20 initiative?
21 A That throws a lot of sins together in one
22 statement. I believe Mr. Nir was here in the December
23 time frame and the reason December 23 sticks in my mind,
24 at some point I believe Colonel North in November, when
25 he was putting together a chronology —
imetASStFIED
528
ONCU»ED
293
1 Q November '86?
2 A November '86, the NSC chronology, I believe he
3 said it was the 23rd of December when he actually brought
4 Nir into the operation. I only have his word for that.
5 I do recall having a beer with Mr. Nir at the Key Bridge
6 Marriott around that time.
7 Q It must be a nice watering hole.
8 A No, sir, that was in Great Falls. Great Falls
9 is much nicer. So during that meeting I was paged by
10 Colonel North. I called him and I believe he was at the
11 White House and he said he had to talk to Nir, and I
12 believe there was a conversation, and I don't know what
13 the substance was, but Mr. Nir had accompanied Defense
14 Minister Rabin to this country and Rabin was in
15 California.
16 And Rabin made some calls to California. The
17 substance of the conversation, IUdB't Im^:. They spoke
18 in Hebrew.
19 Q That's makes it tough.
20 A I heard it, but I certainly couldn't translate
21 it for you. That gave rise, in my mind, in addition to
22 what I saw in the NSC chronology in November '86, that
23 Mr. Nir certainly at that stage had entered into this
24 inner sanctum of the very few people that were aware of
25 this extremely sensitive NSC initiative. We didn't
UNtUSStFHD
529
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294
1 discuss it. He was not willing to convey any intonnation
2 as to what Colonel North wanted or why he called Defense
3 Minister Rabin.
4 Then he called Tel Aviv. Okay?
5 Q All right. The other juxtaposition of events
6 in that paragraph is the statement that you passed on to
7 the NSC the Ghorbanifar burn notice at about this period
8 of time. First off, do you recall doing that?
9 A Well, yes. I had had it for some time, I
10 guess, after it became apparent that someone said that
11 this was Ghorbanifar and there was a bum notice.
12 Someone in the Directorate of Operations gave it to oe,
13 and Colonel North called and said he wanted a copy of the
14 burn notice, and he claimed he didn't have one at the
15 time, so I sent him a copy.
16 Q In that cortnection, when you talked to North
17 about his request for the burn notice do you recall
18 discussing with North him having been told of the
19 Ghorbanifar burn notice by^^^^^^^Hback in early
20 November?
21 A Well, I think I knew that he had been told. I
22 didn't know what time frame.
23 Q Did you know by whom?
24 A I wasn't certain. It could have been^^^H
25 ^^^^^^B yes, but I don't know that. Let me be very
mtrnmi
530
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295
1 clear. I knew that Colonel North knew there waa a burn
2 notice and that the Agency had a very poor opinion of
3 this source. I thought Colonel North had a copy of the
4 burn notice, but he claimed if he did he couldn't find
5 it, and he wanted a copy. So I just had my secretary
6 send a copy to him.
7 Q And as to who had talked to North about
8 Ghorbanifar's history as known by the CIA, you didn't
9 know that in December; is that right — or you did know
10 it but you don't know now?
11 AX can't say specifically who first discussed
12 the Ghorbanifar problem with Colonel North. ^^^^^^^^^H
13 as I said, when we had lunch, whenever it was in
14 December, in January, we spent a good deal of time
15 talking about Ghorbanifar and^^^^^^^^^lexpressed great
16 concern about the use of this man.
17 Q Now your discussion with^^^^^^^^H at lunch,
18 I want to put up a divide, would that have been before
19 the January 17 Finding or after the January 17 Finding?
2 0 A I think it was before. As I recall, it was
21 before.
22 Q And^^^^|HH| during the course of this
23 lunch is expressing his concern, dismay, something of
24 that sort about Ghorbanifar; is that correct?
25 A That's correct.
531
wMsm
296
1 Q Did you have occasion in this latter December
2 period to discuss with North what the role of the
3 Israelis was, what Nir was doing, what the General and
4 the Colonel were doing, what the Israeli agents were
5 about?
6 A At some point I did, but I can't say it was in
7 December '85 time frame. It could have been in January.
8 It was clear that Amiram Nir was entering the picture in
9 some capacity to represent the Israelis because Colonel
10 North at some point after the dismal failure in Geneva
11 had indicated that he attributed it not just to the
12 Iranians but to Mr. Schwimmer and Mr. Nimrodi, that he
13 felt they had not been totally honest.
14 Q Honest about what?
15 A Well, about what was being shipped. But I
16 have never learned all the details of that. But it was
17 clear that the Iranians thought they were getting a
18 different model and they got an older model. Colonel
19 North wanted a more reliable intermediary and said he had
20 arranged for this to occur, and I don't know with whom.
21 Clearly he had to go to high echelons of the Israeli
22 government to have performed such a feat, to get Amiram
23 Nir involved.
24 Q Hang on, Mr. Allen. Colonel North said he
25 wanted a more reliable intermediary*
UimSSIFIED
532
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297
1 A On the Israeli side.
2 Q Which intermediary are we talking about?
3 A On the Israeli side.
4 Q He wanted someone more reliable than Schwimmer
5 or more reliable than Nimrodi or what?
6 A Both. I don't think he had confidence. I do
7 not believe he retained confidence that Mr. Schwimmer and
8 Mr. Nimrodi would perform well. Clearly Mr. Ledeen had
9 been put to the side by Admiral Poindexter, as I
10 described earlier, so Colonel North had first met Amiran
11 Nir in August of 1985 when he arrived here as the special
12 assistant to the Prime Minister on counterterrorism. -
13 That's when I first met Mr. Nir. And he and Colonel
14 North immediately had excellent rapport.
15 Q So it was your impression — am I correct that
16 it was your impression that Colonel North had asked the
17 Israelis to come up with somebody other than Schwimmer
18 and Nimrodi and had expressed a preference for Nir; is
19 that what happened as you understood it?
20 A It would be my judgment that that's what
2 1 occurred .
22 Q And that's a judgment not based on what
23 Colonel North or anybody else had told you but inferences
24 you drew from the circumstances?
25 A And the fact that Colonel North, at least in
IINCOtSSIFIED
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298
1 th« January time frame, I believe, indicated that Mr. Nir
2 was becoming involved as part of this very small number
3 of people in the United States and Israel that knew about
4 this initiative.
5 Q Now by virtue of the fact that you had sent
6 the Ghorbanifar burn notice to Colonel North I assume
7 that means that you'^tfraad it? ^^^ ^' —
8 A Z read' it very carefully, si;.
9 Q An^you weuld^ladSpiyw^tainlliarizadi-yoursalf ,
10 at least in a general waijp jiriSh the Ghorbanifar 201 by
11 that point, correct?
12 A • I don't think I had looked at his 201. It«-s
13 not that it was denied to me. I just didn't bother.
14 Q Tell me what had happ«9ad. You simply asked
15 for an excerpt, the burn notice, from the 201 rather than
16 the entire 201?
17 A I guess I just asked^^^^^^^^^to get me
18 copy, and I think he sent a copy over.
19 Q Given that and what you must have known about
20 the Operations Directorate's attitude towards
21 Ghorbanifar, what was your own sense or impression of
22 Ghorbanifar as of late December 1985?
23 A What was my impression?
24 Q Yes.
25 A I had not met the man. I had conflicting
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299
1 testimony from Mr. Ledeen and the Operations Directorate.
2 I had not formed any strong opinion one way or the other.
3 I simply sent the burn notice down to Colonel North for
4 his view.
5 Q Bear with me. You heard Ledeen had met with
6 Ghorbanifar and you heard what he thought of Ghorbanifar,
7 and he thought Ghorbanifar was good, right?
8 A And Colonel North had met Ghorbanifar.
9 Q What did Colonel North tell you by way of
10 impression of Ghorbanifar as of December '85?
11 A I think he had doubts as to the man's total
12 reliability, but it was my impression, if that's the .
13 right phrase, that Colonel North felt that with enough
14 effort that Ghorbanifar could be managed to some degree,
15 and I think that of course the fact that an individual
16 who in many quarters is highly esteemed, David Kimche,
17 had recommended Mr. Ghorbanifar.
18 Q How did you know that?
19 A Mr. Kimche is well known.
20 Q I know Kimche is well known. How did you know
21 Kimche 's view of Ghorbanifar?
22 A Because of what Mr. Ledeen had told me and
23 what Mr. McMahon had affirmed, and also Mr. Casey, as you
24 recall, on 11 October had talked about Kimche and
25 Schwimmer, as I recall it.
iMSIflED
535
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1 Q But you'd never heard from Kimcha's own mouth
2 what his view of Ghorbanifar was?
3 A No, sir. I had never met Mr. Kimche.
4 Q So you are hearing this from other folks who
5 were relaying what Kimche had said, correct?
6 A That is correct.
7 Q And then you also have the paper record, that
8 Ghorbanifar has earned a burn notice. That's a rather
9 unusual document, is it not?
10 A Well, we have burn notices on fabricators from
11 time to time. There are a lot of fabricators out there,
12 sir.
13 Q Even that being the case, not all fabricators
14 have the good or bad fortune to warrant a fabricator
15 notice, though, right?
16 A That's correct. If the person becomes a
17 nuisance and begins to appear in a lot of embassies or
18 trying to make contacts with a lot of services, yeah,
19 it's helpful sometimes to put out a burn notice.
20 Q What is your understanding of why that kind of
21 thing happens? It's not simply because somebody had lied
22 to the Agency, I take it.
23 A Well, it's my sense that this occurs when we
24 have sources who have come in. We would only put out
25 information on a source who has come to us and that we
536
UNeUSSIflED
301
1 have, evaluated, maybe utilized, and then found that the
2 man was lying and totally deceptive, or not totally
3 deceptive but deceptive on some fairly major elements of
4 what he was telling us.
5 Q When the Agency puts out such a notice on a
6 source, is it more often than not because the source
7 tried to hustle the Agency for money or some advantage?
8 A I can't generalize, but there are a variety of
9 reasons why people fabricate information. When they
10 become a nuisance, it's useful to make that information
11 available to consular officers or to embassies and posts
12 around the world so when this chap again knocks on yoOr
13 door you have his name there in some file and you
14 immediately know to turn him off rather than to start
15 writing cables and saying this guy has sensational
16 information.
17 Q It's the kind of once-burned, twice-shy rule
18 at work here?
19 A That's right. It doesn't mean that it's an
20 infallible system by any means.
21 Q Thank you. I promise you we will go into 1986
22 when we return from lunch.
23 (Whereupon, at 12:10 p.m. the taking of the
24 instant deposition recessed, to reconvene at 1:15 p.m.,
25 the same day. )
IINetASSiFIED
537
wei^^rB
302
1 AFTERNOON SESSION
2 (1:19 p.m.)
3 Whereupon,
4 CHARLES E. ALLEN,
5 the witness herein, having been previously duly sworn by
6 the Notary Public, was further examined and testified as
7 follows:
8 EXAMINATION ON BEHALF OF THE SENATE SELECT COMMITTEE -
9 Resumed
10 BY MR. KERR:
11 Q Mr. Allen, we had one question basically based
12 on reactions. You had told us you were not aware of the
13 cargo of the proprietary flight into Tehran but that you
14 suspected it was something other than oil-drilling
15 equipment. You were aware, if I am remembering
16 correctly, that Mr. McMahon, by his expression, went
17 through the overhead and was upset on the 2 5th of
18 November; correct?
19 A That's what he said.
20 Q And then you had become aware on the 4th of
21 December from your conversation with Mr. Ledeen that the
22 cargo of the flight was in fact HAWK missiles; is that
23 right?
24 A Yes, sir.
25 Q When you had that brought to your attention on
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th« 4th of December, can you describe your reaction to
it? Was it information you felt ought to be placed
immediately in the hands of Mr. McMahon, for example, who
apparently was concerned about those sorts of things?
A I didn't think about it at the time. As you
recall, I testified that on the 26th of November at 0200
hours!
ind anyone^^^^^^^^^Bwould surmise that that's
not oil-drilling equipment. That had to be weapons
systems.
So it was no secret among the people at the
Agency and recipients^H|^^^^^^^^^^|and those
that followed that the aircraft on the 24th-25th must
have carried arms.
Q It's certainly no secret to you as to what Mr.
McMahon would have known and when he would have known it.
To what extent did you convey to him what you knew about
the cargo of that flight?
A I don't recall. I don't recall.
Q You do not then have a recollection of
perceiving this information to be particularly
troublesome, a source of significant concern that you
would want to raise with higher levels in the Agency,
wrnmm
539
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304
1 nothing of that kind in December after you learned of the
2 information Mr. Ledeen had on the cargoes; is that right?
3 A I don't recall thinking about it as
4 significantly new information because based on the
5 intelligence we were receiving that was available to Mr.
6 McMahon and Mr. Casey, the White House, either directly
7 or indirectly, was involved in ensuring that arms and
8 weapons were being shipped into Iran in small quantities,
9 but nevertheless they were going there with the explicit
10 purpose of attempting to secure release of American
11 hostages in Lebanon.
12 Q How conscious were you in the period November
13 24 through the end of December of McMahon 's apparently
14 fairly strong concern that the Agency needed a Finding to
15 provide the legal foundation for doing what it had done?
16 A 24 to 30 December?
17 Q Starting November 24, running to the end of
18 the year, during that time.
19 A I was quite aware that he felt very strongly.
20 Mr. Clarridge had expressed that to me on the 26th of
21 November, that Mr. McMahon had referred the matter to the
22 Office of General Counsel and that a Finding might be
2 3 necessary. Mr. McMahon reiterated that to me in no
24 uncertain terms on the 16th of December, and he indicated
2 5 that to proceed a Finding was a fundamental necessity for
uNCUtsstre
540
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305
1 th« Agency.
2 So from my perspective the Deputy Director of
3 Central Intelligence was up front on the issue of a
4 Presidential Finding.
5 Q In terms of a Presidential Finding, did you
6 have an understanding or knowledge of who in the Agency
7 was responsible for obtaining a Finding?
8 A It was my understanding that the matter had
9 been referred to the General Counsel. The General
10 Counsel was involved in the process.
11 Q So it was your impression that it was under
12 the aegis of OGC; is that right?
13 A That's correct.
14 Q The Finding process in terms of the paper kind
15 of breaks down into the proposed Finding of November 26.
16 There is the reference in McMahon's notes of him thinking
17 the Finding was signed on December 5. We talked about
18 the Christmas Eve 1985 conversation which lee
19 to think that a Finding had been signed.
20 At no point, though, in December 1985 did
21 anyone actually tell you that a Finding had been signed
22 by the President; is that right?
23 A I don't think so, other than the comment made
24 by Colonel North in his office on the 24th of December.
25 Q So you actually didn't see a Finding, signed
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uHi^Msn
306
1 or unsigned?
2 A I did not see a Finding either in a draft or a
3 signed Finding.
4 Q Moving into January, again from the documents
5 there appears to have been a series of drafts and
6 ruminations by lawyers in the period January 1 through
7 the time the Finding actually gets signed on January 17,
8 Did you have any role at all in that evolutionary process
9 leading up to the January 17 Finding?
10 A No, sir. I knew that Judge Sporkin had met
11 with Colonel North on the development of the Finding. I
12 remember Judge Sporkin calling me after talking with *
13 Colonel North at one point around the 3rd of January,
14 1986, where Judge Sporkin stated that he had discussed
15 the Finding with Colonel North. He did not say he had
16 discussed it with anyone else at the White House. He was
17 talking on a non-secure telephone, and he said the
18 Finding troubled him. It was a difficult Finding to
19 prepare.
20 Q It troubled Sporkin?
21 A Yes, sir.
22 Q I take it because of the phone situation he
23 was not able to elaborate on that?
24 A No, sir, he was not able to elaborate.
25 Q Did you have an occasion in that time period
UNtnSStFIED
542
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307
1 when you talked in greater detail with now-Judge Sporkin
2 about this matter?
3 A I don't recall in the January time frame
4 talking about it in any detail at all. I probably saw
5 the Judge during that time frame, but I don't recall
6 sitting down and discussing it with him.
7 Q Let me shift gears again. Let's go to the
8 Ghorbanifar polygraph session. You became aware that
9 Ghorbanifar was going to come back to the United States
10 in January when?
11 A I don't recall, but probably Mr. Ledeen told
12 me he was coming back, but I don't recall the date. When
13 Mr. Ledeen asked me to meet him on the 12th of January
14 clearly I knew Mr. Ghorbanifar was there.
15 Q I understand. Let me come at it another way.
16 Do you recall conversations with Ledeen in which he said,
17 well, we thought he was coming out on the 6th but it got
18 postponed?
19 A No, sir.
20 Q Was Ledeen keeping you apprised during the
21 period between December 4, when you met with Ledeen, and
22 January 12 on what he knew Ghorbanifar was up to?
23 A No, sir. I didn't know anything in detail
24 about that.
25 Q And in terms of the folks from the Operations
UNimsm
543
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308
1 Directorate, as I understood your testimony before lunch
2 you didn't see the reports on their meeting with
3 Ghorbanifar?
4 A No, sir, I did not see them.
5 Q And am I also correct that you did not discuss
then with Hjj^^^^^^^^^^^^H^Hwhat come
7 their meeting with Ghorbanifar?
8 A On the 20th, on the 21st of December, no, not
9 that I recall. I can't recall.
10 Q Had Director Casey given you any direction or
11 heads-up or anything that you might end up tending to Mr.
12 Ghorbanifar in December of 1985?
13 A Absolutely not. I would have been surprised
14 had he asked me to do so, given my other heavy
15 responsibilities.
16 Q Had you had a conversation with Casey or
17 McMahon — let me strike that. Had you had any
18 conversation with Mr. Casey on what his intentions or
19 hopes with regard to Mr. Ghorbanifar were in December of
20 1985?
21 A I don't recall. I don't think so. I do not
22 think so. I do not recall a conversation.
23 Q Ghorbanifar was in town on the 11th of
24 January. He met with^^^^Hfor lunch and then they went
25 and had the polygraph test taken. You knew he was in
mmm
544
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309
1 town on the 11th, l assume. Is that right?
2 A Yes, I think I knew that he was here on that
3 weekend.
4 Q In terms of the meeting on the 12th, do you
5 recall talking to Ledeen the preceding evening, the
6 evening of the 11th?
7 A No, sir.
8 Q Do you recall knowing on that weekend, the
9 weekend of the 11th and 12th, that Mr. Ghorbanifar was
10 complaining about bruises and the like as a result?
11 A He told me that on the 12th, showed a bruise
12 on his arm.
13 Q But you would not have met with him on the
14 11th?
15 A No, sir. I never met him on the 11th. That's
16 a Saturday, and I clean house on Saturdays.
17 Q When you met with Mr. Ghorbanifar and Mr.
18 Ledeen on the 12th, it was at Mr. Ledeen 's home?
19 A Yes.
20 Q Can you give me your best recollection of what
21 transpired at that meeting on the 12th?
22 A It was mostly just a social meeting. I was
23 only there for a brief period, an hour, hour and a half.
24 The Redskins were playing and Mr. Ghorbanifar was
25 complaining about that in fact he had taken a polygraph
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545
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310
1 and he was having after-effects, in his view, from the
2 polygraph.
3 Q Did he request or did you offer to get a
4 doctor to assist him on the 12th?
5 A Absolutely not.
6 Q And you did not make arrangements for a CIA
7 doctor to treat Mr. Ghorbanifar on the 12th?
8 A No, sir.
9 Q From what you could tell, did he appear to be
10 badly injured or ill on the 12th?
11 A No. Mr. Ledeen was planning to arrange a
12 medical doctor to examine him, as I recall.
13 Q What was Mr. Ghorbanifar' s attitude vis-a-vis
14 the test?
15 A He was rather negative toward it, but I didn't
16 )cnow the results of the test at that time.
17 Q Has he suggesting to you that he had been
18 mistreated, mishandled? Was that part of his chatter on
19 the 12th?
20 A The general comments he made were the it was a
21 rather painful experience for him and it went on for five
22 hours or something along those lines. And it was very
23 uncomfortable for him.
24 Q At that meeting he was or was not aware of the
25 results of the test?
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1 A To the best of my knowledge, I don't think
2 anyone talked about the results of the test. I wasn't
3 aware of it and had no knowledge of it.
4 Q Had Mr. Casey as of that time asked you to be
5 in touch with Mr. Ghorbanifar?
6 A No, I don't think so. I think Mr. Ledeen
7 suggested I stop by and meet him socially that afternoon.
8 Q So this meeting really was at Ledeen's
9 initiative?
10 A Um-hum.
11 Q I assume because he had told you about
12 Ghorbanifar and it was a chance for you to see him live.
13 A Um-hum.
14 Q Did you tell North or anyone else that you
15 were going to have this meeting with Ghorbanifar on the
16 12th?
17 A I don't recall. Certainly it wasn't a secret.
18 Q You did not make any record of this meeting
19 onthe 12th?
20 A No matters of substance were discussed that I
21 recall.
22 Q Now the following day, on the 13th of January,
23 the folks in the Operations Directorate met and made
24 known their views on Mr. Ghorbanifar. Were you aware
25 that they were meeting to discuss Mr. Ghorbanifar?
VNCDCTED
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UNCIAS^IED
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1 A No, sir.
2 Q Were you aware on the 13th of what they had
3 passed on as their position and perspective to Director
4 Casey?
5 . A Mr. Casey stated that there had been a meeting
6 with DO officers with him, or with — I believe with him
7 — and that the results of this polygraph were very
8 negative. Mr. Casey stated on the secure telephone that
9 he would like me to go out and meet with Mr. Ghorbanifar
10 to determine and make a record of all the information
11 that he possessed on terrorism, especially that relating
12 to Iranian terrorism — just take another look at thia-
13 individual, which I proceeded to do.
14 Q Were you aware at that time that Ghorbanifar
15 had been asked a series of rather specific questions on
16 his Icnowledge of terrorism in the polygraph test?
17 A I did not see the polygraph questions in
18 advance. Mr. Casey may have shown them to m^TT I think
19 I also went down to see him. I can't say specifically.
20 I think I talked on the telephone. I saw the questions
21 at some point, but I'm not certain it was that day.
22 Q Do you think you saw them before you actually
23 met with Ghorbanifar?
24 A I don't know. It's been so long ago.
25 Q When Casey gave you this assignment was
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anybody else present either on the phone, to your
knowledge, or in his office?
A Well, sir, if they were on the secure phone
listening in, that was not appropriate.
Q All right. It's not a party line operation.
A No, sir.
Q In the meeting with Mr. Casey was anyone else
present for that?
A No, sir.
-' fa ■ -^ ' ' j^*~ jr."'
Q ^ Wh«h yoit-iwt wfth 8f . Ca»ax;^m"1Bi€t5l3th did he
^^■^'-^
tell you during: th»-cocrtTS«5i3f ''BBlt; B««tln^»r any-.^aK«r
me«tln<^^U. had with hisnoA^^^^^^^ Uie mttiULlS^ th«..
Iraniin initiatiifEt—^ _ ^.=J^ . f^^ i* „ - "-":* ^^ _
- A No, sir. " I 'dontt^.ttiink hi, to the baat.of jgg
recollection, tallceif^fn any aftt»i\^^pu^ith^ygwlao
Ghorh^g^r Wt tStr^^fiii Wd vImJH any^|Cussion&~at
all with th« Op«rati<^ns p«&pl^mo hid (Cptductad-^iBfr
polygraph tjtit?
A ^No.
Q "^^=^1^Srytm^are not t^tJtin wl^^r cr^not jjgu-s;^
reviewed tha ta*t (^i<|j|^^^r any^sf -thajMsera
weeg generated 'by th*-t»lfti i^Uiat_rigbtfe;-^ ^
A In advaac<gj, f don* t reca^ll .1 read th»
mi
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1 questions at som|^»|}oint and I gues« wh«r« th« OB«rator
2 felt deception Sad occurred. ^ —
3 Q Let me show~you a Isemorandu* for the record on
4 the Ghorlsanifar polygrapii exam v^ich will be Exhibit 23.
5 --^ ^^ (TRe document referred to was
6 marked Allen Exhibit Kumber 23
7 for identification.)
8 And a memorandum by the polygraph operator on
9 the examination, which will be Exhibit 24.
10 (The document referred to was
11 marked Allen Exhibit Number 24
12 for identification.) -
13 I'd like you to look at both of those and ask
14 you to please tell me whether or not they are documents
15 you -would have seen on or about, in the vicinity of the
16 date.
17 MS. MC GINN: May I interrupt? I think I am
18 missing Exhibit 22.
19 MR. KERR: Exhibit 22 is a cable.
2 0 (Pause.)
21 THE WITNESS: I have seen — let me let you
22 ask the questions.
2 3 BY MR. KERR: (Resuming)
24 Q As to Exhibit 23, first have you ever seen
25 that memorandum?
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1 A I've seen, I think, the attachment.
2 Q The attachment?
3 A Um-hum.
4 Q The MFR itself?
5 A I don't recall the cover MFR.
6 Q And as to Exhibit 24, do you recall having
7 seen that memorandum at any time?
8 A I don't think I've seen — I've seen the
9 questions that were asked, but I don't think I've seen it
10 in this form. Maybe I'm thinking of the attachment. And
11 I can't recall the date that I saw it. It certainly — I
12 did not see them before I went to see Mr. Ghorbanifar en
13 the 13th.
14 Q The MFR does say that neither Ghorbanifar nor
15 Ledeen had been advised about the results of the test.
16 At the time that you met with Ghorbanifar on the 13th,
17 was he knowledgeable about the test? 9m he know how he'd
18 done on the test?
19 A I don't recall.
20 Q Do you recall telling him how the test had
21 gone?
22 A No, sir, I don't think I made any comment on
23 it.
24 Q Do you recall there ever coming a time when
25 you discussed either with Mr. Ghorbanifar or Mr. Ledeen
ONcotssro
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UNCUSSIID
316
1 how Mr. Ghorbanifar had done on th« t«at on January 11?
2 A I don't recall that. It's my understanding
3 that Mr. Ledeen had knowledge he had failed the polygraph
4 test.
5 Q That likewise is mine. I'm wondering if you
6 have any idea what the source of that knowledge.
7 A I don't want to speculate. He clearly had
8 knowledge that Mr. Ghorbanifar had failed, that he had
9 failed 14 out of 15 questions or sosttthlng of that
10 nature.
11 Q Is it your recollection that he had that
12 knowledge on the 13th when you went over to Ledeen 's '
13 house or was it some other time that he had that
14 knowledge?
15 A I don't know when he obtained that knowledge.
16 I don't recall.
17 Q To put it more precisely, you don't recall
18 when you acquired that knowledge of what Ledeen knew?
19 A I don't recall when. Certainly^ by th« tlma. I
20 8a%i>3lr. Ghorbanipar — and it was on the 26h of January -
21 - Mr. Ledeen and our friend -«r. Ghorbanifar knew too —
22 put "our friend" in quotation marks.
23 Q Business acquaintance or some such thing?
24 A No, sir.
25 Q Not even that?
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1 A I want to go on record and say absolutely no
2 business acquaintance whatsoever.
3 Q Let 3ne come back to what you know about what
4 Casey knew about the Iranian initiative. I want to show
5 you a memorandum that's dated January 13, 1986, that
6 seems to have been prepared for or perhaps even by
7 Director Casey. I'd like you to look at the memo, tell
8 me it you've ever seen itJuttozm, andr^g. y<apfaVil wa'll
9 explore ' ti jj i|i Tr jiMii li i 'jjuji't iiu jH^TlliV Jjyyul ^^Wiii ii at.
10 it for the^«ubstl|Ber-aosi th«n"«»gnr3oing to see what 'you
11 knew about the matters that are discussed in this memo of
12 January 13, 1986. That will be Exhibit 25.
13 (The document referred to was
14 __ „ _ atai,^ - marked Allen Exhibit Number 25
15 for identification.)
16 (Pause.)
17 A I have not seen the memo previously.
18 Q Can you tell from looking at the memorandum
19 who the author of the memo was?
20 A Well, I assume it was written by the DCI since
21 it has his initials or at least the letters of DCI in the
22 upper righthand corner.
2 3 Q That's a question I have. I have no idea what
24 the format would be for this kind of a memo. Would that
25 in the custom and business of the Director's office
UlflMIFIED
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indicate this was probably his memo?
A I can't make that judgment. All I see is DCI,
13 December 1986 and I must assume that that is his memo.
Q Were you familiar with the events and
circumstances that are set forth in that document as of
January 13?
A No, sir, I was not aware as of January 13 on
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first paragraphs, at
that stage I had no knowledge.
Q Let's shift ^ars again. I'd like you to take
a look at your January 29, 1986 memorandum describing
your meeting with Ghorbanifar on January 13, which will
be Exhibit 26.
(The document referred to was
marked Allen Exhibit Number -2 6
for identification.)
Could you look at that document and tell me if
that is in fact your memorandum of the meeting with Mr.
Ghorbanifar?
A Yes.
Q With regard to the meeting that you had on the
13th of January, did you record that meeting in any
fashion other than by making notes? Did you record it
electronically?
A Mr. Ledeen provided a tape recorder, but I
don't know. No, I don't think it ever worked. I don't
ever recall getting a tape.
Q You did make handwritten notes, I take it, as
ONCtASSm
555
lINMSIflED
320
1 you went through the course of the afternoon with Mr.
2 Ghorbanifar?
3 A Yes.
4 Q Now the memorandum, I would assume, is a good
5 . and relatively accurate, as best as you could do it,
6 summary of the conversation that you had with Mr.
7 Ghorbanifar.
8 A It is a detailed record of what I thought was
9 principally important, because the Director asked me to
10 obtain information on terrorist networks which Mr.
11 Ghorbanifar claimed to possess.
12 Q The memo indicates, and I would asstune it was
13 the case, that Ghorbanifar ranged a bit further than
14 terrorist networks in the course of his five-hour
15 conversation with you and touched on things other than
16 simply terrorist networks. Am I correct? Among other
17 things, he griped about the Agency a little bit in the
18 beginning.
19 A Yes, and I recorded that. I thought I should.
20 He also talked about, I believe, the cost of the missiles
21 that were sent in the November shipment, that in fact
22 they were the wrong missiles and that the price was four
23 times an appropriate price, somewhere in here.
24 Q It's in there. It's in the first page or so.
25 With regard to the pricing and the missile aspect of
UNcmFe
556
ilNKA$SIFIED
321
1 things, did he elaborate on that point with you at all?
2 Did he tell you what he thought had become of the money,
3 whether there had been a misappropriation, if you will,
4 or diversion of funds on this particular transaction?
5 A No. That is about all he said. It struck me
6 as of interest because it reinforced what had actually
7 occurred in the November 24-25 dispute in Geneva,
8 something I didn't quite understand, and I recorded it
9 because that convocation ended on such a very bad note.
10 He said the Prime Minister and others believed they were
11 cheated. I thought that was a significant thing to
12 record. -"^'■~"' ^^S^" _«
13 Q When you're making reference to a November 24-
14 25 convocation, what are you referring to?
15 A I'm talking about the meeting between
16 individuals including^^^^^^^^f^Band Ghorbanifar and
17 unknown other individuals who were in Geneva, as I've
18 testified earlier on the 24th-25th.
19 Q You are talking about!
^^^^^^^^^^^^H is
21 A Well, yes, ^^^^H|colonel North saying there
22 was an important meeting occurring in Geneva.
23 Q On that November trip — and I promise not to
24 go back into '85 too many more times — do you know
25 whether or not Colonel North had any kind of recording
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device he toolc with him on that trip?
A As you recall, on the 24-25 meeting in Geneva
Colonel North was in Washington.
Q I had lost that. You are right. In terms of
what happened at that meeting, let me come at it another
way so I understand what you are telling me, Mr. Allen.
Your knowledge of what occurred at that meeting was based
on what resources
[Colonel North's '
reaction at 0200 hours on the 26th of November where he
said that the talks had broken down. He was bitterly .
disappointed. On the 22nd, when he had called and asked
f or^^^^^^^^^^^^^^^H he was sanguine.
Q Let's come back to the 13th. During the
course of your conversations that you had with Mr.
Ghorbanifar on the 13th of January thera is an itan that
Mr. Ghorbanifar raised with you that is not in your
notes. You recollect, do you not, that Mr. Ghorbanifar
made apparently explicit reference to engaging in
transactions which would generate money for the
assistance of the Nicaraguan centres?
A I recall after I went through my notes, which
were retained, from that meeting in November or December
'86 that there was a reference there to that fact. I at
UNWSIflfD
558
}immm
323
1 th« tima did not consider it important or even relevant
2 to my particular mission as given to me by the Director,
3 so it was simply a comment I did not find incredible or
4 of interest since I did not record it in this memorandum
5 of 29 January.
6 I did not find it relevant; ergo, I did not
7 put it in the memorandum. It seemed far-fetched and
8 nonessential.
9 Q Let me show you a letter of 24 February 1987
10 to Mr. Liman from Mr. Rizzo which has attached to it a
11 series of tabs, and with regard to the meeting on the
12 13th the tab or attachment that is referenced as
13 Attachment A, I'd like to have the letter marked Exhibit
14 27.
15 (The document referred to was
16 marked Allen Exhibit Number 27
17 for identification.)
18 What I'd like you to do is take a moment to
19 refresh your recollection of what your notes contained
20 both on this and perhaps the other meetings as well, and
21 then I want to come back and see, first, if they are your
22 notes and then if you have any further recall of the
23 events that are referenced.
24 (Pause.)
2 5 A Okay. May I comment on these individually, if
vmmm
559
)immm
324
1 that Is appropriate?
2 Q Sur*.
3 A As you know, this first on*, Attachasnt A, as
4 I racall, ar* notes from ths 13 January 1986 Basting with
5 Ghorbanifar, and w* went through what h« knsv about
6 Iranian terrorism, I bslisvs Syrian terrorism, and then
7 he claimed ^^^^^^H^^connections to Libya. He said he
8 thought his Syrian relationships were the best and he
9 said, you know — and Z don't know exactly what he said -
10 - we can thwart some of these terrorist activities. We
11 could fund the contras, I assume. But I don't know vhat
12 he said. It was all in three words. ''
13 And we're off on many more of his rather
14 grandiose plans.
15 Q Let me stop you. In terms of what he was
16 saying about funding the contras or how to fund or
17 whether to fund or what to fund, you can't elaborate any
18 more?
19 A I'm sure he didn't say anything more than
20 what's probably recorded here, probably in one phrase.
21 Q Let me keep you on January 13 for the moment.
22 Frankly that strikes me as a strange phrase. You didn't
23 see that as something you wanted to explore further with
24 him?
25 A Absolutely not.
UNtbtSSIFIED
560
UNGlASmiED
325
1 Q Why not?
2 A Because I am interested in credible plots by
3 terrorist groups or states that sponsor terrorism, and
4 that didn't even begin to touch my consciousness as an
5 issue worthy of exploration.
6 Q Well, let me explore it. He was essentially
7 trying to interest the Central Intelligence Agency in
8 joint venturing with him on some project?
9 A And I reported that early on. He's a turnkey
10 man and he gave a number of illustrations where he could
11 be of great help to the United States for appropriate
12 compensation. *'
13 Q And he was looking for a benefit to be gained
14 for himself from the joint venture operations he was
15 proposing, correct?
16 A That's right, and I tried to convey that
17 thought in paragraph 2 .
18 Q I think you do. It comes clear from that and
19 that's why I want to pursue a bit more. You had the
20 feeling on the 13th, didn't you, that to some extent you
21 were listening to a sale pitch by a fellow who wanted to
22 become a contractor to the CIA?
23 A Absolutely. I think that comes clear in the
24 memo. The man has a lot of grandiose ideas.
25 Q I understand that. In terms of the pitch that
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he was making, were you left with the impression that he
thought he would be more attractive to the Central
Intelligence Agency if he offered to share part of the
take in such a way that it benefitted the contras in
Nicaragua?
A It didn't occur to me at the time that it was
any more significant than anything else he was saying as
part of his overall sales pitch which, of course, went on
for five hours. He spoke about his excellent contacts.
Q As of that time, Mr. Allenf you werft or v^e*
not ftWari^iir contributions for the contra cause by folks
in ^H^^^^^^^H^Hj^B
A fhatc;vafc;gafeary 1986? I had n^lBcplicit ~'
knowledge of that. I tgJrUc there had beenirumor^tp that
effect^.
Q As ^HHiB^JtaittBlfei^Bry 1986 , wei^you^^««yi
Of ■ iiiiitiiyn|ftiii"'"
Khashoggi?
A At that stage I don't think I knew that
Ghorbanifar had a relationship with Khashoggi.
Q Let me come at something that's not there at
all, and I'm not sure whether it happened. Were you
aware at this time of a relationship between Ghorbanifar
and Roy Furmark?
A 1 don't think I had heard of Roy Furmark at
UNtnSStFlEO
562
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327
1 that stags.
2 Q Or John Shaheen, for that matter?
3 A And I don't believe the Director had talked
4 about John Shaheen. He talked about John Shaheen, I
5 think, about the time the McFarlane trip was occurring,
6 or thereafter.
7 Q The McFarlane trip in May of '86?
8 A Yeah, and I don't know.
9 Q Nothing struck you about the reference to the
10 contras that suggested that there was a thought on
11 Ghorbanifar's part that this would be plsa«ing to your
12 ears or the ears of Oliver North or anyone else?
13 A Well, if I did, I would have recorded it and
14 put it in the memorandum, because I gave a copy of this
15 memorandum to Colonel North and it would have been in the
16 memorandum.
17 Q Hell, that raises the natural next question.
18 Did you discuss this point with Colonel North even if it
19 wasn't in the memo?
20 A No, sir. I didn't think anything about it and
21 promptly forgot about it.
22 Q You met the next day, January 14, with
23 Director Casey, I believe, from what you told us in your
24 interview, to discuss what you had learned from Mr.
25 Ghorbanifar; isn't that correct?
UNttASStHED
563
imssiwD
1 A Yes.
2 Q Did you at the meeting with Director Casey
3 refer to your notes and tell him that there had been this
4 suggestion of potential benefit for the contras as part
5 of the Ghorbanifar sales pitch?
6 A No, sir.
7 Q So you do not recall in January addressing
8 that point to Casey at all?
9 A No, sir. It did not enter my consciousness as
10 a significant point.
11 Q Were you aware in January of '86 of Colonel
12 North's involvement in contra matters?
13 A Well, I certainly was in the sense that there
14 was considerable press publicity in August of 1985 where
15 he and his family were harrassed, where there was
16 considerable publicity in a number of newspapers,
17 including the Washington Post and the New York Times, and
18 I was attending interagency meetings at the White House
19 with Colonel North at that time and he had some real
20 harrassment by people who opposed the American
21 Administration's policy in Central America.
22 Q I would have thought, particularly given that
23 kind of environment, it would have led to, if nothing
24 else, casual conversations between you and Colonel North
25 about what he was doing in Central America.
[d|
564
w&mm
329
1 A I would re j set that b«cau«« I juat don't think
2 that that va^^islgnrf leant statenant. It was on*
3 phrasA^^ K« dldn ' t go into «n^«laborata axpla^l^ioh of
4 What h« meant^ Mr. GhorbaniSB' spudn with graat
5 rapldity^. HlsEnglish is garbled at times, and trying to
6 cope with all this outflowing of information on his
7 alleged knowledge of terrorism more than kept me busy. for
8 those five hours.
9 I didn't ask for the assignment. The Director
10 sent me on the assignment. So the fact I didn't record
11 this did not to me seem significant, and I. certainly
12 didn't even recall it after that January meeting.
13 Q Bear with me. At the time of your meeting
14 with Ghorbanifar on the 13th were you aware, directly or
15 indirectly, of Colonel North playing a role in raising
16 money to assist the contras?
17 A I was aware there had been statements to that
18 effect, that he was involved in at least encouraging
19 private donations to the contras.
20 Q Apart from whatever you saw in the newspapers,
21 had he himself indicated such things to you?
22 A I don't think he had spoken. We never
23 discussed Central America and the contras, except in the
24 most generic ways. I recall when we were in OSD in the
25 summer of 1984 we needed Colonel North's assistance on
ONCnSSIFIED
565
IMASSIIIED
330
1 the project, the very sensitive project I was on in the
2 summer time frame, and he was unavailable and he later
3 told me in some time frame that he was traveling at the
4 direction of Mr. McFarlane and it was related to the fact
5 that funding had been cut off for Central America and he
6 was traveling various places in the world to try to have
7 donations made, private donations made, to people
8 interested in continuing the anti-communist effort in
9 Central America.
10 But I don't have a time frame for that
11 converation.
12 Q During the course of your conversation with*
13 Mr. Ghorbanifar was Mr. Ledeen present throughout?
14 A No. He walked out and stayed in the other
15 room.
16 Q So it's more likely than not that he was not
17 present when this statement was made; is that correct?
18 A I would say that he was not present.
19 Q If I can borrow that back for just a second,
20 Tab B, I take it, at least from Mr. Rizzo's letter, is
21 likewise a portion of your notes from the January 13
22 meeting, and Mr. Rizzo's letter, which I assume was
23 written after talking with you, indicates —
24 A I want to correct the record. Mr. Rizzo wrote
25 the letter and it showed up on my desk. I did not see it
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331
in advanca.
Q If you would look at Tab B in conjunction with
Tab A and tell me if there is a relationship between the
$100 million proposal that's referenced on Tab B and the
funding of the contras, which is on Tab A, I would be
grateful. Mr. Rizzo seems to think that there was.
A Well, I can't conjecture what Mr. Rizzo
thinks. I don't know that there's a relationship
whatsoever. I recall that Mr. Ghorbanifar talked about
he was aware of ^^^^^^^^^^^^^^^^^^^^|
that he wanted the help of the United
}cnow, clearly he wanted sob* of the money
for himself, but he thought that the other money could be
used for some form of action. I was simply recording
what this man was stating, and I don't see any relevance
necessarily to what occurred in Attachment A.
Q But for Mr. Rizzo' s suggestion, I might not
either.
A Well, I'm not here to suggest what Mr. Rizzo
wmsm
567
iiciAssife
332
1 thought. I didn't tell Mr. Rizzo that.
2 Q Mr. Allen, my guess is that you must have had
3 a discussion with somebody about these two sets of notes.
4 Did you talk to the IG? Did you talk to somebody else in
5 Mr. Rizzo's office?
6 A The Inspector General went over all my
7 documents and asked me questions, but I don't know that I
8 connected the two in discussions with the IG. I
9 certainly don't connect them now.
10 Q Let me make a suggestion to try to connect
11 them up for you. There are a series of conversations on
12 this point, which we're going to go through, '"alnP^t *
13 appearis that one of Mr. Ghorbanifar's suggestions was
14 that the $100 million could be split in various ways, one
15 of the ways being to provide a substantial contribution
16 to Colonel North's efforts in Nicaragua.
17 A Well, if you will go on to whatever,
18 Attachment D, I believe that came from my notes in
19 London. I wrote that down and again when I came to that
20 in writing up the record that seemed so preposterous I
21 don't think that I wrote anything specifically on this.
22 It's so farfetched and again, you know, it was one of
23 many notes. So I didn't put it in the memorandum for the
24 record.
25 Q I think all of us now know Mr. Ghorbanifar to
UNttJSSinED
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333
1 be a fairly persistent fellow. What I am suggesting to
2 you is wouldn't it be correct that on January 13 he
3 formulated to you for the first time this proposal that
4 there would be $100 million deal that ho could do and
5 that some portion of that $100 million could be used to
6 fund the contras?
7 A He made that statement, but he didn't offer —
8
9 Q I just want to make sure he made that
10 statement at that time.
11 A I recorded that he said something about we
12 could get $100 million, and I don't recall $100 million
13 in relation to the contras in the conversation on 13
14 January. I recall some very farfetched statement he made
15 on the 2 6th of January that was so extreme that no
16 rational man, in my point of view, could take it
17 seriously in any way.
18 Q That raises another question I have that I'll
19 throw out right now. We'll come to the 26th in more
20 detail in a bit.
21 But if Mr. Ghorbanifar is coming up with
22 farfetched and preposterous schemes on points like this
23 which you dismiss, why do you take him seriously on other
24 schemes like freeing hostages?
25 A Well, actually it turned out that on|
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25
>o what Mr. Ghorbanifar told me had some
substance to it. So in retrospect it was not all
bravado.
Q I'm perfectly prepared to believe that he was
prepared to come up with $100 million and help Ollie
North out. I suspect that that was maybe very sincere.
What I want to know is what caused you to think he was
credible in certain areas like releasing hostages and -not
in others, like $100 million to go to the contras?
A Why don't you tell me why I said he was
credible in releasing the hostages? I didn't quite make
that judgment in this memorandum.
Q That's helpful. You do not feel as of January
13 that he was credible in terms of being able to be
helpful to release the hostages; is that right?
A I did not have enough Scnowledge of the release
of Benjamin Weir. I did not have enough knowledge of all
of the activity under way by Colonel North, as you know,
as we went through this morning, the compartmented
nature, and I know that other people have told you about
how compartmented we operate, that I simply at that stage
mmmn
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1 was trying to record, on the 13th of January, everything
2 he could tell me about terrorism
3 And he told me a good deal, and he said he had
4 more to tell me, but I wrote all I could up and sent this
5 widely throughout the DO, to the Director, to the Deputy
6 Director, to everyone so not just I but others could make
7 judgments on the matter.
8 Q It's the judgment that I am trying to come to
9 grips with. He had just failed rather strikingly a
10 polygraph test. He had an established track record of
11 being someone whose word could not be relied upon in the
12 Agency. You are now having a meeting with him on the*
13 13th where he's telling you things which you perceive to
14 be preposterous.
15 A Some aspects. I did not say that all was
16 preposterous. I said some of it seemed very, very filled
17 with hyperbole. I think that it was important, if he
18 really knows all of this, I think my recommendation was
19 it's time for us to work our way through very, very
20 carefully and try to evaluate this.
21 Z said he is impatient if one tries to pin him
22 down on specifics of some of the complex plots that he
23 describes. I talked about a careful and direct approach
24 to try to nail down just what he really did know as
25 opposed to what he was manufacturing, was the essence of
IINCDI^SinED
571
336
1 my reconunendation.
2 Q So you felt as of January 13 that it was worth
3 continuing to try to work with him, correct?
4 A I was talking generally on the terrorist
5 aspects, because that's what the Dircector asked me to
6 do.
7 Q But even on that you felt that on the
e terrorist aspects it was worth a try to work —
9 A We have thousands of people out there
10 providing a lot of data which we report conscientiously,
11 soB« of wltich *Bi v<i3ry aurfetched on terrorism. For evert*
12 serious plot we may get a thousand threats or reports -of
13 threats, so it's a very difficult process. We're dealing
14 with very sleazy, unreliable people in the world of
15 terrorisir. Tr*- •'^"'JLiltiT** *"ljL1 '"^ discuss that aspect,
16 but let me assure you it's hard to find a good, reliable
17 source because you're dealing with people who deal in
18 duplicity, who commit political violence themselves.
19 MR. WOODCOCK: Let me just ask you one
20 question on this same topic. The portion of the
21 memorandum that you just quoted on your suggestion for
22 handling Ghorbanifar also goes on to say that for this
23 reason the best strategy is to go back over details in a
24 series of meetings so that all aspects of the plot can be
25 determined.
UNCbmtFHD
572
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1 That suggests a somewhat tlme-consvunlng
2 procedure. How precisely wfts it that you were
3 envisioning Ghorbanifar might be able to be used, given
4 that he required that kind of straining?
5 THE WITNESS: At that point I didn't really
6 think deeply about it. I just simply summarized it for
7 the Director and other people in the Directorate of
8 Operations. If we are really going to pursue this
9 individual's knowledge on terrorism, it's going to take a
10 lot of management of the source. This man has contacts.
11 He lives in a very fast lane. He has a lot of underworld
characters- he deals As you know,^^^^^^^^^^^^|
13 ^^^^^H^are some of the most insidious individuals in
14 the world, drug dealers, terrorists, gray arms merchants.
15 We really do have to deal with him almost day by day,
16 point by point. You can't let the man go off and try to
17 become a principal agent.
18 It was absolutely — that was the thrust of
19 what I was trying to say. It would take an immense
20 aaount of management. That's what I was talking about.
21 MR. WOODCOCK: Had you made a judgment at that
22 point as to whether he would be useful simply as a source
23 of Intelligence or whether he could at all be used In an
24 active operation?
25 THE WITNESS: I didn't reach that conclusion.
UNCtASSm
573
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338
1 What I was just trying to do was to canvass broadly what
2 he claimed to know.
3 MR. WOODCOCK: The reason I ask that is
4 because again of the procedure that you are suggesting
5 there. It would seem that in the course of an active
6 operation it would be very difficult on a minute-by-
7 minute basis to strain through his knowledge and then
8 take actions based on a judgment.
9 THE WITNESS: Yeah, and I don't know that I've
10 quite articulated it this way before. I think this
11 paragraph, this summary about the time and attention is
12 needed to keep a rein on Ghorbanifar, I think that was
a-'
13 what made mf uncomfortable about using him in the NSC
14 initiative, because he was on the go every day. He was
15 in one city after the other. He was constantly on the
16 move. Someone almost had to be at his side in order to
17 know what he's doing and to maintain control of any
18 operation, because, as we know, he lied to both sides all
19 the time during the NSC initiative.
20 MR. WOODCOCK: Thank you.
21 BY MR. KERR: (Resuming)
22 Q Let me just ask you one question about your
23 note. We've got two pages that have been identified to
24 us as being notes of the January 13 conversation. I
25 assume that there are more pages because these things
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1 sort of start and stop. Do you know at the present time
2 where a complete collection of your notes of the January
3 13 meeting might be?
4 A =2iJfes, sir. __^
5 Q Good. Where might they be?
6 A Well, I think the notebooks are being held as
7 part of the box on the part of the Independent Counsel.
8 I didn't throw them away. I don't know why I kept them.
9 Q Okay. Have you recently seen whether or not
10 there is a complete collection of your January 13 notes?
11 Did you happen to notice that?
12 A Yes. I turned thea in,.^.
13 Q So when they were last in your possession
14 there was a complete set?
15 -Jbff When last ijv-fogcjsQSsession there was a
16 complete set.
17 Q Unfortunately, they tiT'W'iffiili'ifenrniiher of
18 lawyers in them since tht:S^^iBa,. aoCl^tf knows the
19 condition they are in.
20 With regard to^te^-iS^ting with Director Casey
21 on the 14th, can you give me a synopsis of what you
22 talked to Casey about on the 14th?
23 A Yes. It was generally a summary of what I
24 later put in my memorandum, that he claimed to have all
25 this access. He showed me a few documents relating to
IINetA$«D
575
ONCtASSm
340
1 his access, you know, Ghorbanifar. I think he gave me —
2 I think he gave me a photograph or two — I can't recall
3 — of people he claimed had terrorist connections.
4 I said it was very hard to pin down the individual
5 in any concrete way. He is very flamboyant. He's very
6 clever, cunning. I described him as a con man to the
7 Director. I said it doesn't mean that, prop4H;faL,jaanaq>d»
8 and it might take a lot of effort, that you cannot manage
9 a con man to do this. And I remember the Director joking
10 and saying well, maybe this is a con man's con man then.
11 He used that phrase with me after I came back.
12 Q When you had this conversation with him, did
13 he give you any suggestion at all that he had former
14 clients or friends or business acquaintances who were
15 actually in business at that time with Ghorbanifar?
16 A No, sir.
18 A I don't recal^^mythfrfg'^^^^wcept the
19 Director said well, take a look at it, and he . -ged me to
20 write the memorandum, which I was very slow in getting
21 together.
22 Q Did he give you any instruction or direction
23 or assignment to be Ghorbanifar 's keeper at that point?
24 A No, sir, not at that point.
25 Q With regard to what happened next, on January
mmms
576
341
1 17, 1986, the Presidential Finding is signed, the one
2 that becomes operative, in any event. Were you aware of
3 the Finding being signed contemporaneous with its
4 signing?
5 A No, sir.
6 Q When did you find out about the Finding?
7 A I believe on the 24th or 23rd of January, when
8 I knew that some intelligence was being prepared for
9 eventual transmission to the Iranians. To my surprise I
10 was told by Bob Gates that he had ordered^H^^Hj^f'
^^^^^^^^^^^^^^^^^^Hthe Directorate Intelligence
12 to prepare a small sample of intelligence that contained
13 order of battle information on Iraqi dispositions on the
14 northern front, and he said you will be contacted bj
^^^^^^^^^^^^^^^^^^^^^^^^B and they provide
16 , you that intelligence, and I've ordered that it be
17 conpleted, I believe, by the 24th of January, 1986.
18 I don't }cnow why he did that, because that was
19 an unusual request. I think simply because he knew I had
20 been a focal point for the collection tasking and I
21 assume that so few people knew about this initiative, no
22 one )cnew the real story except Bob Gates at that time as
23 to what this was about within the entire Directorate of
24 ^^^Hpeople. -sss- - :-._i^„^--ifei
25 So he didn't have many people to turn to. So
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h* turned to me for that. So when the material was ready
the 24th^^^^H^^^|^|^^^|^^^|brought over to
me and explained what they were providing. In fact, I
think they had contacted me as early as the 2 3rd and had
showed me what they were planning to put on this
intelligence sample, and they wanted to know if that was
adequate.
And, as I recall, we made a few adjustments to
what was being prepared, but it seemed adequate at the
time. It was very bare bones.
Q Let me show you a document that I'd like you
to look at and tell me if you've ever seen it before. ♦If
you have, great; I ^'^^^xj^oea^utMl^^^ is- It's a
document that's headed Milestones and appears to have
been created about January 17, 1986, dealing with
essentially possible conse^guicM^jf the Finding. That
will be Exhibit 28.
(The document referred to was
:3i ^^cM«i_All«n IjKhiJ^t- Huaber 28
f or^iOjflb^lcati^e^
^fej^^ypcH^ at^^XM. to aggeuUt^^ Z1^|S««rs to
have 6riglnate*"at the tfflit« ffous«
'm^
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82-688 O-88-20
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343
1 Q Can you tell me how you reach that conclusion?
2 A Well, simply the :.scenarios and the
3 transactions~and the way they aire being- proposed, ^th«
4 fact that the Economy^Act — you know, I heard comments,
5 I gueaa, by Colonel North or others at this stage that
6 thdughts were being given on how to proceed, but I don't
7 recall seeing this specific document.
8 Q Would you ha_^ se«a one liki^t^ _^ _-
9 J^ I ««ii^*aoe^Bent which was briwght by Colonel
10 North on the 24th, I believe, of January 1986, which was
11 a schedule, and you are aware of that.
12 Q We'll touch on that in a minute. ^.
13 AX don't think I've seen this one.
14 MS. MC GINN: Could we take a break here for a
15 few minutes?
16 ■■ (A brief recess was taken.)
17 BY MR. KERR: (Resuming)
18 Q Mr. Allen, let me take you back to your
19 knowledge of the efforts to prepare some intelligence on
20 Iraq for Iran. My notes on our earlier interview
21 suggested that you had said it was about January 19 when
22 DDI Gates asked you to get involved, but apparently is
23 wrong. Do you remember what the date was?
24 A I don't know. It could have been as early as
25 the 19th and I may have misspoken a few moments ago.
wmmm
579
344
1 Q Is there anything you can attach your memory
2 to, any event?
3 A No. I know Bob Gates called me and said that
^^^^^^^^^^^^^^^^^^^^B would working on this issue
5 and that they would be visiting me about it, and that he
6 had ordered it be completed, I believe, by the 24th of
7 January, and I didn't know that the work was under way or
8 had been requested until Mr. Gates called me. And, as I
9 said earlier, he called me basically because so few
10 people knew what was going on; he didn't have anyone to
11 deliver the material to.
Who are^^^^^^^^^^^^^l What are"
13 they with?
14 A As I said earlier, they are with the^^^^^^^f
^^^^^^^^^^^^^^^^^^^^^^H Directorate
16 Intelligence. ^^^^^^
Q This would be under^^^^^^^^^H group?
s i r , |H|^H^^^^^^Boff i c e .
19 Q It doesn't make a great deal of difference,
20 but when I spoke with^^^^^^^^I was left with the
21 impression that he got that task on very much a hurry-up
22 basis around the 2 3rd or 24th, just before the
23 intelligence actually gets delivered. Do you think it
24 was a few days earlier?
25 A Well, I don't know. I really don't know how
wmssm
580
345
1 quickly they did this. I do recall as my memory is
2 refreshed that^^^^^^^Htalked about working very late
3 hours in preparing the intelligence, so it could have
4 been the 2 3rd that the request came. I do recall it was
5 during "thflr3««)bt It-^gts a j<orki»»-<l«^ijthT« Mr . Gates
6 callod me on^ecure aa^.saJH^ ^n^'this^^s ^^ppening and
7 that Z sh^^^kawait a:3/1i^ froa]
8 because th«y gA4|iar'r«iUieLj^°»»a^^^^ti9*»
9 As I recall, I didn't give them any guidance.
10 What they prepared seemed to be perfectly satisfactory.
11 Q In terms of the way the Agency was dealing
12 with Ghorbanifar at that time, would you have been aware
13 in that period, the period between January 17 and the
14 time you actually go to London yourself that further
15 communications were taking place with Mr. Ghorbanifar
16 about the Iran initiative?
You mean^^^^^^^^^^^l^^^^^^Hwould
18 I have been aware?
19 Q That's one place.
20 A Of further meetings?
21 Q Were other people telling you about them? Let
22 me give you a better questions, Mr. Allen. That wasn't
23 terribly helpful.
24 In terms of a meeting with Ghorbanifar planned
25 to occur at or about the 24th or 25th of January, would
wmmB
581
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346
1 you hav* known about that meeting before you got the
2 assignment to go out there on the 26th and, if so, how
3 soon before the meeting?
4 A No. X wasn't aware that a meeting would have
5 occurred on, I guess, the night of the 25th in London. I
6 do know that Colonel North was impatient around the 23rd
7 to get an intelligence sample to Mr. Ghorbanifar. This
8 was after Mr. Gates had told me one was being prepared.
9 Q From the Tower Commission report it appears
10 that North went to London on the 24th of January; is that
11 accurate or inaccurate according to your recollection?
12 A Colonel North went to London just prior to«the
13 24th, I believe, because Mr. Ghorbanifar gave him a whole
14 series of photographs and these were very interesting
15 photographs of some fairly nefarious-looking people. He
16 had a whole stack of them that he brought to the meeting
17 on 24 January in Mr. McMahon's office.
13 Q I tei^^Swhat. I thiSl^e best way to do
19 it is you can take me sequentially in terms of events as
20 you recall.
21 A As I recall, recognizing that my recall on
22 this may be imperfect, sometime either prior to the 23rd
2 3 or on the 23rd Mr. Gat^^.-^iljil an intelligence sample was
being that^^^^^^^^^^^^^^^^^^Hwere
25 involved. Colonel North was talking to me at that time
rolonel North was talking
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25
about the need to get intelligence quickly to
Ghorbanifar. He didn't suggest that there would be
necessarily a trip required to London that quickly.
It's my understanding that Colonel North had
been to see Mr. Ghorbanifar just around that date, the
22nd or 23rd, and that he had obtained a set of
photographs of people that Ghorbanifar claimed had
connections to terrorist networks or were actually
terrorists themselves. I was told, I guess by Mr. Gates,
to be at headquarters on Saturday the 24th of January'
because the sample would be addressed.
I arrived there that morning. I think I made
contact with^^^^H^^I^HH^^^Hand
finishing up the sample and explained to me how to
interpret it. I took the material up, as I recall, to
Mr. McMahon's office. ^^■■■^^B was there, Mr. McMahon
was there, Mr. Gates was there. I was there. And along
with — Colonel North arrived later.
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UNCl/ISSiED
348
iims by Mr. Ghorbanifar that
he had had contact with, I believe, the Vice President
and perhaps even the President]
Q The President and Vice President of the United
States, I take?
A Ves, which certainly was not true. So, as 1
further refresh my memory, it's possible that Mr.
Ghorbanifar was here and Colonel North did not go to
Europe and that that may not actually be accurate in the
Tower Commission report. I'm trying to reconstruct the
sequence of events. Nonetheless, there was a lot of
discussion there on the 24th, and I believe Colonel North
was at the beginning of developing a schedule, but he
didn't have much of a schedule at that stage.
We sat there discussing the intelligence.
John McMahon stated that he was against providing
detailed order of battle information to the Iranians, and
Mr. Gate seconded that comment. They told Colonel North
that this was being done at the direction of the White
mmsm\i
584
IINCmWD
349
1 House, but they wanted to note jointly that this was
2 against their best judgments. But they qualified this,
3 as I recall, by saying they did not consider this to be
4 intelligence that would be of any significant import to
5 the Iranians, given that this was in the mountainous
6 northern front and was not a likely point of attack for
7 the Iranian military. And I think they were correct in
8 that.
9 Then a whole argument ensued as to who should
10 take the darn stuff to London. I had no desire
11 necessarily to go to London, but when Ollie showed all
12 these photographs McMahon seized on the idea that I
13 should go because if these are terrorist somebody that
14 knows something about terrorism should try to obtain from
15 Ghorbanifar who these individuals were and why did he
16 have their photographs and what did it mean — a rather
17 ominous-looking set of characters.
18 So suddenly I found myself getting ready to go
19 to London that afternoon. So they sealed this
20 intelligence sample in sterile paper and I put it In my
21 garment bag, went home, packed and had my wife drive me
22 to the airport and went to London.
23 Q Let me give you a date and even to help us
24 focus in on things. On January 23, according to the
25 Tower report, you met with a follower of Ayatollah
UmtDSStFIED
585
UNCLASme
350
1 Sharazzi who was visiting the United States apparently at
2 Ghorbanifar 's request. Do you recall such a meeting?
3 A Yes. I don't think he was coming to the
4 United States necessarily at Ghorbanifar's"
5
6
7
8
9 Q Would you have met with him before this
10 meeting with McMahon?
11 A Yes. J
snphe
12 Q Okay. So that took place onphe 23rd. Youi^
13 meeting with McMahon would have been the 2 3rd or the next
14 day, the 24th?
15 A The 24th. It was a Saturday morning. I
16 thought this was an opportunity to evaluate a contact of
17 Ghorbanifar. I was impressed ^^^^^^^^H He was very
18 good.
19 MR. WOODCOCK: Mr. Allen, do you want to look
20 at that? It's an old '86 calendar, to give you some idea
21 of th« dates.
22 THE WITNESS: Oh, the 24th is a Friday. I'm
23 sorry. My dates are all wrong.
24 BY MR. KERR: (Resuming)
25 Q Let's go back and try and piece it together.
UNELJSSlfffifl
586
351
1 You were in London on Sunday, right, which would be the
2 26th?
3 A I arrived in London on the morning of the
4 26th.
5 Q So the meeting with McMahon and company would
6 have been that Saturday?
7 A Ves, sir, the 25th, the morning of the 25th.
8 I flew to London the afternoon or the evening of the 25th
9 and met with Ghorbanifar the evening of the 26th and
10 returned to Washington the morning of the 27th.
11 Q So the sequence would be 23rd you meet with*
12 the follower of the Ayatollah, 24th you are told by Gates
13 about the Iraqi intelligence, is that right, and then
14 meet --
15 A Well, I don't want to put a specific time
16 frame in view of what I said earlier, what you have
that^^^^^^^^said.^^^^^^^^^should have
18 better information than I do. It was, you know, sometime
19 during that time frame, during that work week, that Mr.
20 Gates told me that he was having an intelligence sample
21 prepared related to the Iranian initiative and that I
work with^^^^^^^^Bpeople
23 Q But, in any event, the departure from the U.S.
24 to London would have occurred — would you have flown
25 that evening, the 25th?
UNCOtSMD
587
Pan Am 106 to London.
Which would mean a flight out Saturday
The 24th, yes. I'm sorry, forgive me — the
- . .^„. , 352
1 A
2 Q
3 evening?
4 A
5 25th.
6 Q So you would have flown out Saturday
7 evening, the 2 5th?
8 A Yes. I definitely flew out the 25th.
9 Q Before we go to that meeting let me just ask
10 you a bit about what the Agency believed it was doing.'
11 You would have )cnown, I assume, on the 24th and 25th that
12 you were about to go meet and talk with Ghorbanifar. -
13 Were you aware that the Agency was putting out a cable
14 saying that it planned no further contact with
15 Ghorbanifar?
16 A No, sir.
17 Q Let me show you a cable dated January 17, 1986
18 which will be Exhibit 29, and I ask if you are familiar
19 with it.
20 (The document referred to was
21 marked Allen Exhibit Number 29
22 for identification.)
23 (Pause.)
24 A I've seen this. I don't recall when.
25 Q Do you remember where you saw it —
uimssra
588
wmmm
353
1 contemporaneously?
2 A No, sir. I didn't see it contemporaneously.
3 Q At a late date?
4 A I saw it at a later date, although I'm not
5 certain when.
6 Q To your knowledge was the Operations
7 Directorate aware of the meeting that was about to be
8 held with Ghorbanifar at the time they sent this cable?
^^H^^^^^^^^^^^Hwas the meeting
10 in during the entire session on Saturday morning on the
11 25th. He saw the intelligence. He saw the photographs.
12 He knew I was going to London to meet with Mr. ••
13 Ghorbanifar.
14 Q And^^^^^^mt that point was still deputy, or
15 was he chief of the Near East Division; do you recall?
16 A He was the Deputy Director of the Near East
17 Division, Directorate of Operations »t that time.
18 Q One other detail from that period of time.
19 Let me show you a January 21, 1986 memorandum from Clair
20 George on a re^esl^or sensitive support equipment,
21 which will be Exhibit 30.
22 (The document referred to was
23 marked Allen Exhibit Number 3 0
24 ^, for identification.)
25 The same drill. If you have seen this memo
u
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umssffl
before, please tell me; if not, I'll just use it as a
reference point.
(Pause. )
A At the time I did not see that,
contemporaneously. I knew on the 29th of January 1986
that he had such equipment.
Q Why did you know that on the 26th?
A He brought it with him when he had returned
from the aaetiii^ in3^don^^Tbel^ev«>_j^^E:^ri?*-
on yojar
trip^ dieT'you borrow frcnn COlbnUSSorth thia^ec^fii^liht «r '
nakA us« of similar iquJBB^"^ ^^ X****^ trj^g?^" ' ^_ . -^^' Jt
this equifiMn^n y«»«iiqr:, did tlSEn ,Wii- _¥r«fr-"f tii»r- *
when you actually «iw a tran«;ript-br h^Brd^ a^tape made
by 3Bh±« aqu ipna^!iaMi^anqagf o f ta«¥ "" ^"^-^^^t^I -
Q Vav you ,i^^i^ ^^ yoS" wj^^Sra^^that Hr.
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intelligance? - _ \^ .
A 1 dor?t remember. • %--
J^Q^ Do yfiu know where the Director was on January
24 and 25^986?^The cable S!^^|^HH ^* ^^''^
A ^h«S:'!^^^^^H JHJflduu overseas, an^;^ _.,
probably Jm«w iB"%h^jys^^s^|Sc« h«^wa«~bjiit._l don't
recall now precisely fffgffi^-* waii-«»s .k^eaS V " _' - -"
Q _l^^^^^k« a p<»i'^n In t^iic a^i^g^uih
North on Trtiet^- m" rint jr ifif^j jlijTiiF iir TMir'tiTfTi to-J
th i^gfentiSliaiOc*^^ 3^ ^M_J^S^»is?>
^- ^P bf<y^r^',_^.7"
Q You were there'll* .aiiK^tl t^ffT . ^eb&s were
talking about whether it -was a good idaa?^
'- I
»^fe«*-'**^«' J**,g^^«rt*Srrorl«t^
speak for the propriety" of~pas3lifig intelligence to the
Iranians.
Q Let me show you the cable, which will be
Exhibit 31.
(The document referred to was
marked Allen Exhibit Number 31
■me ^JbM^4^cat4pB^*!^~-
Just if you would review it briefly and tell
me if you sjug-^it at or about the time of its date.
UNCDtSSn
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1 A I have never seen the cable until now.
2 Q Did you have a meeting with Ghorbanifar the
3 weekend of the 25th and 26th of January that was attended
4 by Mr. Ledeen?
5 A I had a tape recorder that kept running when
6 Mr. Ledeen arrived after traveling from Rome to
7 Ghorbanifar 's room, 926, in the Churchill Hotel.
8 Q So the transcript that we have of a meeting
9 which is dated the 25th of January would have been a
10 transcript of a meeting that took place in London; is "
11 that right?
12 A That was, I believe, and I don't know the •,
13 accuracy of the transcript because I have never looked at
14 it in detail, but that was taken from the tape recorder I
15 used in a meeting with Ghorbanifar, I assume. I would
16 like to see it to identify it properly.
17 Q Let me show you a transcript of what's called
18 Cassette Number 7, marked Ghorba (MC 2), Senate numbers
19 C-3991 through 4015, CIIN 1527/A, which will be Exhibit
20 32.
21 (The document referred to was
22 marked Allen Exhibit Number 32
23 for identification.)
24 (Pause.)
25 A Yes, this is part of the tape that I retained
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1 after I wrote up my memorandum, I think, of 18 February
2 1986.
3 Q Tell me a little bit about how this tape was
4 made. Was this an overt tape recorder or a covert tape
5 recorder?
6 A Overt.
7 Q Overt?
8 A Ves, sir. I put it on the coffee table and
9 said I'd like to tape record what you have to say, and I
10 assume that you will agree, Mr. Ghorbanifar, and he said
11 yes.
12 Q And this tape would have been made in your*
13 hotel room in London?
14 A No, sir. It was in his hotel room, Room 926,
15 Churchill Hotel, Portman Square.
16 Q And Mr. Ledeen joined you at some point in the
17 conversation?
18 A Very late in the conversation and I think we
19 stopped our conversation essentially substantively.
20 Q How did Mr. Ledeen know that you and Mr.
21 Ghorbanifar were going to be getting together in London?
22 A He kept close track on Mr. Ghorbanifar and he
23 showed up unexpectedly from Rome.
24 Q So you didn't anticipate that he was going to
25 be meeting you?
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1 A No.
2 Q Th« tap* appaanTto starfF tii^te* «iddle of a
3 conversation. Do you know of any additional transcripts
4 that might be outstanding on this conversation?
5 A I have turned in all the tapes I have. I
6 don't know of any other cassettes that I have.
7 Q If you could just glance at the transcript.
8 Is there any other typewritten transcript that you know
9 of of this conversation other than what appears before
10 you?
11 A Well, I wrote the entire substantive content
12 in the 18 February memorandum.
13 Q I mean a verbatim transcript.
14 A I have no other verbatim transcript.
15 Q So in terms of what might precede where this
16 tape starts you've not seen a transcript of that
17 material?
18 A No, sir.
19 Q If you don't mind, the first paragraph or so
20 talks about ^HH^^Lnd the like for Mr. Nir. What was
21 that conversation relating to?
22 A I think it's in my memorandum. And I'd have
23 to refer to that. I believe there's something about
^^^^^^^1 in the
25 Q It didn't jump out at me.
UNCUtSSIFIED
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A I'd be very surprised if there wasn't.
Q Let me have you pick it out. Let me show you
your 18 February memo of the January 2 3 meeting, which
will be Exhibit 33.
(The document referred to was
marked Allen Exhibit Number 3 3
for identification. )
(Pause. )
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Q During the course of this conversation Mr.
Ghorbanifar again made a reference to helping Ollie for
his work in South America, did he not?
A Yes. I did not recall this until after I
started looking at my notes and having talked to the
Inspector General's staff, I guess, in November-December
He raised ^^^^^^^^^^^^^^^^m^H^^where
he made what I thought was a rather grandiose statement
thatH^H^^^Hwould provide at this time not $100
UNCtASMD
596
um4ssn
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1 million but $50 million, and I notice in my notes $25
2 million for him and $25 million for Ollie North.
3 It seemed to me sort of a very ingratiating
4 type comment which had little or no substance so 1
5 certainly didn't record it in my memorandum for the
6 record, because that seemed so far-fetched. I had no
7 confidence that it had any meaning and, of course, I did
8 not pursue it, as my notes indicate.
9 Q You didn't pursue it in the sense of even
10 asking him how or what he knew about Colonel North's '
11 activities in Central America?
12 A ■ I never discussed what he knew about Colone^l
13 North or Colonel North's activities in Central America.
14 Q Well, me why not. I don't understand that.
15 A Well, I focus functionally worldwide on
16 counterterrorism, and when I waa^ it^^eji^artment of
17 Defense working with Colonel North I dfd^ not work on
18 Central America, so I had little or no interest except as
19 just another average citizen in what was going on in
20 Latin America. I'm interested in Latin America from a
21 terrorist point of view and I have focused from time to
22 time on Central and South American terrorism.
23 But basically on the contra issue I had no
24 knowledge and did not follow it at all. I wasn't even
25 reading the press in any detail about the contra issue.
UNCtJtSSIFIED
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1 so it was really not in my frame of reCerenc*. So to me
2 an outlandish statement like this did not merit any
3 particular pursuit.
4 Q You were aware at this time that it was not
5 . lawful for the United States Government to be
6 contributing money to the Nicaraguan contras?
7 A I had heard of the Bolartd Amendment and the
8 approach in the Boland Amendment, but I had not focused
9 on that whatsoever.
10 Q Just in terms of your responsibility as a
11 Federal official, if someone told you that there was an
12 illegal act going on, no matter what the level in the *
13 government, you would have explored that?
14 A If I had bona fide hard evidence that some
15 illegality was occurring I would have taken it to an
16 appropriate official. The fact that somebody was saying,
17 you know, what I want is to join hands with the Agency, I
18 am a turnkey project individual, I have all these very
19 excellent contacts with terrorist groups, Iranian in
20 particular, some with Syrians, some with the Libyans, and
21 I know this great project and if we handle it right and
^^^^^^^^^^^1 they us
23 million for me, $25 million for Ollie's boys in Central
24 America.
25 The only thing I recorded which caught my
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attention was the possibility of an operatic
That was
not out of bounds. That was plausible. Something like
this seemed absolutely implausible and I totally forgot
about this.
And the first time I recalled this was after
talking with the Inspector General's staff and they
brought to my attention in March of 198 6 George Cave had
written a memorandum on a yellow piece of paper, one
sentence that Ghorbanifar said, you know, that we canget
some profits out of these arms sales and use them for the
contras in Central America. And they said did you not
recall reading that, and I very candidly at the time, I
said I read the memorandum and I may have read that
sentence, but it didn't stand out in my mind and Mr. Cave
and I never discussed it.
And a similar couple of comments in my notes
like this, I never considered it valuable enough or
significant enough or credible enough to put down or
bring it to anyone's attention. If I had detailed
information and evidence that an illegality was
occurring, I certainly would bring it to the rttention of
the responsible officials.
Q Vou do not recall making a conscious decision
not to inquire into these matters?
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1 A NO, sir, not at all. It just wasn't in ay
2 plana of reference. I'm sorry, but it was not.
3 Q All right. You recall, do you not, that after
4 you put out your memorandum on your conversations of 13
5 January and 2 6 January with Ghorbanifar the Operations
6 folks from the Near East division also put out a
7 memorandum commenting on matters which you had touched on
8 in your memoranda? Do you recall receiving that
9 memorandum?
10 A I don't think they sent me a copy at th« time.
11 I've read that memorandum at soma point. ^^^^^^^^^H
12 said ha was anxious to get my memorandum of particular^ 18
13 February because they wanted to do soma research and
14 analysis on it. I don't recall that ha aver passed that
15 to ma at the time when that memorandum was written. I
16 have read it at soma point. I read it at soma point.
17 I did not attempt to, you Jcnow, do research on
18 this. I felt that was his role to do so. ' Mf^ Job was
19 simply to elicit from Mr. CRorbanlfar what ha knew,
20 record it in detail. Operational research, name traces
21 and evaluation was beyond my scope. I just didn't have
22 time to do those things. I am unhappy that it was not
23 sent to me immediately. It would have, I think, put a
24 little bit of perspective on Ghorbanifar for ma.
25 Q It was apparently addressed to the Director.
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UNCLASSIFIED
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1 Did Director Casey not talk to you about this memorandum
2 in light of the fact that you send him two memoranda on
3 Ghorbanifar?
4 A No, sir.
5 Q He did not. Okay. Let me show you the memo.
6 A To the best of my recollection he never
7 mentioned it. ;_
8 Q Let me show you the memorandum, which will be
9 Exhibit 34.
10 (The documan%.r«i*rra^ to was
11 marked Allen Exhibit Number 34
12 for identification.)
13 If you would look at the memo and identify it
14 as the memorandum that you were given at some point.
15 A I believe I reviewed it much later.
16 Q When you say "much later", can you give me a
17 referenc*? Would it have been in late '86, ejuTly '87?
18 A I I think it was probably in late '86.
19 Q How did it come to your attention?
20 A ■■=J[, 4>m't recall. I did not see it at the time
21 of the, say, February-March time frame. I did not see
22 it.
23 Q Now let's go to your meeting of January 29,
24 1986. There is a passing reference to that meeting in
25 the collection of your notes that's attached to Mr.
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1 Rlzzo's letter, if you want to use that as kind of a way
2 of focusing your recollection.
3 The note, Attachment C to Exhibit 27, appears
4 to be a handwritten time chart or schedule. Can you tell
5 me, first, what this is an excerpt from?
6 A It's from notes that I took at the 29 January
7 meeting in the Executive Office Building, Room 370.
8 Colonel North had just returned that day from, I believe,
9 London. He arrived from the airport and called a meeting
10 late in the afternoon or early in the evening — it may
11 have been 6:00 or 7:00 when we came together.
12 His secretary called, Ms. Hall, and said that
13 ^^^^^^^^^|and I were requested to come to the Executive
14 Office Building, that Colonel North had some important
15 information to discuss. So X went with^^^^^^^^H We
16 probably went separately, but^^^^^^^^Hand I were
17 there, along with Mr. Koch and Colonel North introduced
18 me to Major General Richard Secord.
19 Q Just another preliminary. North was returning
20 from London, who had he been meeting with, if you know,
21 in London?
22 A I think he had met with Amiram Nir and
23 Ghorbanifar. I think.
24 Q I understand you weren't there.
25 A I wasn't there and don't have any notes at
I wasn't there and don't
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1 this stage.
2 Q But to help me out, on the 26th you were
3 meeting yourself with Ghorbanifar and Ledeen. Did North
4 pass through along the way at that point? Did you see
5 him in London?
6 A No, sir. I turned around and returned on the
7 27th.
8 Q When you were meeting with Ghorbanifar did he
9 indicate that he was anticipating a meeting with Korth in
10 London?
11 A I don't recall that he did. I haven't
12 reviewed that transcript.
13 Q I don't see anything in there. I would have
14 pointed it out.
15 A I don't recall he mentioned it.
16 Q All right. Do you have any current knowledge
17 of what North and Ghorbanifar and Nir would have been
18 talking about at that meeting in London?
19 A The only knowledge I have is what Colonel
20 North told me, told at that meeting, and because Mr. Koch
21 was not fully into the program or the initiative but only
22 partially, he was somewhat guarded as long as Mr. Koch
23 was around during the meeting.
24 But he stated that he had had a meeting with
25 an Iranian and that an arrangement had been agreed upon.
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1 a detailed schedule worlced out, and then he proceeded to
2 read from a notebook a very detailed schedule, starting
3 one date after the other. And that schedule, that
4 handwritten schedule, later became a printed schedule and
5 he had a very finely developed scenario where eventually
6 a certain amount of equipment, particularly TOW missiles,
7 would be sent to Iran.
8 As certain segments occurred, hostages would
9 be released, eventually including the remains of William
10 Buckley. At some point Ayatollah Khomeini would step
11 down. And I recall that I laughed aloud at that stage
12 and I believe ^^^^^^^^H joined me in that.
13 We didn't think that was terribly plausible,
14 but he was quite serious in the scenario and schedule
15 that he had drawn up. He indicated that that could well
16 slip but that the sequence should remain about the same.
17 He felt that there would be a relatively early resolution
18 of the hostage issue and he spoke briefly, as I recall,
19 about broader aspects of U.S. -Iranian relations.
20 And I don't recall exactly how he explained
21 all this to Mr. Koch, because he knew that I knew in
22 detail what was happening, as well ^^^^^^^^^^B ^'^'^
23 certainly Major General Secord, but he was somewhat
24 cautious in describing some of this because Mr. Koch was
25 going to have to arrange, working I guess with CIA, for
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1 th« movement of the TOW missiles from depots where they
eventually go ^°H^H^^^^^^^^^^^^^^H be
3 repackaged and sanitized, and then moved on in some way
4 to Israel and eventually on to Tehran.
5 So the meeting went on for an hour and a half,
6 I guess, something like that.
7 Q Vour recollection of why Koch was there was
8 primarily because of the need to get the missiles from
9 DOD stocks; is that right?
10 A That was my impression. And Colonel North Z
11 recall cautioned me during the meeting that Koch was not
12 witting of the entire initiative and it was important *
13 that we try to keep it as compartmented as possible and
14 that we not be fully open in our conversations. He
15 cautioned me in an aside, saying — which Z appreciated,
16 because he did not give me any advance guidance. Z
17 thought Mr. Koch may have known a great deal.
18 Q With regard to what you and^^^^^f knew about
19 one another. You and^^HH|||||||had both known that you
20 were involved in this project before the 29th of January?
21 A Well, we had known of the initiative for some
22 time, yes. And we knew that there was a Finding. Z had
23 not read the Finding, but Z knew in general the terms of
24 the Finding.
25 Q So I can be more precise, so far as you
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understood it.^^^^^^H^Hwas aware that Colonel North
was working with and through you on certain aspects of
this initiative; isn't that correct?
A I don't think he was working through me. I
think he was working concurrently. It was clear that^^H
[would be doing the operational support to the
NSC. ^^^^^^^^Hat that stage was very interested in
the intelligence, the tasking and collection of
intelligence; therefore, we worked out an agreement where
I would ensure that he would seel^^^^^^^^^^K I tried
to faithfully do that throughout the rest of the year.
I recall once or twice he didn't see
land he was quite annoyed that I didn't
promptly get them to him. So I tried to rigorously give
him that information as well as my memorandum for the
record. I tried to send him all copies. My secretary
was under instructions to hand-carry them tc
loffice.
Q Let me phrase it another way. When you met
with^^^^^^^^l and the others on the 29thl
did not evidence any surprise that you were involved in
this matter at that time?
A No, sir, at least I don't recall it, since
we'd had lunch and discussed the initiative and he
already had some of my memoranda.
UNCIKSSIFIED
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1 Q That was my recollection, yes, sir.
2 with regard to the money flow that's outlined
3 in this note, I take it that Colonel North outlined the
4 flow of money in this meeting.
5 A There were some costs spoken about, shipment
6 costs, I see. Yes, he outlined some broad figures which
7 I tended to jot down.
8 Q But he also outlined at this meeting, I take
9 it, how the money was going to pass — that it was going
10 to go from the Iranians to the Israelis and from the
11 Israelis to Ghorbanifar — excuse me, from the Iranians
12 to Ghorbanifar, Ghorbanifar to the Israelis, and the ■■
13 Israelis on to Secord. Isn't that basically what he was
14 telling you?
15 A My arrows would suggest that you are correct
16 in that statement.
17 Q Was that the first occasion that that kind of
18 flow of money had been outlined to you?
19 A Absolutely. That came as a revelation on just
20 how monies might actually flow in this and that Mr.
21 Secord would then send the monies that it cost the Agency
22 to repay DOD as well as associated costs of packaging and
23 sanitizing the materials and transporting.
24 Q Was there discussion of why General Secord was
25 being inserted as a conduit in the money flow at that
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1 point?
2 A No, sir.
3 Q There was not?
4 A No, sir. He was quite silent.
5 Q Secord was?
6 A During most of the hour and a half he only
7 occasionally made a comment — very, very quiet.
8 Q with regard to the reason for the Israelis
9 being inserted in this flow of cash was there any
10 explanation of that given to you at this meeting?
11 A No, sir.
12 Q If I'm understanding what happened. North "
13 basically said this is the way it is but he didn't
14 explain why this is the way it was; is that right?
15 A He indicated that the money flow would be this
16 way and that the Agency would be reimbursed. We had to
17 have assurance, as I recall, that the actual money would
18 show up into a CIA account before we moved the equipment.
19 I recall .«one discuss^ft «^|ffi9- <@tos«iiJ.in||f • But I.was
2 0 more, you^know, looking^^^tlji^fp aniop^B^ptwriyuL-lSpE'do
21 more collection tasking and knowing the schedule.
22 Q "In terms, though, of what you do recall about
23 the meeting, do you recall any discussion of the risks to
24 operational security of having intermediaries outside of
25 both governments inserted into this kind of a process?
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1 A Out of both governments?
2 Q Instead of government-to-government transfer.
3 A Outside of?
4 Q Let me come at it another way. Was there any
5 discussion of operational security concerns arising out
6 of using private intermediaries in this kind of a
7 transaction?
8 A I don't think there was any discussion,
9 certainly at that time, and during the course of this
10 initiative I think Mr. Cave and I thought about this on a
11 number of occasions, but at that time there was no
12 discussion of those operational risks.
13 Q One curiosity I have, based on what a number
14 of people have said from the Agency, you all treated this
15 thing, I gather, in January as being essentially a
16 support function. You were going to do what the NSC
17 needed help on, but it was their baby. Is that the way
18 you all perceived it?
19 A We had been assured by Mr. McMahon and Mr.
20 Gates that there was a Finding — at least I had been
21 assured at the meeting on 25 January — that we were
22 going to provide some intelligence support and we were
23 going to provide some assistance in moving U.S. weapons
24 through a number of cutouts ensuring that that money —
25 those weapons. ariLl^ed in^&da^lteWthere was a funding
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1 mechanism that had been set up to ensure that the United
2 States and the Agency would be paid before it undertoo)c
3 this activity, but that this was Presidentially-approved,
4 that the Directorate of Operations was to support it.
5 My role was to continue to ensure that we had
6 some checks on the intermediaries in the best way
7 possible, that we had to know what Ghorbanifar and other
8 elements in Iran were up to. So I looked — the reason I
9 was asked to come there was that Colonel North wanted
10 intense intelligence collection and checks the best we
11 could on Iran, the government of Iran, and on the Iranian
12 intermediary.
13 So yes, I viewed it as a fact that the Agency
14 had been asked to support this by the President of the
15 United States.
16 Q You were all aware, however, that Colonel
17 North, whatever his virtues and skills, was not an
18 experienced operations officer in his own right — that
19 is operations in the sense of covert operations?
20 A I was aware he was not part of the Agency and
21 considered an experienced operations officer. I'm not
22 going to comment on Colonel North's qualities or
23 abilities.
24 Q I think it is worth commenting, Mr. Allen.
25 Let me tell you where I'm coming from so you don't take
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1 it amiss. It would seem to me that you anc^^^^^H in
2 particular are very experienced men in this line of work.
3 ^^^^^^Hhas been doing it for decades, I guess — a long
4 time.
5 A He's much older than I am.
6 Q What I'm curious about is you all apparently
7 for some reason didn't feel it appropriate to advise and
8 counsel Colonel North when, if you did, you thought he
9 was making operational judgments that might be
10 questionable, and I would like to know why. Why didn't
11 you say, 01 lie, wait a minute. Maybe you ought not to do
12 it that way.
13 A You mean at this juncture?
14 Q At that juncture.
15 A Right now?
16 Q Yeah.
17 A At the time we, as I told you, I had already
18 had discussions with Mr. Casey about this and I think he
19 viewed it as a high risk operation. At this stage I was
20 simply trying to absorb a lot of new information on
21 funding technic[ues, on schedules. There was a feeling
22 that this would be over with fairly quickly and
23 successfully.
24 In retrospect, if we could always think back
25 and do differently, I probably would have cautioned him
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1 that Colonel North was an individual I could talJc to
2 candidly. Particularly in my OSD days I took Colonel
3 North on a number of times successfully. But I did not
4 question at this stage.
5 Q Is that because you — let's talk about you —
6 you did not really see an unacceptable level of risk at
7 this point?
8 A I think that's basically it. I know and I had
9 dwelled on the point that, certainly mentally and
10 internally, that there would be political fallout if this
11 was suddenly exposed, but at the same time I recognized
12 the political value if this was a success, particularly
13 in narrowing the problems in southwest Asia, and that was
14 my principal concern at that time.
15 I had suddenly been saddled for 3 0 days with
16 the hostage problem, which was taking up an inordinate
17 amount of my time. I also wanted that resolved, very
18 candidly, very pragmatically, and I did not think that
19 was an ignoble objective, to try to save the lives of a
20 number of Americans in Lebanon.
21 Why I did not question it? At this stage it
22 had not been tried. This was a new approach and there
23 was a certain plausibility to it, that it might be —
24 sometimes private initiatives in our history have proven
25 to be very successful.
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Q Let me deal with the risk factor, though, as
it relates to intermediaries because that's what truly
puzzles me, and maybe it is the benefit of 20/20
hindsight, but I want your thoughts on it. It would seem
to me here, where I gather you were not being told of how
you would determine what the Iranians were going to pay,
that that was kind of left out there, something you all
weren't going to know about.
Nothing causes people to get mad and take
revenge quicker that I can think of aside from being
scorned in love than stung for money. And that danger
would be inherent in this kind of a setup. '
A It was potentially there, and I agree with
your comment, that people who are out money can be very
revengeful. At this stage, though, I had no inkling that
there would be a true falling out in the summer of '86
and that this thing would go on. He had the feeling,
really, that there was a finite process in motion, that
I think that also shaped my thinking,
recognizing that the Israelis would like nothing better
than to influence us in certain ways to further Israeli
interests. I think we always realized — at least I did
UmSSIFIED
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— the Israeli agenda here. I can't speak for others.
But at this stage it was a plausible scheme
and potentially workable. The schedule, as you recall,
was typed up and a copy was made available which I think
was kept in Mr. Clair George's safe, as I recall — I may
be wrong in that — but it was kept in someone's safe.
Q Let me give you another operational security
question. You certainly were aware, whether you read it
or not, that General Secord had unkind things said in the
press about his involvement for money with Wilson. You
were not aware of that?
A Let me jump ahead a little. As soon as I
recognized Mr. Secord was involved, I recall discussing
this with^^H^^H^|^H^^^^^^H|^HH|^^HH
^^^^^^^^^^E^said this name sort of rings a bell. You
better check into some people^^^^^^^^^H
what they know about General
And he discusaed this, I think, with^^l
and^^^^^^^^^^|recalled Major
General Secord had resigned from the Pentagon. He was on
the list to make three-star, and just at the time he was
on the list to be promoted it came to the attention of
Mr. Carlucci that Mr. Secord was involved in some
614
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1 problems with Mr. Wilson and the star was taken away and
2 Mr. Secord retired from the military.
through^^^^^^^^^^^^^^^^^^^Jmade known
4 the background on Secord and indicated that he had had
5 some problems in the past. But I got that, I think, you
6 know, sometime in February and that worried me, yes.
7 Q With that worry, did someone, you for example,
8 go to Colonel North and say. Colonel North it's not
9 necessarily a good idea to get somebody that the New York
10 Times is particularly interested in in the position of
11 being the guy that's handling the money going to and from
12 Iran? Any suggestion of that sort raised to Colonel <-
13 North?
14 A I don't recall raising Major General Secord's
15 reliability in the February-March time frame.
16 , Q Any recollection of^^^^^^^^Hor operations
17 people would have brought that to the attention of
18 Colonel North as something to give some thought to?
19 A Z recall that they never told me about it.
20 Let me put that properly. To the best of my
21 recollection, they never discussed --^^^^^^^^H never
22 discussed that with me.
23 Q Let oe flip 1 1 nrminrU HIJ ignfBneT ^Hnrt j>.. rrrr
24 tell you in the January-February-Marc^^^riod of^'lkae why
25 he was placing jpartieular reliance or confidence in
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1 Ganaral Sacord?
2 A H« spoks highly of Ganeral Sacord 's ability to
3 (juickly gat things dona and to cut through tha
4 bureaucratic process. It's clear he had high regard for
5 Major General Secord.
6 MK. WOODCOCK: Let ma ask a quick question.
7 Did you share withf^^^^^^^Hthe information that you
8 received on Mr. Secord?
9 THE WITNESS: I don't think so, but I don't
10 recall.
11 BV MR. KERR: (Resuming)
12 Q What was your relationship with^^^^^^^^^|
13 during that period of time? Was it strained or did you
14 have a very comfortable relationship?
15 A It was cordial. He was working in a different
16 aspect of this and quite busily, along with all of the
17 operations of the Near East/South Asia, and I was focused
18 on global terrorism. This clearly took extra hours of my
19 week, but I did not have time much to sit and reflect on
20 this from an operational security point of view or
21 reliability of intermediaries. If I had nothing else to
22 do but focus on this — and that was, I think, the beauty
23 that Mr. Cave came in on 5 March and ha essentially ended
24 up spending most of his time working out of my office.
25 Q Just one other question on that. By the end
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1 of January, moving into early February, Mr. Clarridga has
2 done his report which ultimately is used as the basis for
^^^H^^^^^^Hj^^^^^^^l process was under
4 way by the end of January '86; isn't that correct?
5 A Yes. A decision had been made to form^^^l
6 ^^^^^^^^
7 Q Had the decision that you would be a part of
8 i^^^^^B^^^° been made at that point?
9 A Sometime around that time frame, yes.
10 Q Was there thinking at that time of taking the
11 hostage issue, at least as it related to Lebanon, away
12 from the Hear East Division and putting it into]
13 as of January-February '86?
14 A There was. Mr. Clarridga wanted it under his
15 aegis, but that process was negotiated over a period of
16 , months after that, and even though
17 ^^HHH followed hostage issues it wasn't until later in
18 the spring or early summer that the entire account came
19 to^^HfroB an operational collection point of view.
20 Q You were aware thaajj^H^HB^opposed having
21 the hostage matters in Lebanon taken from the
22 jurisdiction of Hear East and put into^^H^H isn't
23 that correct?
24 A It's my understanding from discussions with
25 Mr. Clarridga thatfl^HHj^^Hj would have preferred to
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382
1 hava kept the hostage issues under his aegis. ^^^H
2 ^^^^BBwas making what he believed to be good progress
3 at the time. In fact, I was quite encouraged with soma
4 of the collection efforts undei^HjHj^H^^HBaegis.
5 Q Did that jurisdictional evolutionary process
6 affect adversely your relationship withl
7 A No, I don't think so. That was a matter
8 between senior officials of the Directorate of Operations
9 and I was not involved in that decisionmaking. I was
10 more interested in the coU^rip^pn results, also in
11 getting requirements to the field as Director of the
12 Hostage Location Task Force. That was my focus.
13 Q By this point in time, late January or early .
14 February 1986, you had become aware, had you not, that
15 Mr. Ghorbanifar was doing business with Mr. Khashoggi on
16 arms deals?
17 A Can we take a break? I'm starting to fade and
18 I want to be able to answer these questions as precisely
19 as possible.
20 (A brief recess was taken.)
21 BY MR. KERR: (Resuming)
22 Q Where were we? We were going to talk about
23 Ghorbanifar and Khashoggi. Mr. Allen, I wa« trying to
24 ask a question before we broke. Let me try it again.
25 la terms of your knowledge of Khashoggi being
in terms or your Knowieagi
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UNIlASSra
383
1 a part of Mr. Ghorbanifar 's, the business side of Mr.
2 Ghorbanifar 's efforts on this transaction, were you aware
3 that Khashoggi was playing a role by late January-early
4 February of '86?
5 A I don't think so. I don't think that I knew
6 he was involved in the financing aspects. Sometime
7 during the late winter or early spring of 1986 Mr. Ledeen
8 mentioned that he had had dinner in London with Khashoggi
9 and Ghorbanifar and spoke of what an extravagant dinner
10 it was indeed. So I won't proceed further with any more
11 descriptions.
12 But that suggested to me, at a minimus, the
13 two knew each other, but he did not speak, Mr. Ledeen, of
14 Khashoggi being involved that I can recall, being
15 involved in the financing.
16 Q Let me try to refresh your recollection, if
17 not as to this transaction at least as to the existence
18 of major transactions that Khashoggi and Ghorbanifar
19 appear to have been putting together. Let me show you a
20 menorandUB froo^^H^^H dated February 10, 1986, CIIN
21 number 1025, and with it is CIIN 1026, 1027 and 1028, the
22 last of which appears to be addressed to you, ^. Allen.
23 That will be Exhibit 35.
24 (The document referred to was
25 narked Allen Exhibit Number 3 5
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for identification.)
A Yes, I recall seeing this last document at
some point.
Q Oo you recall it being in the February '86
time period?
A Z can't put a date on when I saw it. Z take
it on faith that this was sent to me in the February time
frame .
Q End of February or beginning of February?
A I said in the February time frame. I assume
at the beginning of February. -[
Q Do you recollect who sent it to you and for'
what purpose?
A I don't recall who sent it to me. It clearly
came from the Directorate of OpiKrations and it could be
someone in the Near East Division sent it to me, and I
ass\im« that's where it came from, for my information,
because they knew that at that stage I was maintaining
some, at least, telephonic contact with Mr. Ghorbanifar.
Q In terms of the reference to Mr. Khashoggi and
his relationship to Mr. Ghorbanifar, did you make any use
of that information?
A
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8 So after soma discussion I don't think Z
9 pursued it. I've always regretted I didn't.
10 Q Oo you recollect bringing this Khashoggi
11 aspect to Director Casey's attention?
12 A I don't think I did. I don't recall ever V
13 doing it, no.
14 Q So in this period of time you have no at least
15 present recollection of having a discussion with Casey
16 that Khashoggi was involved in some fashion with
17 Ghorbanifar?
18 A No, sir, I don't have a recollection.
19 Q And similarly nothing was said to you by Casey
20 about business relations or acquaintances he had that had
21 dona business with Khashoggi?
22 A No, sir, he didn't.
23 Q According to the Tower Commission, Colonel
24 North was in London to meet with Ghorbanifar and Mr. Nir
25 on February 5, 1986 and he returned on or about February
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either^^^^^^^^^^^^^^^^^V Mr.
2 Koch and General Secord. Do you recall the events of
3 February 5 through 7, '86?
4 A Well, I think I can clarify that. I think
5 that that particular reference was to the 29 January
6 meeting and I believe there was only one meeting, and I
7 think I caused the confusion by stating that I thought
8 the meeting occurred around February 7 and^^^^^^^^^B
9 said he felt that that was the wrong date. He couldn't
10 put a time frame on it, but he thought it was in January.
^^^^^^^^Hwas
12 discovered my notes saying it was 29 January. There was
13 only one meeting, sir.
14 Q The only problem with the chronology is
15 apparently the Tower folks are making reference to a
16 North calendar that shows him returning from London on
17 February 7. Do you happen to have a calendar that would
18 show when you would have met with Secord, et al. to have
19 this meeting which shows up on your notes? '-' "
20 A The Independent Counsel has my calendar,
21 doesn't he? "^
22 MS. -MC GINN: I'm not sure. If you gave it to
23 us, he has them. - -»- -
24 THE WITNESS: I don't have my '86 calendar,
25 sir. It has been gone for weeks. I as a general rule.
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ICUSSiEO
387
1 however, instructed my secretary on sensitive meetings
2 relating to this initiative never to put it in the
3 calendar.
4 BY MR. KERR: (Resuming)
5 Q All right. So the meeting that we have been
6 discussing as being the January 29 meeting by your
7 recollection would be the meeting the Tower Commission
8 references as being in the February 5-7 period of time?
9 JV I think so, and I think I contributed to the
10 confusion. I think ^^^^^^^^| had the correct time
11 frame, although he didn't have a specific date. He said
12 late January.
13 Q That's fine. Thank you.
14 Now I want to break away from Ghorbanifar,
15 Iran and the like for a moment and go to knowledge that
16 you would have had of a potential money for hostage
17 transaction, specifically the payment of money, whether
18 one characterizes it as bribes or ransom, to folks
19 holding American hostages. We talked about that the
20 other day.
21 Z wanted to show you two docxunents, one that
22 we talked about this morning, the January 15 document,
23 but also a memorandum dated February 7, 1986 which refers
24 to you, Mr. Allen, I think, in passing, and I don't mean
25 to suggest to you that you necessarily even saw this
UNetASW
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388
1 memorandum, but I'd like you to look at it and keep in
2 mind the January 15 item that I showed you earlier this
3 morning and see if it gives you any further recollection
4 of knowledge that you would have had in the January-
5 February '86 period of a proposal or program or possible
6 operation involving the payment of money to people
7 holding American citizens hostage.
8 The item I am going to show you is a February
9 7, 1986 memorandum, our number N-9213, and consists of
10 one, two, three pages relating tol
11 (The document referred to was
12 marked Allen Exhibit Number *36
13 for identification.)
14 A I think his name ^^^^^^^^^H ^° Y^^ want me
15 to comment on this?
16 , Q Yes, sir.
17 A When I became Director of the DCI Hostage
18 Location Task Force I became aware that a consultant to
19 the Department of State's Office for Combatting
20 Terrorism, Mr. Terry Arnold, had been working on a number
21 of projects for Ambassador Oakley and that he had had
with^^^^^^^^^^^^^^^l^^^^^^^^^^^^^B^^^
^^^^^^^^ He ,B|^^^^^^^^^|was under
24 time, had had his passport lifted. He was either under
25 indictment or had been indicted, had been tried. I don't
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know precisely what It was.
He had come through Ross Perot's, a senior
official in Ross Perot's organization had asked Colonel
North to look into the fact that^^^^^^^Hhad some
extraordinary contacts
lad lived life truly in the fast lane —
and that he felt that this individual might have contacts
that could assist in freeing the American hostages.
Mr. Arnold, at Colonel North's request, had
been working witt^^^^^^^^^H and Mr. Arnold is
rather benevajjieot- jgetired Foreign Service Officer bac]c on
contract — or was back on contract. Colonel North
wanted someone else to assess this fellow. I met him
once in Washington. ^^^^H^^Hhad been interviewed
one or more times by the FBI.
I bought this chap dinner. I did not like
what I saw. He was talking about contacts. I gave him
no encouragement whatsoever, called Colonel North the
next day and said that this man is untrustworthy. I
don't think he had the access. I gave him an assignment^
said if vo^ really have access)
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When you give nel
X think perhaps you have some
credentials. I don't know any of the details on some o£
his grandiose schemes. ^^^^^^^^^^^Hcontinually tried
to stay in touch with Arnold. He continually called the
Department of State. He had some officials of Ross
Perot, I think, calling Colonel North on this. He was a
genuine nuisance.
The last time he caused problems was in the'
late summer of 1986, when he confrontedj
land frightened j^^^^^^^^H and I called Mr. Buck
Revell and Mr. Buck Revell sent some agents to visit^^^H
and I think that's about the last I've dealt
with him.
Q So in terms of knowing anything that you would
consider concrete in terms of a proposal to pay money for
American hostages, this does not stir any further
recollection?
A That doesn't hold water. Colonel North, Mr.
Arnold, no one in the U.S. Government had any confidence
in this individual that I consider sleazy.
Q Do you know who the author of this memo is?
A It looks like it's prepared on White House/NSC
type print. The material clearly is Mr. Arnold, because
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391
ha used to send me memos or^^^^^^^^^^H and I have a
file, or the hostage location task force has a file on
It may be that Mr. Arnold had that composed
over at the White House, but I shouldn't speculate. It's
not my business.
Q Thank you.
A I think Colonel North accepted my view that
[was a man that offered nothing for the U.S.
Government .
Q With regard to your relationship with Mr.
Ghorbanifar, we have a number of memoranda of telephone
conversations that began in February and continued in -one
fashion or another for quite some time thereafter. How
did it come to pass that Mr. Ghorbanifar and you became
correspondents, if you will?
A This was basically while he was working for
the NSC. It was believed, and Colonel North asked that I
remain in contact with him as a way to stay in touch with
where ha was.
At the same time, Mr. Casey had made a
decision that we would continue to, if I can use a
colloquial expression, string Mr. Ghorbanifar along,
imtssra
627
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392
1 showing interest in counterterrorism, that as soon as he
2 helped resolve this NSC initiative that we would
3 certainly turn to him on counterterrorism. Now whether
4 Mr. Casey was really serious in this, I don't know, but
5 that was the idea.
6 I was to, and the idea was conveyed to him, I
7 believe, by more than just me, that we were interested in
8 what he had to say about terrorist matters. So it became
9 sort of a habit that he would call once in a while and
10 convey to me some certain information and then, as we'
11 cane closer to the McFarlane trip Colonel North asked me
12 to contact him from time to time on specific
13 developments. ^
14 Q Why was it felt that these kind of contacts
15 could not be turned over to someone else?
16 A It could have been handled by someone «lse.
17 -Qs-- To put it another way, Mr. Ghorbanifar is
18 getting a very highly paid, higRly •killed, by government
19 standards, case officer support h«r«.
20 A Well, it took a little time to converse and
21 for him to convey some information. Then I would write
22 it up and make it available ^°|^^^^^^| ^^- <^^ve, Mr.
23 Clarridge, Colonel North, and I'd keep a copy for myself.
24 And if it were of sufficient interest I'd send a copy up
25 to the Director and Deputy Director.
uimstnED
628
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393
1 Q In terms of the decision, though, that you
2 were going to be the contact point, was that simply a
3 matter of evolution or direction by Casey?
4 A I remember Clair George talking to me one day
5 on secure. I was at the White House, and I can't
6 remember quite the topic. But he said, well, you're in
7 essence his case officer for the time being. Just stay
8 in contact with Ghorbanifar, and I did.
9 Q Let me show you a couple of memoranda, a
10 memorandum dated February 10, 1986, a February 8 and ■
11 February 9 telephone call. We're not going to spend any
12 time with them, but if you'll just identify them as bding
13 yours.
14 (The document referred to was
15 marked Allen Exhibit Number 37
16 ■ for identification.)
17 And then a February 19, 1986 memorandum on a
18 February 10 telephone call. That will be Exhibits 37 and
19 38.
20 (The document referred to was
21 marked Allen Exhibit Number 38
22 for identification.)
23 (Pause.)
24 A Those are my memos.
25 Q In terms of these conversations that you were
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394
1 having with Mr. Ghorbanifar, apart from making notes and
2 ultimately preparing a memorandum did you record those
3 conversations in any fashion?
4 A I recorded some of those conversations, and
5 . I'm not sure. I think that started in February '86.
6 Q February '8 6?
7 A Yes.
8 Q Could you tell me how you would have made
9 those recordings?
10 A With a recorder provided to ma by CIA's Office
11 of Security. J^^^^^^^^^^l made them available to ma.
12 Q
^^^^^^^1 as
14 Q And this device would have been attached to
15 what phone — your phone at the office or your phone at
16 home?
17 A Both.
18 Q Is it a portable device you just plug into the
19 telephone? Okay. And it would have generated cassettes?
20 It's not a reel-to-reel, I assume.
21 A I had a couple of cassettes that I used. I'd
22 use them over and over.
2 3 Q That's the next question. When you recorded a
24 conversation in February 1986 and did a memo, would you
25 retain the recording?
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395
1 A No, sir. I kept no master list.
2 Q So you would use the recording to prepare your
3 memorandum.
4 A Yes, sir.
5 Q And then recycle the tape. Is that what
6 happened?
7 A That's correct.
8 Q On the February 10 call just one note in
9 passing. The date of that telephone call, February 10,
10 is the date that $3.7 million came into the CIA's]
11 account. There's nothing I recollect about that being
12 mentioned in the telephone call, .^iq you Jiave any recajLl
13 of Ghorbanifar keeping you abreast of money flow during
14 this period of time?
15 A No. I learned of those either from Colonel
16 North, that they had showed up in, say, Mr. Secord's
17 account, or I learned it from the Directorate of
18 Operations that it had showed up -'^|^^^^^^^| or I
19 remember one time I think Mr. Juchniewicz mentioned it
2 0 had shown up. No, he did not talk about fund flows.
21 Q The next day, February 11, 1986, General
22 Secord is shown as having met with Director Casey at
23 Director Casey's office. Any knowledge that you had of
24 the meeting between Secord and Casey on February 11,
25
1986?
\mmm
631
1 A NO.
2 Q February 13 and 14, 1986, the Army delivered
3 its TOW missiles to the Central Intelligence Agency.
4 Were you being kept posted on the status of the TOW
5 arrangement at that time?
6 A Yes.
7 Q And this would have again been North that was
8 keeping you posted?
9 A I believe I was obtaining that from talks with
10 Operations Directorate people.
11 Q At any time —
12 A And I didn't try to keep minute following of
13 this, but I generally was aware of when the TOWs were
14 being moved and the status of their sanitization and
15 packaging.
16 Q We know that HAWK parts got talked about later
17 on in the year. Were you aware of any discussion of HAWK
18 parts at this period, January-February 1986?
19 A HAWKs. I recall HAWKs became a subject when a
20 list was prepared of 240 items and Colonel North was
21 anxious that a copy of this be made available, I believe,
22 to the Director of Operations and somehow either I picked
23 up the list that he had acquired —
24 Q I'm going to trouble you with that in a
25 moment. Most people place that in March. What I'm
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UNOtASSMD
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looking at is whether you have any recall of basically
two HAWK part situations, one occurring early in 1986,
earlier than March, and then the actual list coining in in
March of 1986.
A I don't know. I'd have to go backj
There may have beenl
:o HAWK missiles. I would not be surprised if
I found them, but I don't recall.
Q There was a mention in, was iti
interview where he mentioned the HAWK parts?
Ihad some recall of spare HAWK missiles or spare
HAWK parts.
MR. WOODCOCK: f^H^^^^H recalled two
different HAWK spare lists. He recalled one in January
of 1986 and another in March of 1986.
THE WITNESS: Please identify thel
THE WITNESS: There'
who also knew about this initiative. I know who you're
talking about. I can't recall a list in January. I know
in early March a list was provided of 240 line items by
the Iranians to Mr. Ghorbanifar, who provided it, I
guess, to the United States.
iiMf^iMH)
633
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398
1 BV MR. KERR: (Resuming)
2 Q I want to come back to this Ghorbanifar
3 raising of money — raising of the issue of money going
4 to the contras. Thus far we've talked about a reference
5 to it that occurred on January 13. There's another
6 reference of January 26 that we saw relating to the tape-
7 recorded conversation and your notes on that meeting.
8 There apparently is another reference to money
9 for the contras in a conversation that is said to have
10 occurred February 18, 1986, between yourself and Mr.
11 Ghorbanifar. That is the Tab D reference to Exhibit 27.
12 If you would look at Tab D perhaps you can ""
13 tell me first how it is that we know that that was a
14 February 18 telephone conversation.
15 A Well, as I pointed out, Mr. Rizzo did not show
16 his memorandum to me. He did not clear it with me, and I
17 did not see it until it showed up on my desk. These are
18 notes, Attachment D, these are notes that I took in
19 London on the 26th of January, 1986.
20 Q So Mr. Rizzo 's attribution of these notes to
21 February 18, 1986, is in error; is that right? The Tab D
22 reference is in the letter on the second page.
23 A That is absolutely in error and Mr. Rizzo
24 should have checked that with me before he sent the damn
2 5 memo down here.
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Q Let me come at you another way on that, Mr.
Allen, You have written notes of the January 26 meeting.
Were they collected as a group somewhere when last you
saw them, marked as your notes of the January 26 meeting?
A Were they collected and properly marked?
Properly or improperly, but at least kept
Q
together.
A
notebook.
Q
A
Q
They are in a separate notebook, sir, spiral
When last did you see that spiral notebook?'
Probably in January.
Okay. And you don't know, sitting here today
A January or February. The Inspector General
may have asked me about it in the February time frame, so
they showed it to me, but they took it away, I think.
Q You don't know today whether that notebook is
on the box I've not seen yet?
A I'll take a look at it tonight.
MS. MC GINN: Off the record.
(A discussion was held off the record.)
BY MR. KERR: (Resuming)
Q There's a reference in the Tower Commission
report to a meeting Mr. Ghorbanifar had with yourself and
Mr. Allen on the 18th of February. Do you have a
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ONKiBSIflfD
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recollection of such a meeting?
You said a meeting with Mr. Allen?
I'm sorry,
That Mr. Ghorbanifar met with me an
on 18 February 1986?
I think I've gotten that scrambled, so let me
I recall no such meeting.
You are right. My error, Mr. Allen. I
with regard to the meetings that took place in
Frank£/rt on February 20, whe^^^^^^^^^fand Mr. North
and Mr. Nir went out to meet Mr. Ghorbanifar and
apparently hoped to meet^^^^^^^^^H did you
participate in the preparation for that attempted meeting
on 20 February?
A No, I did not participate in the preparations.
I was aware the meeting was
Q Mr. Ghorbanifar apparently tried to reach you
or did reach you during that period of time. On February
23, we have a transcript of that call. This will be
Exhibit 39.
(The document referred to was
\mmB
636
401
1 marked Allen Exhibit Number 39
2 for identification.)
3 If you would look at Exhibit 39, I would like
4 you to identify it for me, if you can, as a transcript of
5 a telephone conversation that you would have had on the
6 23rd of February 1986 with Mr. Ghorbanifar.
7 (Pause.)
8 A I believe that's a conversation I had with Mr.
9 Ghorbanifar. . ^
10 Q 1%at BMBO appiiars to b« a verbatim record of
11 the conversation. Can you tell me in some instances we
12 would have had verbatim transcripts and others summaries?
13 A I guess I had more time. I probably asked my
14 secretary to do this one. I didn't — if it — I can't
15 answer that question. I don't recall.
16 ' Q As to that tape, it too went the way of the
17 others?
18 A I don't know that I have that tape. I reused
19 the tape again and again.
20 Q Mr. Ghorbanifar appears to be objecting to Mr.
21 Hakim in this telephone conversation with you. Do you
22 recollect that objection being voiced, and am I right
23 that it's Mr. Hakim that's being objected to?
24 A At the time, I wasn't certain, as you can see
25 from my conversation of the individual to whom he was
IHietA$«D
637
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1 referring, and based on my knowledge at this point it
2 appears that it was Mr. Albert Hakim.
3 Q Did you bring that issue to Colonel North's
4 attention?
5 A I don't recall. I made this available,
6 probably, to Colonel North because my secretary had a
7 very limited dissemination list for these sensitive
8 contacts.
9 Q Nonetheless, on the period February 26-27,
u
10 when the trip to Frankf/rt is made, Mr. Hakim goes on the
11 trip; isn't that right, acts as translator?
12 A On the 26th and 27th of February? I don't*
13 know.
14 Q You don't remember?
15 A I don't recall being told that Mr. Hakim was
16 there, unless there's reference in my notes somewhere to
17 this effect. I was not aware that Mr. Hakim was there as
18 a translator. It's conceivable that I was told that, but
19 I don't remember. I just frankly don't remember. I
20 thin]^Hfl^^^^|was there. Colonel North, Mr. Nir. I
21 thought Mr. Secord was there, but I don't know — Major
22 General Secord. I think Major General Secord was there.
And I believe ^^m^^^^came up.
24 Q The only thing I'm really interested in is
25 whether or not you recall any discussions with any of
UNCtJtSSIFe
638
vwssm
403
1 those folks about taking the risk of offending
2 Ghorbanifar by having Hakim join the gathering in light
3 of his concerns about Hakim.
4 A I can't recall that. The memo, I am certain,
5 was made available to some of the participants in the
6 meeting.
7 Q When the meeting broke up, which would be
8 about the 26th of February, 1986, North sent a memorandum
9 to I believe it was Admiral Poindexter saying that Mike
10 Ledeen appeared to have a financial interest in the arms
11 transfer. Was that concern on the part of Colonel North
12 about Ledeen having a financial interest in these matters
13 ever conveyed to you?
14 A What was the date of Colonel North's
15 memorandum?
16 Q It would be February 27, 1936.
17 A At that time frame I believe I had heard
18 Colonel North express concern that Ledeen was in some way
19 financially involved in the transaction, but I do not
20 recall the specifics. At that time I heard no specifics
21 on such types of financial arrangements that Mr. Ledeen
22 may have had.
23 Q All right. Do you have any further
24 recollection of what it was that Colonel North said he
25 was relying on to have these concerns or reach the
limKSSIflfD
639
immm
404
1 conclusion that Ledeen had a financial interest in the
2 transaction?
3 A At that specific time?
4 Q At or about that time.
5 A Not at that time, no, sir.
6 Q Did there come a time when you learned the
7 basis for Colonel North's view that Ledeen had such an
8 interest?
9 A Not Colonel North's view. Mr. Nir, when he
10 was in Washington in September 1986, cane to the Agency
11 to meet on a variety of counterterrorism developments^
12 and I recall walking him out to the front entrance and he
13 stated that it was his belief that Mr. Ledeen had a
14 financial interest still in the transactions involving
15 the United States and Mr. Ghorbanifar, and he made some
16 statement to this effect.
17 Q Did you ever have occasion at any time to talk
18 to Mr. Ledeen about whether or not he had such an
19 interest?
20 A He called me after the Tower Commission report
21 was published and vehemently denied it.
22 Q Other than that conversation, post-Tower
23 Commission report, you had had no conversations with Mr.
24 Ledeen about this matter; is that correct?
25 A Not that I recall. To make the record full, I
HNWstffin
640
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405
1 did convey w at Mr. Nir had told me in September to
2 Colonel Nortn.
3 Q Yes, sir. Thank you.
4 With regard to the trip that was made by
5 Colonel North ,^^^^^^^^| and Mr. Cave to Paris on March
6 7 and 8, 1986, what role, if any, did you have in
7 preparing them for that trip?
8 A Mr. Cave had come by on March 5. That's when
9 he was first briefed on this sensitive White House
10 initiative. H^^^^^^^^ Stbught him over, Z believe, to
11 ay office ant^A^ated ^ was inj^i^ant for mmr^ brief Mr.
12 Cave on everything th^^ltcA^ tr£hspir«d to^ipte. It wa"^
13 also important "that^ Mr. Cave b# shown!
14 Z had known. &at Mr. Canre was coming aboard, at least was
15 coming to atsfBL ot^^^^ Sftg*u«<^^^^^^^^Bhad —#-
16 cooMAtSlFi,!! .^p^'^bruary time frame, because we were
17 trying to have lunch about once a week, that he felt it
18 was important to put someone full time on who was an
19 experienced Iranian specialist and Farsi speaker, and I
2 0 certainly agreed v^^ih that.
21 So I prepared Mr. Cave as best as I could on
22 what I knew about the activities to date.
23 Q With regard to the March 7 meeting, March 7
24 and 8 meeting, did you have discussions with North and/or
25 Cave and/or^^^^^Kifter they returned about what
IINCEHSStFfFn
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transpired at that meeting?
A Yes. I talked certainly with Mr. Cave. I
also talked with^^^^^^^^H who expressed optimism that
^^^^^^^^^Hwas indeed a powerful individual reporting
directly to the Prime Minister, and I recal]
having some optimism that the initiative would succeed.
He said this man,^^^^^^^^^^K can make
decisions,
|he's tough and h«
can get things done.
MR. WOODCOCK: I gather he didn't mention »t
that point that he had also met with —
THE WITNESS: That came in the May time frame
and Mr. Cave cited it to me numerous times. George has a
way with words at times.
BY MR. KERR: (Resuming)
Q Mr. Allen, you testified a little bit earlier
that you had seen Mr. Cave's memorandum of what occurred
at the March meeting.
A Yes, sir.
Q Let me show you Mr. Cave's memorandum of that
meeting which I'd like to have marked as Exhibit 40.
(The document referred to was
marked Allen Exhibit Number 40
^rI
642
UNCIASSMD
407
1 for identification.)
2 If you'd look at Exhibit 40, I'd like you to
3 tell me if that is the Cave memorandum following the
4 early March meeting.
5 (Pause.)
6 A I've read the memorandum. Mr. Cave probably
7 put it together over in my office.
8 Q And you would have read it in early March, I
9 take it, the first couple of weeks of March?
10 A Yes, sir, I would have read it as soon as it
11 was typed, as soon as copies were made.
12 Q And this memorandum is the memorandum that ~
13 does in its conclusion make reference to funds for
14 Nicaragua; isn't that correct?
15 A That's in the final paragraph, sir.
16 Q Right, the paragraph that says: He — being
17 Ghorbanifar — also proposed that we use profits from
these deals others to fund ^^^^^^^^^^^^^^^^^^^M
19 ^^^^^^^^^H We could do the same with Nicaragua.
20 Now, as I understood what you told us a little
21 bit ago while you read that, that did not make any .
22 significant impact upon you; is that correct?
23 A That's correct. And after the Inspector
24 General's staff raised this with me when they were doing
25 their investigations, I went back, I believe, and read
wmmm
643
*4SS/f/ffl
408
1 the memorandum again, and I don't know that it helped my
2 memory all that much. I may have vaguely recalled a
3 reference to this in the memorandum.
4 Q And sitting here today you have no recall of
5 having discussed this matter with Mr. Cave?
6 A No, sir.
7 Q Have you and Mr. Cave had occasion within the
8 last several months to discuss this memorandum and
9 compare recollections on whether or not there was
10 discussion on this point between the two of you?
11 A After the Inspector General had raised this
12 memorandum of Mr. Cave and after I had looked in my no'tes
13 of my meetings with Ghorbanifar, I mentioned to Mr. Cave
14 that there had been a couple of passing references by
15 Ghorbanifar to the same matter but that I had forgotten
16 it. We did not at that stage recall ever having
17 discussed this memorandum that Mr. Cave prepared as to
18 the final reference to Ghorbanifar and profits.
19 Q In a word, he had no further recollection of
20 having had discussions on this item with you any more
21 than you did, is that correct, given what he told you?
22 A Yes. I think we both commented that, you
23 know, Ghorbanifar was wont to make these kind of sort of
24 sweeping statements and we paid little heed to them.
25 Q There are a series of conversations that you
wmmn
644
409
1 apparently had with Mr. Ghorbanifar and, from time to
2 time, Mr. Nir in March, including conversations relating
3 to his apparently being in financial difficulty. I want
4 to run those memos by you quickly.
5 Let me show you a series of memoranda which I think
6 we'll just mark collectively: Memorandum dated March 9;
7 call dated March 11, 1986; a memorandum of a March 20
8 call dated March 21, 1986; memorandum of a March 24 call
9 dated March 24, 1986; memorandum of March 28 call dated,
10 excuse me, March 27 call dated March 28, 1986; another'
11 March 27 call dated March 28, 1986; yet another dated
12 March 28 on a memo dated March 30, 1986; another on Match
13 28 dated April 2; and March 30 a memo dated April 7,
14 198 6; and March 31, and that one's dated April 2, 1986.
15 Let's mark it collectively as Exhibit 41.
16 (The document referred to was
17 marked Allen Exhibit Number 41
18 for identification.)
19 Mr. Allen, all I need to do is essentially
20 have you flip through them and tell me if they are your
21 memos of those conversations. Let me add two more to the
22 list — a March 17 telephone call and March 18 memo, and
23 a March 11 call and a March 12 memo. I think that does
24 March.
25 (Pause.)
imraswn
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umssifiED
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A Those are my memoranda.
Q With regard to what's related in thosa
memoranda, by the time we get to late March, March 24,
1986, there's an indication in the memorandum that
Ghorbanifar is in financial difficulty and that Mr. Nir
is supporting Ghorbanifar. Apart from what the memoranda
themselves say, what did you know about the nature of
Ghorbanifar' s financial difficulty and the nature of the
support he was getting from Nir?
A
Other than that, I have no specific
knowledge of Mr. GhorbanfiEi^s financial troubles, except
what Mr. Nir had asserted, that he had to go into, I
believe, his wife's account in order to cover some of the
cost, I
land that Ghorbanifar was helpinc
I have no specifics except what's in these
memoranda on what Mr. Nir and the Israelis were doing for
Mr. Ghorbanifar. So I can't offer any further
enlightenment. It's the first time we had any evidence
IfW^imiftrn
646
411
1 that Mr. Ghorbanifar was beginning to suffer financial
2 problems.
3 Q But in terms of how Nir or how Israel was
4 helping Ghorbanifar, you didn't get any flesh on those
5 bones? You didn't know what they were doing?
6 A I've dealt with the Israelis and they don't
7 give you much flesh on bones.
8 Q Do you have a notion of whether it was
9 business transactions or a loan or they put him on
10 salary? None of that? You do»*t know?"
11 A I don't know, Mr. Nir in essenc^-iifaS^cting
12 as Ghorbanifar 's case officer on a day-to-day basis.
13 Q The March 27, 1986, telephone conversation is
14 from an unnamed NSC person. Was that Micha*l. Ledeen that
15 you were talking to?
16 A That was Mr. Ledeen. ^^'- .' ''"^
17 ~$ Q 'Sv^^^&ripwii^Miig^i ;-^-^^pgx,«^Mm ^^^^^1 ^n?
18 you in Usance that Ghorbanifar was mMa at the CZA; is
19 that right?
20 A Precisely.
21 Q Now why was he unhappy about the Central
22 Intelligence Agency?
23 A tB^^ he-tad h«*rd from his friend in
24 California, who said that her apartment had been entered.
25 He also conveyed that a man named Furmark — and I did
UNEtiHSStFtED
647
412
1 not know how to spell Furmark at that stage — a business
2 associate in New York had had his office entered as well,
3 and Mr. Ghorbanifar suspected the Central Intelligence
4 Agency .
5 Also, Mr. Ledeen, as I point out here, stated
6 that we were not assisting him in his work in the area of
7 counterterrorism. So I only recorded what Mr. Ledeen
8 conveyed to me. As I have indicated, my role was to
9 string Mr. Ghorbanifar along on the issue of terrorism,
10 keeping him focused on the principal matter. Those were
11 the instructions of Mr. Casey and I carried out Mr.
12 Casey's instructions, I think, very faithfully.
13 Q In terms of Ghorbanifar 's relationship with
14 Furmark, any elaboration on that at that point?
15 A I never even researched the Furmark aspect. I
16 don't kn^^wSy I didn 'tg^I vi»j&."-r ha^^
17 ^ -Q~ ,^o yj^ di^Kt raise FurBnBi* a^^fin^^^^a^Ay
18 and you didn't do any kind of tracing to see who this
19 Furmark character was at that time?
20 A No, sir.
21 Q You would have circulated this memo, correct?
22 A Yes, sir.
23 Q Would you have circulated it to Mr. Casey?
24 A I don't know.
25 Q All right.
UNWStFIED
648
m
413
1 A Certainly the Deputy Chief of NE would have
2 obtained it, and Mr. Cave, and Colonel North and people
3 of that nature, because^^^|HH|H came over and
4 discussed the alleged entering of the girlfriend's
5 apartment in California. I remember him mentioning that
6 to me.
7 Q Why was that of interest tq
8 A I don't know.
9 Q There was no CIA involvement in that action, I
10 trust. — ^ -fc
11 A Not to my knowledge. I don't think that that
12 occurred as fa^p^B CIA is concerned.
13 Q Did you then or do you now have any knowledge
14 of who might have been entering one or both of those
15 locations apart from common thieves?
16 A I have no evidence. I have no knowledge.
17 Q Did Mr. Furmark ever talk to you about the
18 entry into his office at this period of time?
19 A No.
20 Q Which is another way of saying you never had
21 occasion to talk with him in which he indicated that
22 there was no theft of money or goods but documents
23 appeared to be missing as a result of this entry, not
24 because it says it in the memo but because you have talk
25 to Furmark? Furmark never told you about this entry in
mmrn
649
BfMSIflEO
414
1 any respect, I take it.
2 A No, sir. And when I met Mr. Fumark in
3 October '86 I had not connected him with this memorandum
4 at all and had forgotten the name Furmark had been
5 recorded in such a memo.
6 Q When we come to March 28, just reading the
7 memorandum it seems to me that Ghorbanifar was still a
8 bit on a raw edge and that you were given the job of
9 sorts of trying to calm him down; is that right? Was one
10 of your functions to kind of smooth down Mr.
11 Ghorbanifar 's feathers at that point?
12 A Yes, sir. '
13 Q And Z take it one of his grievances by March
14 28 is he is right upset that Hakim has approached
^^^^^^^H^nd suggested that^H^^^Hdo business without
16 going through Hakim; is that right? I'm sorry, without
17 going through Ghorbanifar.
18 A Mr. Nir told Mr. North that Ghorbanifar was
19 outraged and was a problem, and Z recall it was on a
20 Friday evening, I believe. I had just delivered my
21 Hostage Location Task Force report to the White House and
22 I was paged twice going over the Woodrow Wilson Bridge by
23 Colonel North. I don't know how he did it twice in the
24 span of a bridge, but he did.
25 I had, I guess, my mobile telephone with me,
DNtWIEn
650
415
1 and I called Colonel North, and he said as soon as I
2 arrived home call Ghorbanifar and try to give him some
3 assurances and invite him to the United States
4 immediately.
5 Q Can you tell me how it came to pass that Hakim
6 made this run ^^hII^^HI ^^^ this something that was
7 discussed?
8 A It was discussed, but the decision was not
9 made when I was around. Mr. Cave probably could convey
10 more direct information on that. Z prefer not to.
11 Q Do you recall playing a role in the decision
12 to have Hakim make this —
13 A No, sir. I did not play any role in that. I
14 did talk to Mr. Cave that I felt it was a mistake to try
15 to bypass Mr. Ghorbanifar, that Mr. Ghorbanifar knew too
16 much and could make us pay dearly at thac stage if we
17 went directly into^^^^^H and I think Mr. Cave, after
18 reflection, agreed with me.
19 Q Gotcha.
20 (A brief recess was taken.)
21 BY MR. KERR: (Resuming)
22 Q In any event, the way that the ruffled
23 feathers of Ghorbanifar were handled was that Colonel
24 North suggested to you that you contact Ghorbanifar and
25 suggest that he come in on the double-quick for a meeting
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UNGLASSm
416
in Washington, D. C; is that right?
A Yes. That was what occurred.
Q And, as I understand the traffic here, you
even agreed to pick up Mr. Ghorbanifar at the airport.
A Which I did, along with Mr. Cave.
^^I^^^^^^^^^^^^^^HHlHi the
meeting, which would have been April 3-4?
A Yes. He arrived on April 3 and stayed until
the 4th and then left for California to visit his
girlfrier
I paid the bill,
actually paid the bill and gave it to
I believe.
Needless to say, Colonel North was not happy.
Q With regard to what occurred on April 3-4, can
you give me a summary ojt the meetings that you attended
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417
and the discussions that were had?
A The only meeting I attended was we picked him
up at the airport when he arrived on the Concorde and
took him to his room where I had made reservations, at
the Ramada Renaissance Hotel near Dulles Airport, and we
had lunch. And then in the evening Colonel North, I
believe,^^^^^^^^^ and Mr. Cave met with him. I
believe there was another meeting involving mayb^^^B
Mr. Cave, and Mr. Ghorbanifar in the afternoon
on the 4th just before Mr. Ghorbanifar left.
Mr. Ghorbanifar called and told me he was
leaving early and that was when I alertedH|HH^^H and
Colonel North and Mr. Cave to this, and Mr. Cave and^^^J
ll believe, went immediately to see him for a few
moments before he left for California.
Q It's apparently at about this time, April 4,
that Colonel North prepares the draft memorandum which
attracted the attention in the Tower Commission report
which does reference diverting money to the contras. Did
you have any information at all in early April that such
an operation was at work on the Iranian initiative?
A None whatsoever, sir.- »! knew nothing about
that, knew nothing aQjeut the memorandum that was being
■iNCmStFIED
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prepared by Colonel North.
Q With regard to the HAWK missile parts, the
list for which had come into the possession of the Agency
in early March, did you have any involvement in the
efforts to obtain prices for the parts, any role in that
at all?
Q With regard to negotiating a price, if you
will, that th« Xzanianfi, w«r« to pay^ f or thesa goods, did
you haw any understanding of how that process was
worlcing and who was working it?
A It was my understanding in discussions with
Mr. Cave and with Colonel North that Mr. Ghorbanifar was,
as had been understood, was trying to find financing in
order to finance the cost of HAWK missiles, and I think a
certain number of TOW missiles, which would sort of come
together with a perhaps a concurrent visit by senior
officials like Mr. McFarlane to Tehran.
So I was aware that Mr. Ghorbanifar was having
"wpfwmrn
654
WMMli
419
1 trouble or allegedly was having trouble raising funds,
2
3
4 Q Let me focus on that, though. In/T terms of
5 what the CIA needed to know, it needed to )cnow that it
6 had enough money to cover whatever it was paying DOD?
7 A That's correct.
8 Q But taking it the next step, what it was
9 Ghorbanifar was joing to pay for th^jjf |)art8, whatf ^=-
10 understanding did y^rhav* as of April as to who was '
11 responsible for giving a price to Ghorbanifar for hin to
12 pay?
13 A It was my understanding as far as the price
14 that would be given to Ghorbanifar this would be
15 something that the NSC, working with U.S. intermediaries
16 like Major General Secord, would provide a price to Mr.
17 Ghorbanifar.
18 Q In terms of individuals, though, did you have
19 a perception of whose role that would be — Ollie North
20 as opposed to someone else? Do you get my drift?
21 Somebody had to actually talk —
22 A Who came to the final price which we would
23 submit to the Iranian intermediary, who was arranging the
24 financing? It was my impression — and I don't think I
25 ever discussed it in detail — but the NSC would present
•iRimsinED
655
UNCtASSIflED
420
1 a price to the Iranian intermediary and say you will have
2 to finance this amount of money.
3 Q When you use the term "NSC" , who are you
4 referring to?
5 A Well, Colonel North was the focal point for
6 this activity.
7 Q Was it your assumption that Colonel North
8 would be the one to reach that price agreement with
9 Ghorbanifar?
10 A I don't think I ever thought it through vefy
11 specifically, but it was my feeling that because Major
12 General Secord was involved that there would be a prioe
13 that he would want out of this for transporting the arms
14 and that perhaps by then I believe I understood that a
15 man named Hakim was also involved with Major General
16 ' Secord, thajt there wouM.-bc — "^WP — ^^"^ -° ^ price
17 whi^^t^ v^l 1 d-jIB^glr tBgfeatanattoiife-nrtri^ll^ vo!^d cover
18 all the costa^^ '-- '"^ "• ~' ^
19 Q Were you conscious of the fact that the CIA
20 personnel apparently were bein? excluded from that
21 negotiation?
22 A Yes, sir. All we knew was we would submit a
23 bill and say you have to have X number of dollars in a
24 CIA account before we do anything, and all we did, as
25 I've explained earlier and as you know, was handle the
'iMfittSStRED
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UimMSIFliD
421
bill. Wa were excluded from the overall pricing process.
Q Did you have an understanding as to why you
were excluded from the overall pricing process?
A Well, again we felt we were a support activity
and an intelligence collection support mechanism and that
this was an NSC-Presidentially-approved initiative. It
was apparent that we were not co be included in those
types of final decisionmaking on the pricing.
Q Did there ever coma a point in time whan that
was actually explained or North took that position?
A Ko, sir, not to my recollection.
Q Kot to you anyway?
A Not to me.
Q The Tower Commission report indicates that
Ghorbanifar was arrested on April 22 as a result of
aspects of an American criminal investigation. Did you
have knowladga of Ghorbanifar being arrested in lata
April?
A
he had been arrested by
Swiss police because of work that was — because of
activities with Cyrus Hashemi.
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UNCLASSIffiD
422
So Mr. Cave and I discussed it.
Q Now when the Cyrus Hashemi point came up in
connection with the arrest of Ghorbanifar, did anyone
that you were talking with recall the role of Cyrus
Hashemi back in June and July of 1985 in bringing forward
Ghorbanifar initiative at that point in
No.
You yourself had no awareness?
You're talle%ig about —
Let me take you back. June 17 Casey %et« a.
call from John Shaheeh mentioi^i? Cyrus Hashemi. Cyrus
wants a nolle pros, all that good ««uff.
A Yes, X recall. No, no one raised that
subject, 1^ the beat of m; recollection, certainly not
with JM. 1 cert^nly remeaber talking to^-^asey abouls^he
arrest ot ahorbshifar Wnd alseT discussed it with
Colonel North, that he had been held for 24 hours but
then released by the Swiss police.
Q Did you ever have occasion to discuss that
with Ghorbanifar — the arrest?
A No.
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H-ASSIRED
423
Q Did there ever come a time when he actually
admitted to you he had been arrested?
A I don't recall. I don't think he mentioned
it. I know that Mr. Nir became aware of his arrest
because Mr. Nir mentioned it to me, that Ghorbanifar had
discussed his arrest and Ghorbanifar had protested his
innocence to Mr. Nir.
Q With regard to that arrest, did that give rise
to concerns about the security of this operation at that
time?
A No, not to my knowledge. This was a separate
activity. It was viewed as Mr. Ghorbanifar perhaps being
involved in another financial
It appeared that he had other deals under
way with a variety of elements. So the fact that he
might have been involved in some form of arms transaction
with Cyrus Hashemi certainly was not beyond question and
we were not surprised.
Q Was any effort made at that time to contact
other law enforcement services of the United States to
determine if they in fact had intentions of proceeding
against Ghorbanifar?
A I think, as I recall, that Colonel North
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obtained a list of all those individuals who had been
arrested in that sting operation, and I don't believe Mr.
Ghorbanifar's name appeared on it.
Q May 6, 198 6, Colonel North and Mr. Cave met
with Mr. Ghorbanifar in London. Did you have any role in
preparing Cave and North for that trip?
A No. I saw it as a preparatory trip perhaps to
work out final arrangements relating to a senior level
visit!
land occasionally during these
meetings with Mr. Ghorbanifar ^nd^^^^^H^^^I or when
the second channel was opened Mr. Cave would call me Co
provide me with what one would call tip-offs
Q North apparently came back to the States about
May 8. Did you participate in any debriefing of Colonel
North on the London meeting?
A I don't recall what I did. I'm certain I
talked to him on the secure telephone each time he
returned. There were always occasions to discuss a
variety of matters, so I'm sure that at soma point he may
have discussed it with me.
Q Do you recall that this meeting of the 6th,
7th, 8th of May, that period of time, had to do with
assuring that there would be financing for this
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transaction?
A That was my understanding, that that was a
meeting to ensure, to see what the final arrangements
were relating to the financing for the movement of HAWKs
and perhaps TOW missiles.
Q What aspect of financing was, to the best of
your knowledge, discussed at that meeting — in other
words, whose f inane ing^it^was|_here?
A I don't know. And if there's a memorandum
that details that, I don't know of that either.
Q Unfortunately, neither do I. Did it come to
your attention in this first two weeks of May how mucfl
Ghorbanifar and his confederates were going to be putting
up?
A I don't think I knew th« amount that they were
having to financ
Q But let me set that aside for a moment. In
terms of what he and whoever his investors were, we now
know Khashoggi, but in any event did you know during that
period of time how much they were going to be paying?
No.
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Q You did not?
A To the best of my knowledge I didn't )cnow at
all.
Q It appears that Khashoggi made his
contribution and that a S15 million deposit was placed in
a Lake Resources account about May 14, 1986. You had no
contemporaneous knowledge of the amount Khashoggi was
paying into Secord's account; is that correct?
A No, sir, I did not.
Q You did know, I assume, that two days later.
May 16, $6.5 million was put by Secord into CIA's
account? -
A I thought it was on the 15th of May. Yes, I
did know that the money had moved into the CIA account.
Q But in terms of a difference between what had
gone into Secord's account and what had come out to the
CIA, you war* not conscious of that at the time?
A I had no understanding of that figure, that
total figure.
Q With regard to the May trip, if you could give
me an overview description of the role you played in
preparation f°i^^^^^^^^B^^^^^|^^* trip.
A Well, this became an extremely high priority
after the meeting occurred, I guess, in Londor
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Q With regard to the trip itself were you
monitoring events in Tehran as they occurred?
A
and there was a little command post set up in the Near
East division and staffed around the cloc}c by a variety
of officers. Also, Colonel Earl and, I believe, from
time to time Commander Coy at the White House managed a
small command post in the NSC in Room 302.
"^wntSSIREfl
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(INCLASSn
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1 I maintained my own command post, with
2 occasional help from|^^^^^^^BIH| I didn't sleep much
3 for those days.
4 Q During the course of the trip did it come to
5 . your attention that the $24.5 million figure as the price
6 of the goods had come up and been brought to Cave and
7 North's attention?
8 AX recall upon the return preparation of a
9 memorandum by Mr. Cave, and I don't have the memorandum
10 in front of me, but there was a memorandum where X
11 believe Mr. Cave talked about pricing and the fact that
12 there were concerns for pricing. '
13 Q You would have had a debriefing session of
14 some sort, I assume, with Mr. Cave when he returned?
15 A Mr. Cave, as soon as he returned, he and I
16 went to see Mr. Casey, I think. I think Mr. Cave saw Mr.
17 Casey almost straight away and I sat in the meeting.
18 Q During the course of that meeting with Mr.
19 Casey was this pricing aspect discussed with Mr. Casey?
20 A I don't remember. I'm sorry, I just can't
21 recall. Generally it was a conversation where we were
22 disappointed there was no resolution, and I believe Mr.
23 Cave also talked to Mr. Casey about the fact that
24 ^^^■^^■came to the airplane and asked to stay in touch
25 directly with Mr. Cave, that he wanted to see this
II
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1 initiative continue.
2 Q Let me focus again, though, on the pricing
3 piece of it. Mr. Cave has related to us a concern that
4 the $24.5 million figure was put out by Ghorbanifar.
5 They were told — that is. Cave was told that if the
6 Iranian officials asked about the $24.5 million figure he
7 was to say it was okay, and he has told us that he was
8 concerned about that price, that Colonel North was
9 concerned about that price.
10 There was a discussionj*ith NffT^which wasn't
11 terribly enlightening, ab<»ut why that price was arrived
12 at. Nit^jthat as. kind of a Imd-in^can you tell me v/hat
13 you knew about that pricing situation within the days
14 that followed the trip to Tehran?
15 A Not a great deal in addition to that. Mr.
16 Cave did discuss with me the pricing, the fact that a
17 couple of million may have been added to the price to
18 cover a $1.7 million debt that Mr. Nir owed for some
19 obscure reason that I still do not know the reason for,
20 that it was $24 million, that this seemed to be
21 relatively high considering the quantities of the weapons
22 and spare parts.
23 I didn't focus in any great depth on it. It
24 appeared that this was a problem at that time, although I
25 certainly began to focus on the pricing around 20 June
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and then throughout Julj
[But at that stage, not knowing
what price the NSC had provided to the Iranian
intermediary, it was very difficult for us to discern —
Mr. Cave and I — what the differential was between this
$24.5 million and what was actually being charged Mr.
Ghorbanifar and his financiers.
In any event, it was a hefty price, and I
recall being extremely annoyed that it looked like Mr.
Ghorbanifar was charging a very exorbitant price.
Q Do you recall taking that up with North and
asking Colonel North what was going on here with the ~
price?
A Not at that stage. I certainly took it up
later on ^^H^^^^^^^^^^l^^^^^^^^^^'^^ ^^^ more
started looking at that, the more confused I became.
Q Did you ever, up through the end of the trip,
have a conversation witlj^^B^^^HS in whict^^M^^^H
described to you what was happening at the cost side, if
you will — his activities — to make sure the costs were
kept down?
^^^^^^^^1 during the — I guess
don't understand your question.
Q Let me take you back to the TOWs, back in the
beginning of '86. Did you ever have a conversation with
umssiffti)
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1 ^^^^^^^^^H^" which he outlined for you how the decision
2 had been made to go get obsolete TOW missiles so that the
3 price per missile would be substantially reduced from
4 what that price would otherwise have been for an on-the-
5 shelf, non-obsolete missile?
6 A I knew we were giving the older version of the
7 TOW missile and that we were doing this deliberately. It
8 was explained by Colonel North, who said we didn't want
9 to give them the highest quality TOW missile.
10 Q Do you ever recall a discussion wit^
11 where it became apparent to you that the reason for the
12 type of missiles that were being sought here was not
13 because you didn't want to give inferior goods but
14 because of the price?
15 AX don't recall a conversation with
16 on that.
17 -rq^^^All-
18 A I'D not saying it couldn't have happened, but
19 Z don't r*call it.
20 Q You did not know of the conversations that
21 were had with General Russo, for example?
22 A Ko, sir. I didn't get involved. That was
23 what I considered very much a ^^^^Hlogistical work. At
24 that stage I didn't get involved. I was a little more
25 aware in the fal]tpf,'^6 on individual pricing.
667
432
1 Q Let me move you to the HAWK parts, then. With
2 regard to the 240 or whatever they were HAWK parts, did
3 you become aware of a budget that the folks in Operations
-•^ — they were trying to
5 meet — i.e., that they could not exceed — for the price
6 of these HAWK parts that they would pay DOD?
7 A I think they were given some sort of quota,
8 but I didn't have the details on that.
9 Q Who gave it to them?
10 AX don't recall. I assume it was the NSC arid
11 Colonel North.
12 Q Do you have any recollection of a meeting err
13 an occasion where that actually occurred, where it was
14 said you can't go past $4.7 million,^^^^ Get me some
15 more budget parts. Nothing like that?
16 A I don't recall that, and I'm sure I didn't
17 participate in such a discussion.
18 Q Would you have been conscious of an intention,
19 an effort on the part of North, carried out by^^^^^
2 0 and company, to maintain a spread, to keep the price
21 down, to make sure that there was a fund to slush in this
22 transaction?
23 A No, sir. I'm not aware of that whatsoever.
24 All I know is that it was clear that Colonel North wanted
25 older missiles, the oldest in the inventory possible.
"limSSIFlEO
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433
1 But the pricing, I didn't focus on that. I didn't have
2 time.
3 Q In terms of a conscious perception, though,
4 you were not aware — I think you've answered the
5 question, but you were not aware of an effort to try to
6 make sure there was a money gap between what was being
7 paid and what had to be paid to DOD to try to create that
8 kind of fund?
9 A No, sir. I was not aware of that.
10 (A brief recess was taken.)
H BY MR. KERR: (R«auming)
12 Q ' Let me come back to the theme of ransom and
13 hostages. Apparently at a meeting between the Director
14 and Admiral Poindexter on June 5 that topic came up and
15 the figure $10 million as a ransom figure for the
16 American hostages was raised and discussed.
17 Were you aware in early June of such
18 discussions within the Administration?
19 A That's a familiar statement, but I cannot
20 pinpoint it unless I have something to have specific
21 reference.
22 Q I'll show you a memorandum for the record by
23 Mr. Gates dated 8 June 1986. Paragraph 4 is the
24 paragraph of interest. That's Exhibit 42.
25 (The document referred to was
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marked Allen Exhibit Number 42
for identification.)
(Pause. )
A I don't know. Somehow that $10 million figure
rings a bell. It's something the Director said to me
about that time frame, but for the life of me I can't
remember where that $10 million figure came from. I
remember discussing with the Director the intelligence
Q The note makes reference to a policy question
on whether or not the Administration, given articulated
policy, was prepared to pay ransom. Did that question
get resolved and brought to your attention on whether or
not the Administration was in fact prepared to arrange
for ransom to be paid?
A It's my understanding, based on all the
meetings I attended as part of the interdepartmental
group on terrorism, which I still remain a member of, and
the Operations Subgroup of the Terrorist Incident Working
Group, that this Administration could not tolerate this
kind of concept and in fact coming out of the vice
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President's Report on Combatting Terrorism one of the
issues of continuing interest was to have the Department
of Justice review ransom insurance that even private
corporations carry for high risk areas in order to ransom
potential employees who become hostages.
So I think it was a fairly clear policy.
Q What I'm driving at is the $10 million figure,
however it came up or whatever the circumstances, was it
your impression that^that was being thought through as an
option, a potential change in policy?
A No, I don't think so. I think that the
Director, as I remember, there must have been something,
a private resource or another country was prepared to do
something along these lines. And if it comes back to me
I certainly will convey this. But it's certainly a
familiar figure for some reason.
Q All right. Thank you.
Let's move to the pricing problems in June.
You've testified that you became aware that the pricing
problem had indeed become a problem of some moment by
Juna, particularly as it moves into late June. Can you
tell me what you knew and when you knew it and what the
problem was?
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IS
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stated he had
a microfiche dated 1985 which gave the base price of all
these items, and he is being charged five and six times
the amount that was reasonable for the cost of these.
I think he said he himself was not so
concerned but that clearly other officials involved in
this transaction in Tehran were, and he would not agree
to pay the funds, rt Was clear, I know, that Colonel
North gave instructions to Mr. Nir to tell Mr.
Ghorbanifar that the reason for the costs were that these
were one-time items manufactured years ago and very
costly to remanufacture, and we had to get some of them
out of current stocks.
We had to go overseas to retrieve some from
countries which had HAWK missile
I raised, I know, on on* or
more occasions about this impasse over funding, that it
was creating a very, very difficult situation and was
endangering resolution of the hostage situation.
And Colonel North insisted that we had to
pursue this very hard and he wanted anyone talking with
j^^H^^^such as Mr. Cave, I believe, to be very
resolute that this was a legitimate price. And he
HNniiOTni
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437
1 constantly —
2 Q Let ma stop you. How on earth can you be
3 resolute that something is a legitimate price when you
4 don't know what the price is? I mean, apparently nobody
asked^^^^HHH^^^^H what you pay for
6 these goods? why not?
7 A Apparently no one asJced.
8 Q Ask^^^^^Hwhat are you paying for these
9 goods? Did you all ask him how much he paid for these
10 goods?
A B^I^H^Hr'^^ ^^* °"* that was refusing to
12 pay the amounts. ^.
13 Q Maybe I haven't articulated correctly.
14 A On July 21 he finally sent $4 million to pay
15 for the HAWK spare missiles that had been taken off the
16 • aircraft in May.
17 Q Let ma try to articulate it a different way.
18 In June, when he's saying Z have a microficha and the
19 goods cost —
20 A I'm not sura when he first mentioned the
21 microfiche. It may be in July.
22 Q I can show you a tape June 30 where he talks
23 about the microfiche six times. In any event, June 30
24 we've got him describing the fact that ha has the price
25 list. What is missing from the conversation is George
II
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438
1 Cave asking^^^^^^^^Hall right, what it is you were
2 going to be charged Cor these goods.
3 I'm just curious about that. The guy's
4 complaining about a price. Why wasn't he asked what it
5 was he was being charged?
6 A You'll have to ask Mr. Cave because he was
7 handling this telephone call at the direction, detailed
8 direction, of Colonel North. I recall that he made this
9 conversation, that he made this call tc
10 Why didn't he ask^^^^^^^^^Hwhat he was really being
11 charged?
12 Q What price was being quoted?
13 A I don't know. I cannot answer that.
14 Q Let me put a context here, Mr. Allen, because
15 I find it inexplicable. You've got a situation here
16 where you've got the buyer IH^^^^H saying he's being
17 beaten to the tune of four to six times the going rate.
18 You all know what it was you were going to charge for
19 these parts. You know the parts are about $4.7 million.
20 In order to assess whether or not there has been
21 something that went awry, one clear bit of information
22 that you need to know is what is it that^^^^^^^is
23 being charged for these.
24 A I thought the cost to the Agency was $6.7
25 million.
82-688 0-88-23
674
439
1 Q It depends on what you are adding in. If you
2 add in the TOW missiles, you bring it up.
3 But, in any event, it certainly isn't $24.5
4 million.
5 A Mr. Cave and I discussed that and I thought
6 about it quite deeply during the July time frame.
7 Q My point, very simply, is that you all knew
8 what it was that DOD was going to charge you for the
9 whole wad of goods. You knew exactly what that price
10 was. What I don't understand is why you — and you're'
11 talking to Ghorbanifar during this period of time, Cave
12 when he's talking ^°^^^^^^| — vhy don't you ask what
13 it was that Ghorbanifar was charging so at least you
14 could know what the ball park is?
15 A I think I talked to Ghorbanifar perhaps once
16 about the pricing. You recall I have some handwritten
17 notes where he said I'm only charging a 60 percent
18 premium and this is insane.
19 Q Hang on. What I'm trying to drive at is you
20 had other conversations with Ghorbanifar during this
21 period of time. Ghorbanifar loves to talk to you, Mr.
22 Allen, and that is clear.
23 A I don't recall how many times he talked to me.
24 Q You could have asked him on the occasions
25 there.
UNCUtSStFI!])
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UNCIASSIEIED
440
1 A I could have asked him.
2 Q Okay. Why not? Why not unravel this thing by
3 simply asking him, Merchant, what is the price tag you
4 are putting on the goods? You know, why not tell him
5 that?
6 A That's a good question. I don't think that I
7 ever put it quite that way, but reading what Mr. Cave
8 derived from this conversation witl;
^^^^^^^^^^^^^^^^^^fl knew something was
10 particularly when Colonel North wanted perhaps to create
11 a new prie«, lirt.
12 Q Exactly. That's where really I lose this "
13 thing.
14 A And that bothered me very deeply, sir, because
15 that was about the August time frame when this was
16 occurring, and that's when I talked to Mr. Kerr in late
17 August, according to my recollection ~ Mr. Kerr cannot
18 give a precise time frame on it — where I said maybe
19 something is occurring that's really amiss.
20 Q Let's stop there for a moment because it seems
21 to me that's an inference one almost has to draw. It has
22 been described to me by a number of people, fron
23 to a number of others, and the only conclusion I can come
24 to is that North gave an instruction not to unravel the
25 pricing problem but to come up with some justification
mmm
676
441
1 for a price that wasn't accurate.
2 A For rationale, and I did not give any
3 rationale when Mr. Ghorbanifar made this impassioned call
4 in August. I simply listened and said I would convey the
5 information to Colonel North, which I did.
6 Q What did North say to you when you passed that
7 on?
8 A Well, I don't recall the specifics, but he
9 insisted again that we had to maintain the integrity of
10 our stories relating to the price, that we don't know
11 what Ghorbanifar was charging; therefore, you know, Ift's
12 just ensure — let us ensure that we all make it clear to
13 Mr. Ghorbanifar and, in the case of Mr. Cave, to]
14 that it was very difficult to obtain these parts and the
15 costs were very high.
16 So I never knew at that stage what price the
17 NSC had put on it with the intermediaries. I didn't
18 focus on the issue greatly, but by the end of August,
19 believe me, Z had started to privately focus on the issue
20 deeply.
21 Q And as you are focusing on it, take me through
22 the thought process. What is it about that second price
23 list that causes one to be a bit queasy in the stomach
24 about what's going on here?
25 A I'm "Sorry. You're going to have to explain
iweiAssffe
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442
1 the second price list.
2 Q By August a suggestion has come by Ollie North
3 that there ought to be a new price list prepared that
4 would inflate the numbers.
5 A Yes. That bothered me. I know we
6 manufactured a little card which I saw, a pink card.
7 Q Now in your own words tell me why is that
8 troublesome?
9 A Well, it seemed to me that the problem was, at
10 that stage I had come to the conclusion that — and I'm
11 talking late August — that the NSC was charging an
12 exorbitant price for these weapons and spare parts.
13 Clearly I knew that Ghorbanifar was also charging heavy
14 prices and had heard about Mr. Nir's covering $1.7
15 million.
16 But r thought there nuat hav«^^en a very
17 heavy price charged by the NSC to the financiers and the
is only thing that I could conclude, because at this stage I
19 had become aware that Mr. Hakim and Mr. Secord were
20 trying to open a second channel to Iran, Mr. Hakim and
21 Mr. Secord were directly in the middle of moving
22 equipment and military weapons to Central America,
23 logically I began to think that perhaps the additional
24 charges were being made of the Iranian middle man and
25 financiers to cover costs of supporting the contras in
UNttASSIFIEir
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443
1 Central America.
2 Q Did you take that to Ollie North? Did you ask
3 him to deal with it at that level?
4 A No, not without specifics. I said to Colonel
5 North that this impasse was really bad and it was
6 creating real problems. On September 9 I pointedly said
7 you've opened up a second channel. You've shut down the
8 first channel. And you've got creditors out there
9 yelling for SIO million, $11 million. What are we going
10 to do about it?
11 And he said something, well, maybe we'll have
12 to take it out of the reserve. That was a devastating
13 statement to me.
14 Q I was going to say, did he advise you what
15 reserve he had in mind?
16 ' A No, sir.
17 Q At this conversation on the 9th of September,
18 was anyone else present?
19 A I can't recall. Colonel Earl was in the room
20 or nearby, but I don't know that he heard that remark.
21 Q What was the occasion? Why were you meeting
22 with North?
23 A I was at the White House on another matter,
24 seeing someone else. I just stopped by and Colonel Earl
25 was in Colonel North's office, and I said where is
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UNousstfe
Colonel North. He said he is meeting with Poindexter.
Poindexter and Colonel North are discussing the Iranian
initiative.
So I just waited and Colonel North came
charging in and said to me, tell Casey]
Tell Casey that the first
channel is shut down, that the second channel is now
open, and get to him right away. That's when the
conversation occurred.
I put that in a memorandum to Mr. Casey, which
you have. I also called him as soon as I returned to the
Agencv
Q And on the point of the reserve, did you raise
that point orally with Casey or anyone else?
A Not at that stage.
Q Not at that stage? Why not?
A Well, I had already — t believe I was
worrying over this situation. I had mentioned this
issue, I think in the late August or early September time
frame, with Mr. Kerr. Mr. Kerr has difficulty putting a
precise time frame on that, and I respect him for that.
I have difficulty putting all this into
precise time frames. I know talking to Mr. Kerr, saying
that the fallout could be very devastating and Mr. Kerr
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agreed. I became involved. I had many other activities.
I hate to keep repeating it, but I really did.
And I became involved shortly after that
Q I'll go through these things in a moment,
but —
A So I guess the worry continued!
^^^^^^^^^^^^^^^^^^11 went to
Mr. Gates on 1 October.
Q Now let me just touch on a couple other
points. Tha July 29, 1986, briefing of Vice President
Bush by Nlr, did you have any involvement in the decision
that such a briefing should take place, any knowledge
that such a briefing was taking place?
A I had no knowledge that a briefing was being
planned. Let me back up on that because that's not a
very good answer. I knew that the Vice President was
going to Israel and I knew at some point prior to the
liNWOT"
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visit or while he was traveling to Israel that Colonel
North wanted to have Mr. Nir meet with the Vice president
to discuss the Iranian initiative.
I knew that a briefing had occurred because I
believe it was on a Saturday morning. Mr. Nir had tried
to contact Colonel North and couldn't, so he called me
and said that he had talked to Mose's deputy and that it
had gone well and that he had given him a good briefing
on the principal matter and could I convey all this to
Colonel North because he couldn't locate Colonel North
that morning, which I think I did.
That was in July 1986, I believe.
Q To the best of your knowledge was this
briefing the first or primary occasion that Vice
President Bush became aware of this initiative, or had he
been brought into these things along the way? Do you
know?
A Well, it's my understanding that the vice
President was aware of the initiative and the
Presidential Finding.
Q What is that based on? Is that just the way
things are done, or did somebody tell you that?
A I think Mr. McMahon may have mentioned that at
some point back in 1985.
^^^^^^^^^^ have no knowledge
SI
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that Mr. Ghorbanifar ever had any contact with the Vice
President. It was a convenient way to build credibility
of Mr. Ghorbanifar — I think a very unwise way, very
candidly.
Q Did you ever see a report on the Bush briefing
prepared by Bush's staff?
A Mr. — Craig Fuller — no. The only thing I
saw was what was published in the Washington Post.
Q So there was not anything generated that you
saw within the Agency?
A No, sir. I talked tc
lat some point in the fall of '86. I guess it
was in the fall of 1986. He was unaware that Mr. Nir had
met with the Vice President and he has no idea when it
occurred^^^^^^^^^^^^^^H^^H^^^^^^^^^^^^^^^^^^^^H
^ He has no
knowledge to this day. ijr
Q There came a time in July when you apparently
were in almost daily contact with Mr. Nir because Colonel
North had decided he wasn't going to talk to Nir any
more. Can you tell me a little bit about that, what
happened and why?
A Well, I was giving a briefing or sitting on a
panel, rather, with Mr. Revel 1 and others on
counterterrorism at the Office of Personnel Management in
UNCtASStffB-
683
10
UNCLASSKe
448
1 early July and I was paged by Colonel North, who stated
2 that he wanted the community alerted that does hostage
3 debriefing and he wanted intelligence collection
4 increased on Lebanon, that he had been assured by Adam,
5 which of course was a code name for Mr. Nir, that a
6 hostage would be released within 24 to 48 hours.
that^H^^^^^^^^Hjj^H went^^H
^ ^^^^^^|and waited for the release of an American
9 hostage. It did not occur. I was told by Colonel North
~ and I have reason to believe that that indeed was the
11 case — that Admiral Poindexter was quite vexed over this
12 and Colonel North stated that he didn't want to talk io
^3 Nir, that Nir had not checked out the story well and that
14 he had lost a good deal of his derriere from Admiral
15 Poindexter on the issue.
16 Clearly Colonel North's ploy was to cut off
17 contact for a period of time. All I did was to be a
18 conduit. When Nir called I would convey to Colonel North
19 what Nir stated. Colonel North gave no directions in
20 reverse. I was simply a listening post for Mr. Nir as he
21 struggled to resolve the issue and he made trips to
22 Western Europe. It was clear he was involving the Prime
23 Minister, the Defense Minister. It appeared that Mr. Nir
24 and, I assume, some of his superiors were quite disturbed
25 and almost frantic over the fact that they had lost this
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soon as
that hostage was released I certainly stopped contact and
Colonel North continued the contact.
Q And the hostage in question was Father Jenko;
is that correct?
A Father Jenko.
Q And then you wrote a memorandun or, excuse oe,
Director Casey wrote a memorandum in which he indicated
that even though only one hostage had been released it
was his view and yours and Mr. Clarridge's that the
initiative should continue. Let me show you the memo and
we'll pick up on that. It will be Exhibit 43.
(The document referred to was
marked Allen Exhibit Number 43
for identification.)
Let us make the transcript Exhibit 43 and the
July 28 memo be Exhibit 44.
(The document referred to was
marked Allen Exhibit Number 44
for identification.)
A I'm familiar with this memorandum. I did the
UmSSfFlfD
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basic draft. 1 think Mr. Casey made a few amendments to
it and he signed it and sent it to Admiral Poindexter.
Colonel North asked my assessment of the Jenko release
and he also asked that I clear with Mr. Clarridge what I
wrote. It appeared that Admiral Poindexter had the view
that the Syrians had somehow secured the release of
Father Jenko, ^^^|
^■^■^H
HH
^^^Hwho changed his mind promptly
and said indeed this is a correct assessment.
As I understand it, vice Admiral Poindexter
also agreed that it was fairly compelling evidence that
the Ghorbanifar^^^^H^ channel worked in this instance,
with a great deal of push from the Israelis.
Q In conjunction with that let me show you a
memorandum to the President which although it bears a
June 27, 1986 date I believe was actually July 27, 1986,
which will be Exhibit 45.
(The document referred to was
marked Allen Exhibit Number 4 5
for identification.)
Could you look at Exhibit 45 and tell me what
role, if any, you had in the preparation of those
materials?
luini livviLii
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WMMim
451
1 A You say you think the date was what, sir?
2 Q It is July 27. If you place it in the context
3 of the others, it appears to be a July document.
4 A I had no part in the memorandum except for the
5 fact that I was author of the attachment relating to, and
6 which I believe was part of Exhibit 44.
7 Q In terms of what's going on at this period of
8 time, I gather that there's a decisionmaking process on
9 whether or not the initiative should continue, given the
10 fact that one hostage but not all the hostages has been
11 released. Is that what was going on at that point in
12 time?
13 A I'm sorry. I didn't hear your question.
14 Q I'll try again. The decision process that
15 these documents reflect, what was the decision that had
16 to be made? What was the President being asked to
17 consider at this point?
18 A It was my understanding that he was being
19 asked to continue the initiative, to approve additional
20 explorations with this specific channel. This was in
21 June.
22 Q It's really not. It's July.
23 A July, sorry. But this was before the 15
24 August meeting in Brussels where Colonel North saw an
25 opportunity to develop what he considered a more reliable
687
y
452
1 second channel. So at this stage, as 1 understand it,
2 the President was being asked to approve continuance of
3 this effort to free the other hostages. And, as you can
4 see, there was considerable discussion about how to open
5 broader relations with the government of Iran.
6 Q Kow what that suggests to m« is that by the
7 end of July, beginning of August a decision had been made
8 to continue with the Ghorbanifar channel and, as we know,
9 in mid-August the new second channel comes on the
10 horizon. Were you aware that the second channel was
11 being courted before the courtship began, or did that
12 come as something of a surprise to you? ■"
13 A I was aware that Mr. Cave had gone to New York
14 to meet with Mr. Hakim and a contact of Mr. Hakim, an
15 Iranian,
16 was aware of that and I was aware, I believe, in some
17 conversations thatflH^U^Hand Mr. Cave had wheri^^^^
18 ^l^^^^lwas trying to elicit from Mr. Cave something
19 about a meeting that occurred in Brussels.
2 0 I was not aware that it was going to flourish
21 into full bloom until that 9 September meeting, at which
2 2 I was taken aback. I remember returning to the Agency
2 3 very nonplussed at that stage because I couldn't figure
24 out why we would so abruptly shut down the first channel
25 unless we had a very good plan for shutting it down in a
SI
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453
way that Ghorbanifar and other creditors of Ghorbanifar
would feel assuaged, that if they got their money back,
if they didn't feel they had lost that then we wouldn't
have an operational security problem.
The second channel at that stage I didn't know
anything about. I didn't know who these people were or
their reliability. And, of course, I anc^^^^^^^^^Hind
others were trying to find out who this individual was
who suddenly appeared on the screen.
len I went to see Mr. Gates on 1 October part
of our conversation was my worry over the second chanrfel,
that we had so abruptly moved to a second channel without
clearly understanding the bona fides of an individual on
whom we had no information.
That really disturbed ma more than I think
anything disturbed me throughout this whole process.
Q Did you articulate those concerns to North?
A Only in the sense of what I told you earlier,
that I e>;pressed surprise and I said what are you going
CO do about this first channel, because the creditors and
Mr. Ghorbanifar are unsatisfied. I also remember
discussing this whole thing with Mr. Cave. I said I
think Mr. Ghorbanifar is a man, is an individual who is
going to extract revenge at some point.
689
UNMSaFE
RD 454
1 Q And you would have said that at what point in
2 time?
3 A I think in the September time frame.
4 Q Let me get you to identify a document, if I
5. can. Let me show you a document that I believe was
6 generated in August of '86. It will be Exhibit 46. I
7 ask" if you can identify it.
8 (The document referred to was
9 marked Allen Exhibit Number 46
10 for identification.)
11 (Pause.)
12 A That is my handwriting. This is the frantic
13 call from Mr. Ghorbanifar in August of 1986, his
14 impassioned call where he said, look on your list. Vou
15 know, I am not charging 600 percent. My charge is, I
16 ' think he said, I guess he used the figure 41 percent
17 narlcup that he was charging. He said the middle man is
18 being unfairly blamed. He indicated that he wanted this
19 message conveyed in clear and distinct terms to the side
20 of the U.S. Government.
21 Why he called me at that time, I don't know.
22 I don't think I talked to him in recent weeks, in fact,
23 because he had been interacting with Mr. Nir. Mr. Nir
24 had been interacting innumerable times with Colonel
25 North.
t
690
mmm
1 Q In terms of what he's trying to tell you, he's
2 talking about what his margin is, but I didn't spot it.
3 Maybe it is in there. I didn't see it. Did he tell you
4 what he had paid or was told he was supposed to pay for
5 these goods — that is to say, what he was marking up 41
6 percent?
7 A He said his average overall markup on the cost
8 charged him for making all the arrangements and ensuring
9 the final delivery was 41 percent.
10 Q But I'm asking, though, do you remember him'
11 telling you my mark is X, the amount of money I paid is
12 whatever it is and I'm adding 41 percent to that? Did he
13 ever tell you what his figure was, what he was being
14 charged?
15 A I think he did over here — these notes are
16 cryptic — where he says $15 million and I'm charging,
17 the financiers are charging me 20 percent interest and
18 it's Adnan Khashoggi who is the supporter.
19 Q That is at page what?
20 A 212, sir.
21 Q Good. So at that point in August you have
22 been given what Ghorbanifar says he's being charged by
23 our end of the transaction; isn't that right? That's the
24 $15 million?
25 A Sometime in the August time frame. Mr. Cave
UNffiSSaflEIf'
691
12
13
14
15
16
17
18
19
20
&
was in the office when that call came in.
Q So at that point you got the $15 minic
Lon
figure. YOU or Mr. Cave also knew what the DOD figure
was; isn't that right? Vou knew what the CIA was paying
5 for these goods?
A $6.7 million, r guess, if you threw in the TOW
7 missiles, so we're talking about a considerable markup.
8 Q NOW at that point is that when the bells go
9 off that there's something awry here?
^° A Pretty much so.
^^ ^ °° y°" ^^^^ to Cave about how you are going to
go about figuring out what's going on?
A I discussed it with Cave, I believe, about
that time frame, after this call. i also conveyed, I
think, a fairly literal description of what Ghorbanifar
had told me to Colonel North on the secure telephone, and
I can't recall exactly what his response was, but it was
a response that was not responsive, i think he continued
to adhere to the other line that, you know, you can't
trust this fellow and what he is telling you.
^^ Q I understand. I understand.
^^ A So I conveyed the information.
^^ Q And you conveyed it to?
2* A Colonel North.
" Q And you did it what — orally, by phone, by
UNCLKra
692
UNeiASStRiD
457
1 letter?
2 A By secure telephone, sir.
3 Q And what did North tell you? What did he tell
4 you about the $15 million?
5 A I don't know that I recall, except he said,
6 you know, as I said, it's important to adhere to this
7 continuing story that this is a legitimate price and what
8 Mr. Ghorbanifar has charged is Mr. Ghorbanifar'a problem.
9 He's got to collect that money from the Iranian
10 government, something along those lines. I can't recall
11 specifically.
12 Q Let me step into where your thought processes
13 are at that point. If it were me and I was sitting
14 there, knowing that I had been involved in the sale of
15 $6.7 million of U.S. Army goods that someone had then
16 marked up by twice and made a profit of' me, I would have
n
17 gotten concerned about that.
18 A I was concerned, and I conveyed that along
19 that time frame to Mr. Kerr and, as the situation did not
20 resolve itself, I went to Mr. Gates — maybe not as
21 promptly as you would, but I did do it. And I feel good
22 about doing it.
23 Q Did it cross your mind that even if it wasn't
24 going to Nicaragua it was going into Dick Secord's
25 pocket?
umme
693
CWCUSSfflffl
458
1 A Yes, sir. That was one of my thoughts, is
2 that maybe these private Americans involved in this
3 activity were taking considerable profits, and I didn't
4 )cnow how to go about proving that. I remember that at
5 one point I expressed some concern about the reliability
6 of Mr. Hakim. Colonel North reacted in a very volatile
7 way, saying that this man was a good American and I had
8 no right to criticize him. And that was in September.
9 He said that Hakim — I think I said, I think
10 Hakim's about one cut above Ghorbanifar and I got a very
11 violent explosion from Colonel North on that. He said,
12 you don't know Mr. Hakim and that's a very unfair
13 accusation. I said that's true; I don't know Mr. Hakim.
14 Q Did you get the feeling that North was being
15 disingenuous with you in a sinister way?
16 A No, but that he was not being totally candid
17 as to what was happening.
18 Q Did you have a sense of why he was not being
19 candid?
20 A No. Colonel North — I don't consider him in
21 any way a sinister individual, and I'd like the record to
22 state that. I certainly did not think Colonel North was
23 being candid with me.
24 Q These notes, if you were trying to give your
25 best shot at when they occurred in time, when in Aucfust
694
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459
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would these notes have been made?
A The second half of August.
Q The second half?
A And I believe Ghorbanifar was aware of that
meeting in Brussels. If^^^^^^Hwas aware of it,
Ghorbanifar was aware of it because there was this
feeling on the part of Colonel North — and I think at
least initially on the part of Mr. Cave — that Mr.
Ghorbanifar could be cut out and that w« could directly
And I think Mr. Cave quickly came to the
judgment that you couldn't bypass Ghorbanifar because he
and^^^^^^Hhad a very close relationship.
Q The last page of this collection of notes says
"middle man being unfairly blamed." That I can figure
out. "41 percent" — that we've discussed. Then it says
"don't want to silence", and then below that it says
"nice", underlined twice. Do you have any recollection
of what it was you were trying to communicate there?
A I don't know what "don't want to", and that is
Nice.
Q Nice as in Nice, France.
A Mr. Ghorbanifar has a very nice home in Nice,
695
UNCUssra
460
1 and that's where he stays most of the time.
2 Q That explains that.
3
4
5
6
7
8
9 Q You did not, I take it, put this information
10 in a typewritten format?
11 A No.
12 Q Why not? Was it simply the press of time dr
13 was there some security reason?
14 A Press of time. No security reasons. There
15 was no reason in the world why I couldn't have written
16 that up. I had the equivalent of three positions at that
17 stage and frantically busy on Syria and Libya and Iranian
18 terrorism — just frantically busy.
19 Q One other phrase, just to pursue it.
20 "Merchant says the problem is because of A." I assume
21 that's Adnan Khashoggi, or do you know?
22 A Please let me look at it.
'23 (Pause.)
24 I believe so — that he was being pressed
25 heavily by Adnan Khashoggi.
wmmm
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P SECRET/CODEWORD
461
Q Did he express to you what he would do in the
face of that pressure? The clock is running. The bus is
about to leave. Help me out. What did he say?
A That was clearly the import, that something
had to be done, that the Americans should make some sort
of gesture.
So he was expecting soma
immediate gesture to close this gaping wound, as I saw
it, this gaping wound in this project.
And it was sort of he had been conveying this
on a daily basis, 1 believe, to Mr. Nir. Mr. Nir had
been calling Colonel North and finally Mr. Ghorbanifar,
one day, one night — it was nighttime because I got this
call in the afternoon — it was nighttime in France,
called me and said Charlie, what can you do. I simply
conveyed this on to Colonel North and discussed it with
Mr . Cave .
And Mr. Cave and I agreed that the prices were
mwm
697
iimssve
462
1 extraordinarily high. And I believe at that stage I
2 conveyed the view that it could be a move of sending
3 money not just to feather the pockets of perhaps
4 intermediaries but for some other project. The only
5 project that came to mind at that stage was Central
6 America.
7 Maybe we are very dull, Mr. Kerr, in coming to
8 those judgments and for that I do apologize, but my days
9 were running 14-15 hours a day on counterterrorism across
10 the board and I could not focus but a few minutes here
11 and a few minutes there on this specific initiative. I
12 took one day of leave in the last two years, I think -^
13 two days of leave, one day to be with my wife, who was
14 injured.
15 Q I promised I would get you out of here, and I
16 have not finished. I think ultimately I may need another
17 hour with you. I'm going to try to let you out of here
18 now, but there is one memorandi.un on this point that I did
19 want to run by you.
20 A Ves, sir.
21 Q It's a memorandum dated September 2, 1986 and
22 it has to do with — well, let me have you read it.
2 3 Unfortunately, we are missing a page. If you will just
24 give me a minute, I will pull the other page out and
2 5 we'll give you the whole memo.
UmSSIFIED
698
l/Nft4SSIf/ffl
463
1 (Pause.)
2 If you will mark this page, I will have to
3 make a copy of the rest of it.
4 (The document referred to was
5 marked Allen Exhibit Number 47
6 for identification.)
7 The Exhibit is September 2, 1986, memorandum
8 from Mr. Allen. It's a memorandum for the record. It's
9 Senate number J-5957 through 5959, and it relates to a
10 conversation that you apparently had with some FBI agents
11 and Customs agents on a TOW diversion. I'd like you to
12 take a moment and read the memo to refresh your
13 recollection about the incident and I'll have a few
14 questions about it.
15 (Pause.)
16 A I'm familiar with this memorandum. I'll await
17 your specific questions on it.
18 Q The memorandum makes reference at paragraph 5
19 to the footprints of the merchant and the banker or his
20 banker. The merchant in question, I assume, is
21 Ghorbanifar, and the banker Khashoggi?
22 A Yes.
23 Q Now in terms of what is happening here, it
24 appears to me that you have been asked by North to give a
25 heads-up, at the very least, to the FBI and Customs
699
464
1 S«rvic« on an illegal arms transaction.
2 A Yes, sir, just to tip them off. I had no
3 information. This is the first time I ever had any real
4 discussions with Mr. Hakim. I called Mr. Revell of the
5 FBI and Bill Rosenblatt of Customs and stated what can
6 you do about this. This is a White House request. I
7 said I have no information. I believe there are tapes of
8 at least two or three of these conversations between Mr.
9 Hakim and myself which are fairly verbatim, and I think I
10 fairly accurately — I hope I fairly accurately recorded
11 the substance of that in this memorandum.
12 Q Let me focus you on Mr. Goode. That is
13 referring to Mr. North, I assume.
14 A That is Mr. North.
15 Q And you say at the request of Mr. North,
16 Colonel North, on the 29th of August you contact Abe, and
17 that would b« Ab« Hakim; is that correct?
18 A Mr. Albert Hakim.
19 Q What instruction did you get from North? Why
20 was North asking you to do this?
21 A He stated that from the point of view of the
22 U.S. initiative if this was a bona fide TOW missile
23 diversion it would take away the leverage that the United
24 States had through the channel then being pursued — the
25 channels Z knew, the Ghorbanifai^^^^^^^^- for possible
iir
700
UNOA^ra
465
1 release of other hostages because we're talking about a
2 substantial amount of TOW missiles.
3 He wanted to know if we had any intelligence
4 from any source on it. In checking with ^^^^^^^^^HH
5 ^^^^^^^^^^^^1 no intelligence was available. I simply
6 conveyed this to both the FBI and Customs.
7 Q Let me pursue it a bit. VThen you say that
8 Hakim says the footprints of the merchant and banker are
9 all over this transaction, he was basically telling you
10 this deal looked like it was being done by Ghorbanifar
11 and Khashoggi; correct?
12 A That's what he stated and I recorded it here.
13 We couldn't find any information on this and Mr. Wall
14 from Customs later told me they couldn't find any
15 activity relating to this. I was never able to discern
16 ' just what all this alleged TOW nisaile diversion was all
17 about.
18 Q Were you aware as of 2 September that Colonel
19 North intended to or wanted to shut down the first
20 channel, Ghorbanifar?
21 A No, sir. I was not aware of it. I was aware
22 that he was highly dissatisfied with the lack of a
23 reliable conduit to the Iranian Government. I think we
24 all were.
25 Q T)-:*- .in trrm'^ XX'^VYTHT'fr^'^ ^^' ^° "^ <=^"
ff
701
UNCUSSHJ)
466
1 place it properly chronologically, you were not
2 )cnowledgeable of the second channel until a few days
3 after this event took place?
4 A No, sir. Well, I was aware that, one, Mr.
5 Cave had met with Mr. Hakim's agent in New York.
7 '^^^^^■who had a contact at the senior level inside the
8 government in Tehran. I was aware of a meeting on 15
9 August. I was aware that Mr. Hakim and Mr. Secord had
10 met with someone in Brussels, an Iranian, but I was not
11 aware that the second channel was moving to a rapid
12 fruition and adoption until 9 September, sir.
13 Q That's the point I'm trying to focus on. Did
14 it come to your attention at this time or any other time
15 that what Colonel North had in mind was taking care of
16 the first channel by getting hin indicted?
17 A At that point it did not occur to ma. It was
18 clear that Mr. Hakim — and I knew from Mr. Secord and
19 from what Mr. Ghorbanifar told me, as well as Mr. Nir,
20 that Mr. Secord had an intense antipathy towards
21 Ghorbanifar. I wrote down what Mr. Hakim said. It
22 seemed rather suspicious to me.
23 Q What I'm really asking —
24 A That here is some sort of alleged diversion
25 out of Houston and suddenly here's Ghorbanifar. Here Mr.
3RD
702
467
1 Hakim is stating that Mr. Ghorbanifar and his banker,
2 Khashoggi, are suddenly involved in this other activity.
3 That came as a surprise and I had doubts as to the
4 reliability.
5 Q Did you ever reach the conclusion or suspect
6 that you were being manipulated in early September 1986
7 to endeavor to cause criminal action to be taken against
8 Ghorbanifar?
9 A No.
10 Q You did not suspect that?
11 A No, not in that respect. The fact that Mr^.
12 Hakim was speculating, and I put this in the context of
13 speculation, he presented no evidence. I looked somewhat
14 askance at that statement in paragraph 5. But as far as
15 a conspiracy to get Ghorbanifar indicted, I didn't see
16 that, nor, based on this, can I see how that could have
17 ever occurred. How could that link? If Customs and the
18 FBI couldn't find any linkage to Ghorbanifar, how could
19 they indicate him?
20 Q In terms of suggesting that there was such a
21 linkage, were you asked to pass that suggestion on to the
22 FBI or the Customs Service?
23 A No, sir. I don't think, very candidly,
24 Colonel North gave me no indications. I think he kept
25 insisting he thought an alleged diversion might be
uNC[rae
703
wmmm
468
1 underway. Could be, if you want to speculate, that Mr.
2 Hakim was trying to manipulate Colonel North, sir.
3 Q I suspect that that's a live possibility.
4 What I'm trying to get a sense of is why on earth Colonel
5 North would want to take any risk of criminal action
6 being taken against Ghorbanifar at this delicate stage.
7 A I couldn't envision it, and I just attributed
8 the statement in paragraph 5 to the fact that Mr. Hakim
9 and Secord were partners and they both had expressed
10 intense antipathy towards Mr. Ghorbanifar. And if they
11 can somehow muddy the name of Ghorbanifar, Mr. Secord and
12 Mr. Hakim were most willing to do so.
13 You can see earlier, as you recall, earlier
14 Mr. Ghorbanifar did not like Mr. Hakim.
15 Q I know there was no love lost.
16 A Based on my memorandum of the spring of '86.
17 Q All right. Vou were not conscious, then, of
18 being privy at this or any other time to an attempt to
19 take care of Ghorbanifar by creating a situation where
20 criminal charges were brought against him?
21 A No, I don't. I don't think that would hold
22 water. I don't see how this — they would have had to
23 have had specific evidence linking Ghorbanifar to this
24 alleged diversion.
25 Q Well, the only reason I pursue it is because
704
469
1 it looks to me like Hakim was suggesting to you that
2 there may be such evidence when he talks about the
3 bankers and users certificates, letters of credit and the
4 like. Were efforts made to get that kind of evidence?
5 A Not to my knowledge. The fact that Khashoggi
6 can get end user certificates I think is not unknown,
7 given the fact he is one of the world's —
8 Q For American TOWs that could get to be a more
9 serious problem.
10 A Well, that's right, and that was Colonel
11 North's concern. How could this happen when TOW missiles
12 are very sensitive items and carefully accounted f or? -
13 Colonel North, in his conversation with me, said he just
14 didn't believe that this could be happening, but he had
15 to have it checked out. I think he was quite sincere.
16 Now whether Mr. Hakim was trying to manipulate
17 Colonel North I can't speculate on that, and I will not.
18 Q Did you suggest to the FBI, the Customs
19 Service officers, the name of Ghorbanifar?
20 A No, sir.
21 Q You did not?
22 A No, sir.
23 Q So you described the potential transaction but
24 you didn't identify people that they should talk to; is
25 that correct?
BNCWSSIfe
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1 A That is correct. I would not at that stage
2 raise the name Ghorbanlfar to either of those
3 organizations, given the fact that we had an exceedingly
4 sensitive Presidential initiative under way.
5 Q That's very helpful. I appreciate that, and I
6 do apologize for keeping you so late. I need to talk to
7 you at some point about the Furmark conversation and the
8 Nir conversation in September, but that point doesn't
9 have to come for a while.
10 A Could you refresh my recollection on the Nir
11 conversation?
12 Q On September 11.
13 A Oh, sure. That's easy.
14 MR. KERR: Thank you very much. You have been
15 very patient, Mr. Allen. Thank you.
16 (Whereupon, at 7:14 p.m., the taking of the
17 instant deposition ceased.)
18
19 Signature of the Witness
20 Subscribed and sworn to before me this day of
21 , 1987.
22
23 Notary Public
24 My Commission Expires:
UNfiUSSffl
82-688 0-88-24
706
mmsm
CERTIFICATE OP REPORTER
I, Miciial Ann Schafer, the officer before whan the foregoing
deposition was ta)cen, do hereby certify that the witness
whose testimony appears in the foregoing deposition was
duly sworn by me* that the testimony of said witness was
taken by me to the best of my ability and thereafter reduced
to typewriting under my direction; that said deposition
Is a true record of the testimony given by said witness;
that I am neither counsel for, related to, nor employed
by any of the parties to the action in which this
deposition was taken, and further that I am not a relative
or employee of any attorney or counsel employed by the
parties thereto, nor financially or otherwise interested
in. the outcome of the action.
")U^:ib^Ctbuv^dLi.).
NOTARY PCBLIC
My Coaaiasion expires February 28, 1990
UNCLASSIFIED
707
'^^ - /87
ranscnpt o
HEARINGS
Before the
SELECT COMMITTEE ON SECRET MILITARY ASSISTANCE
TO IRAN AND THE NICARAGUAN OPPOSITION
UNITED STATES SENATE
CONTINUED DEPOSITION OF CHARLES ALLEN
Monday, June 29, 1987
HASsro
ztArtose
Partially Declassified/Released on.
under provisions ol E 0 12356
by K Johnson. National Sscurity Council
Washington. D.C.
(202) S23-930O
708
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471
1 rowTTWUED DEPOSITION nv rw&BT.gfi at.t.bm
2 Monday, Jun« 29, 1987
United States Sanat*
Salact Conalttaa on Sacret
Military Assistanca to Iran
and tha Nicaraguan Opposition
Washington, 0. C.
Continuad daposition of CHARLES ALLEN, eallad
as a vitnass by counsal for tha Salact Coaaittaa, in Room
SH-219, Hart Sanata Offica Building, Washington, D. C,
coBBancing at 2:45 p.a. , tha vitnass having baan
previously duly sworn by MZCKAL ANN SCHAFER, a Notary
Public in and for tha District of Coluabia, and tha
tastiaony baing takan down by Stanomask by MICHAL ANN
SCHAFER and transcribad undar har direction.
UNcyssM
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1 APPEARANCES :
2 On behalf of the Senate Select Committee on Secret
3 Military Assistance to Iran and the Nicaraguan
4 Opposition:
5 CHARLES KEHR, ESQ.
6 TIMOTHY WOODCOCK, ESQ.
7 TOM POLGAR
8 On behalf of the Central Intelligence Agency:
9 KATHLEEN McGINN, ESQ.
10 RHONDA HUGHES, ESQ.
UNSkA^^O
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WITNESS
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Charles AH«n
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By Mr. Kerr
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CONTENTS
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EXHIBITS (Continued^
ALLEN EXHIBIT hfUMBER
FOR IDENTIFICATION
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1 PROCEEDINGS
2 Whereupon,
3 CHARLES ALLEN,
4 called as a witness by counsel on behalf of the Senate
5 Select Committee and having been previously duly sworn by
6 the Notary Public, was further examined and testified as
7 follows:
8 EXAMINATION
9 BY MR. KERR:
10 Q Mr. Allen, essentially we're going to
11 concentrate on the last part of 1986 today, but we now
12 have gotten copies of various things that were found in
13 the box of notes and miscellaneous documents of yours
14 that the Independent Counsel had, and I'd like to start
15 today by going through soma excerpts from those documents
16 that ara not dated to sea if you can give me a sense.
17 A I have not seen those since January, so I have
18 no idea what's in it.
19 Q Lat me show you a document that's called "Add-
20 ona, Coantents.'* It's our number C-0955 and 956. It will
21 ba Exhibit 48.
22 (The dociunant referred to was
23 marked Allen Exhibit Number 48
24 for identification.)
25 (Pause.)
TOI
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A I'm sure this was a conversation that occurred
in the July 1986 time frame. As you will recall, Colonel
North was assured by Mr. Nir in early July that another
hostage would be released. Colonel North paged me — and
I was attending a seminar at the Office of Personnel
Management with Constance Horner — and I was called to
the telephone, where he had stated that Nir had made this
statement, that it was imperative that we increase
intelligence collection,
land that he was going to notify
other senior officials of the government — I think
ostensibly those members of the Operations Support Group.
hostage came out. Colonel North then
called and stated that Admiral Poindexter had chastised
him severely, that hopes had been raised and then dashed,
he was in bad odor with the Admiral, and that from his
perspective it would be good if I received phone calls
from Aairam Nir until the situation improved.
Nir was very disturbed that he had lost direct
contact with the White House — extremely disturbed. He
called me every day or every other day after that for the
next two to three weeks, where he worked very hard with
Manucher Ghorbanifar to attempt to release, to obtain the
ifflcreinF
714
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477
1 r«leas« of a hostage.
2 This is one of those conversations where he
3 was trying every avenue, clearly, and he indicated that
4 he had talked to Prime Minister Peres, Defense Minister
5 Rabin, about this, about the fact that the government of
6 Israel had lost this direct link into the White House, at
7 least temporarily. And he, in this conversation,
8 described the efforts to which he had gone to try to get
9 some movement on the release of American hostages in
10 Lebanon.
11 Q To sort of place it by dates, my notes
12 indicate that that passing of the baton to you would have
13 occurred very early in July and probably would have ended
14 about July 26, when Jenko was released.
15 A That is correct, sir.
16 Q So this would have been generated in that
17 three and a half-week period?
18 A In that time frame, yes, sir.
19 Q And this reflects a call from —
20 A From Mr. Nir in Tel Aviv to me in Washington,
21 and the strenuous efforts to which he has gone — that
22 is, Mr. Nir has gone — to try to obtain some movement on
23 the hostage issue, including even looking at — he talked
24 in oblique terms, but he was pushing very hard and had
25 talked to some people that he indicated were not the
JDEWORD
IS
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478
1 nicest individuals in the world.
2 Q In terms of people he's apparently referring
3 to on the second page there is a reference to the Hashemi
4 brothers. Do you recall what that might have been about?
5 A Well, I pressed him. He said that he was
6 exploring all channels and that one channel was connected
7 to the new initiative, and I wasn't certain what that
8 meant and I still don't know what that means. But he
9 said that the channel was connected to bad guys, and when
10 I pressed to try to explain to me what he meant, since I
11 was serving essentially as a cutout or a conduit for
12 Colonel North, he said well, he had talked to some
13 members of the Hashemi brothers, and Z wrote that down.
14 That's all I have. I don't have any additional
15 background .
16 Q Do you know if this is the Cyrus Hashemi
17 family that he was referring to?
18 A Z assume that is what he was referring to, at
19 laast some of the Hashemi brothers. Cyrus Hashemi died
20 in July '86, as you recall.
21 Q That was my next question. You don't recall
22 whether this conversation took place before or after
23 Hashemi died?
24 A Z didn't know that Hashemi had died in July.
25 Z later learned that Hashemi, who was caught in the sting
716
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479
1 in April of 1986, latar dlad rather suddanly, prasuaably
2 in London.
3 Q Nir did not relat* to you Israeli attitudes
4 toward Cyrus Hasheoi in this conversation?
5 A No, not at all, except he clearly stated this
6 was a risky channel.
7 Q There are two documents that have the nanes of
8 Dick Secord and a reference to Olmstead on thea that were
9 in your files, and Z wanted to refer thea to you and see
0 if looking at then will give you any recollection of when
you might have been discussing these items.
The first is CIIN 4012, and second is CZXN
4011. They will be marked as Exhibits 49 and 50.
(The documents referred to were
marked Allen Exhibit Numbers 49
and SO for identification.)
(Pause.)
A The document number 50 looks familiar. In Kay
of 1986 we were making final arrangements relating to Mr.
20 Menurlane's trip to Tehran. One of the things that Mr.
21 Ghozbanifar needed because he was part of the advance
22 party was a flight profile, and Mr. Secord had developed
23 such a flight profile. As I recall, also Colonel North
24 had some material that he wished passed to Mr.
25 Ghorbanifar.
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25
480
Mr. Secord stated that in view of the feict
that the Government had no courier to convey this
information to Mr. Ghorbanifar in London he would provide
a courier, and I too)c some material to Mr. Secord and he
brought in the courier. And I don't recall the name of
the courier but I gave the material that Colonel North
provided, plus General Secord showed us a flight profile
and I obtained a copy of the flight profile.
Q When you use the term "flight profile", what
are you referring to?
A That is the departing time, the specific
routes, the specific air routes, when it was going to
make calls back to its communications center, how it
would go in over Iran, what would be the checkpoints
inside Iran.
718
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481
control lT8^_^^^^^^^^^^^^^^^^^^^^^^^^^^J
^^^^^^^^^^^^^^^^^1 So w«
1 Ghorbahlfar needed In ordar to giv* to the Iranian air
2
3
4 General Secord brought in a young nan and I don't recall
5 whether his name was Olmstead. I see Olmstead is written
6 down, but I don't )cnow who Olostead is. And he said this
7 individual will carry the material to the Churchill
8 Hotel, Portoan Square, in London, and when it's delivered
9 he will call you and say all is well and you can then
10 infom Colonel North.
11 And that did occur in May.
12 Q Now you actually saw the person that was held
13 out to be the courier?
14 A Yes, sir, I saw him.
15 Q Could you describe that person to me, please?
16 A I can't describe him. He was just a young
17 man, probably in his late 20s or early 30s. And I don't
18 recall whether he ha* black hair, brown hair. I just
19 don't recall him. He came in for a few moments and he
20 aaJud for a physical description of Mr. Ghorbanifar, and
21 b«tiM«n General Secord and myself we gave a description
22 so that when he transmitted the information to Mr.
23 Ghorbanifar he wouldn't mistake him for another Iranian.
24 And I recall that he probably travel under the
25 pseudonym of Smith, and he stayed, I believe, at the
719
482
1 Hilton' on Park Row. He stayed overnight before. he flew
2 back to the United States. And he called me from the
3 Hilton and said that the mission had been accomplished,
4 and I conveyed that to Colonel North.
5 Q The second document we just marked as 49 also
6 has reference to Olmstead on It. It also has what
7 appears to be an address. Do you have any recollection
8 of that document?
9 A I don't have any recollection of document 49.
10 Q Is It In your handwriting? Can you tell?
11 A This looks to be In my handwriting, yes. It
12 looks like It's in my handwriting, but I don't have any
13 recollection of what that is.
14 Q And with regard to Olmstead, you don't have a
15 clear recollection of whether or not the courier that you
16 saw was the person that was represented to be having the
17 name Olmstead?
18 A I don't think General Secord gave me his name.
19 But he said, to the best of my recollection, he stated
20 this man would be traveling under the name of Smith and
21 that he would call me from the Hilton once he had
22 accomplished delivery. It was absolutely essential from
23 our perspective that we get the flight profile to Mr.
24 Ghorbanifar in order to ensure the safety of Mr.
25 McFarlane.
720
483
1 Q With regard to the Olmstead reference that's
2 on Exhibit 50, that is in your handwriting?
3 A That looks like my handwriting.
4 Q The name Olmstead doesn't have any particular
5 meaning to you today as to whether that was the courier
6 or had some other connection to this transaction?
7 A I don't know. I don't recall. The man was in
8 his late 20s or early 30s. He had short hair. But
9 that's all I can recall.
10 Q Did he appear to have the use of both of his
11 eyes?
12 A I can't recall, sir. He was young. He spoke
13 sort of southern English, seemed like me might have been
14 from the south, but beyond that I have no distinct
15 recollection. He was only in the office for a few
16 moments. I probably was in the office less than 15
17 minutes.
18 Q Whose office did this take place in?
19 A This is General Secord's office.
20 Q General Secord's office at Stanford
21 Technology?
22 A Yes, in Vienna. I ran over and dropped the
23 material that Colonel North had given me, as well as
24 picked up a copy of the flight prof ile^^^^^^^B
25 Q Why was it that there was not a government
WSSSIFIEB
721
se»
484
1 courlar available?
2 A I can't answer that question. Colonel North
3 was the one who was making the arrangements with General
4 Secord. Generally the number of Agency people cleared
5 for this was kept, as you know, to a handful, so I guess
6 consideration was given to keeping it to a very small
7 number of people, and Mr. Olmstead did not seem
8 unfamiliar with the initiative. I mean, he didn't
9 express surprise that he was going to London — if it was
10 Mr. Olmstead.
11 I want to make sure. He was not introduced to
12 me by name, but General Secord said he will use the name
13 Smith when he calls you from London.
14 Q My primary curiosity is where the name
15 Olmstead came from. You heard it from somebody and put
16 it on this piece of paper, and if you can tell me where
17 it came from that would be helpful. If you don't recall,
18 you don't recall.
19 A I don't recall, sir. I just don't recall.
20 Q I'll show you a two-page document that's
21 headed "Mr. GhorbRnifar", which will be Exhibit 51.
22 (The document referred to was
23 marked Allen Exhibit Number 51
24 for identification.)
25 (Pause.)
Tol
UNtftSSiflED
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485
1 A This, I assume, was some telephone call from
2 Mr. Ghorbanlfar In the summer of 1986 where he again
3 tried to state some of his concerns over the financing of
4 the HAVnc spare missile parts, since we have the term 240
5 and, as you recall, there's 240 HAWK spare part line
6 items .
7 I don't recall many of the details of this,
8 but again he was talking about the cost, what he had
9 charged. I guess he says $3 million had to go to the
10 financier. But I don't understand the financing here.
11 This is Mr. Ghorbanlfar talking very excitedly and very
12 rapidly over the telephone.
13 He talked about his senior official in the
14 Prime Minister's office being angry and not calling, and
15 that in fact he cbuld cause problems. I guess he said
16 "could cause damage". Beyond that I don't have any good
17 ideas on all of this.
18 Q In trying to place it more precisely in time,
19 nothing about this document —
20 A I would state that this probeUsly occurred —
21 it must have occurred in the July time frame, because I
22 think you also showed me notes at our last session of an
23 August call where he talked about that he was only
24 charging a 41 percent premium and that the United states
25 charging five or six times that, that something was very
lEC
723
m.mm
486
1 much amiss.
2 Q The last reference on the page to action in
3 north and south, do you have any idea what that refers
4 to?
5 A Ko, I don't know. Z don't recall.
6 Q Let me show you another collection of document
7 titled "Numbers". Again, if you can place it for me as
8 best you can in time and give me the context, I'd
9 appreciate that. This is Exhibit 52.
10 (The docxiaent referred to was
11 marked Allen Exhibit Number 52
12 for identification.)
13 (Pause.)
14 A This is a conversation with Amiram Nir, the
15 special assistant to the Prime Minister of Israel on
16 counterterrorism. I can't precisely put the date on
17 this. It looks to me like that this might have been a
18 telephone call or when I met with him face to face in
19 September '86. We're talking about an Aucfust or
20 September time frame where he tried to convey to me the
21 financial arrangements, as he understood it, involving
22 the HAWK spare missile parts, and Mr. Ghorbanifar's
23 problem.
24 He talks about only 177 line items being
25 supplied of the 240 requested. He talks about the cost
724
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1 to Ghotba instead of being $15 million — as you recall,
2 Ghorba, Ghorbanifar, borrowed $15 million. Cost to the
3 Israelis $19.6 million. Twenty percent financing cost.
4 A total of $24 million.
5 I don't recall precisely. I just wrote these
6 down. I think I mentioned then to Colonel North, that
7 this was the financing as Mr. Nir saw it, and he said at
8 best Mr. Ghorbanifar could only achieve a $2 million
9 profit, that he had paid bribes and he had other costs.
10 He said the problem, as I recall, related to the official
11 in Iran who had found a 1985 microfiche which really set
12 the base manufacturing cost of the HAWK spare parts,
13 which had created problems since the cost had been
14 escalated fairly heavily when the costs were given to Mr.
15 Ghorbanifar from the NSC.
16 So we're talking about an August-September
17 1986 time frame. I suspect that this was a face-to-face
18 conversation in September, because that's the first time
19 I heard Mr. Nir talk about the new channel, and here he
20 cl«arly is talking about the new channel — does it exist
21 — and he was asking me, as I recall it, the searching
22 question is he real. Does the new channel really have
23 connections to the most senior officials in the Iranian
24 government?
25 And I simply wrote it down. I did not, as I
ictssstnfD
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488
1 recall', glv* him any sp«ciflc answer at that stag*. I
2 said I really didn't know anything about the new channel.
3 I suspect that's a September '86 document.
4 Q The reference to Zebra. I lose track. Zebra
5 was a hostage?
6 A Yes, sir, absolutely. For 14 months we've
7 referred to hostages as zebras or bank drafts.
8 Q And what Nir is asking you at that point is
9 will this get us another zebra? He's asking whether this
10 new channel has the potential for getting another hostage
11 out; is that it?
12 A Yes, absolutely. That was his concern. And,
13 as you recall, initially at least it appeared that Mr.
14 Nir was not feuniliar with the new channel or was learning
15 about it belatedly. I sensed from Mr. Nir's conversation
16 that he and his govemaent were concerned that they might
17 be cut out of the new channel or that thair role would be
18 certainly reduced in the new channel.
19 And, as Z understand it. General Secord took a
20 trip to Israel to indicate that we would use Israel as a
21 support Bechanisa but that the Israeli role would be less
22 direct. Let's put it that way.
23 Q I'm going to come back to that here in a bit.
24 Let me do some clean-up work on a couple other documents
25 that we picked Jif^ , Let me_take you to November of 1985,
«HED
726
489
1 There apparently was a meeting with David Kimche in early
2 1985, November 8-9, 1985. It is mentioned in various
3 notes we have that Kimche had lunch with Ledeen or North
4 on or about the 8th of November and that Kimche then met
5 with North and McFarlane on or about November 9.
6 Were you aware of those meetings during that
7 period of time?
8 A No, sir, I was not. I was not aware of Mr.
9 Kimche 's activities until December 3, when Mr. Ledeen
10 started providing background on the Iranian initiative.
11 Q So in terms of Kimche being in the U.S. and
12 whatever meetings he was having with the NSC, that wasn't
13 something you were privy to at the time?
14 A No, sir. I was totally unaware of it.
15 Q We also touched the last time — this is for
16 purposes of settling the chronology — on the fact that
17 McFarlane apparently told Casey November 14 and McMahon
18 that Kimche had said that the Israelis were planning to
19 send arms to Iran at the end of November.
20 Am I correct that you were not aware of that
21 meeting that McFarlane would have had with Casey and
22 McMzOion at the end of November?
23 A I was not aware at all.
24 Q You have a couple of notes dated November 15,
25 1985 that were sent about meetings that you were having.
o«»sifi£e
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Th« first Is a meeting with Nir which apparently was
scheduled for November 18, 1985, and the second is a
meeting with Colonel Zur scheduled for November 20, 1985.
Let me have those marked.
(The documents referred to were
marked Allen Exhibit Numbers 5 3
and 54 for identification.)
(Pause. )
A Yes. I don't recall the subject of either
meeting. Z recall meeting Mr. Nir initially in August of
1985. I met hia again in Israel in October '85. He
came, I believe, to Washington in November, but this was,
as I recall, at that stage because Mr. Nir was not part
of the first channel to Iran. Our discussions related
essentially
Q Specifically you have no recall of discussing
with Nir orj^lon the 18th of 20th of November the
planned hawk shipment?
A I 'a certain I did not discuss it with Mr. Nir,
and I never discussed the Iranian initiative at any time
with^^^^l^V
Q Mr. Rabin was in the U.S. during this period
as well. Did you have knowledge of him being in town
hmu
728
491
1 discussing things with McFarlane?
2 A Mr. Rabin, yes, the Defense Minister. Yes. I
3 think Z met with Mr. Nir at that stage.
4 Q So the Nir meeting would have been in
5 conjunction with the Rabin meeting?
6 A Yes. He traveled with Defense Minister Rabin.
7 He was very close to the Defense Minister, veiv close.
8 Q McFarlane placed the date of the call that he
9 got from Rabin while he was in Geneva as November 17,
10 again the same period of time as these two meetings.
11 A Yes, sir.
12 Q That did not spill over on you, I take it. You
13 weren't advised on the 17th that Nir and/or RaUoin were
14 trying to get in touch with McFarlane, trying to get some
15 help on the HAWK shipment?
16 A Not that I know of. Z met — this is November
17 '85. I don't recall that. I believe Mr. Nir returned,
18 did he not, in January '86?
19 Q Correct .
20 A Okay. During this period it was very much
21 related to our respective counterterrorist activities.
22 As I think I have at least testified to someone — I
23 can't remember whether it is you or the Independent
24 Counsel — in January '86 it was clear that Nir was
25 unaware of the initiative, because Colonel North paged me
729
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492
1 vhan w« w«re having a beer, and I had my mobile. phone
2 with me, and Nir talked cryptically to Colonel North and
3 then made a phone call to Defense Minister Rabin, but he
4 spoke in Hebrew so I have absolutely no idea what he
5 said.
6 Q But you have no present recollection, then,
7 during the time that you were involved with Dewey
8 Clarridge on this HAWK matter having any contact with
9 either Rabin or Nir?
10 A I had no contact at that stage about the
11 Iranian initiative. As you recall, Z was called on a
12 Saturday morning and told by Colonel North that I should
13 go see Mr. Clarridge, that I shouldn't be at home doing
14 housework and things like that.
15 Q Let's move in to another document that v.'e have
16 that appears to be dated December of 1985. Again to put
17 things in context, on December 4 you had your meeting —
18 you and Mr. Clarridge had your meeting with Mr. Ledeen in
19 which he went through in some detail his prior experience
20 with the Iran initiative.
21 Using that as a kind of a way of focusing your
22 recollection, I'd like you to look at this document and
2 3 do your best for me in terms of placing it in time and
24 giving me the context. That will be our next numbered
25 exhibit, which is 55.
TOP llORCnfOIl
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iiWSll
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(The document referred to. was
marked Allen Exhibit Number 55
for identification.)
(Pause. )
A That's a very curious set of notes.
Q Yes, sir.
A On the Director, I believe that was — the
Song of Solomon has to do with a letter written by Terry
Anderson which came out in about the November-December
time frame of '85 to his, I guess, common lav wife who
lived in Lebanon by whoa he had a child, and he wrote
this letter which was filled with passages from the Song
of Solomon. And if you've ever read them, they are quite
interesting.
Mr. Ledeen is, and I can't explain the note
where apparently Mr. Ledeen saw me and told me something,
except that, as you know, Mr. Ledeen 's charge from Mr.
McFarlane was to use the Ghorbanifar channel and any
others that he could develop from that to talk to
wmsm
731
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imiLo
494
important officials of th« Iranian government. And.
presumably this relates to that, where Mr. Ledeen said
that he had identified other potential senior officials
that he could talk to.
As you }cnow, he claims to have had contact
with a very senior ayatollah whose name has appeared in
the press.
As far as Director Casey, this must have been
a call or a direct contact with Mr. Casey in which he
wanted me to evaluate any information that Ghorbanifar
had on terrorism to see how valid it was, and he said
something to the effect, as I recall, you Icnow, we're
only going to give him minimal support in the area of
terrorism right now. We must keep him focused fully on
the back channel to Iran, on opening and developing
contacts in Iran, and on freeing the American hostages.
Don't encourage hia that somehow you're going
to get heavily involved with him on counterterrorist
activity. And, as I recall, I believe Mr. Clarridge even
wrote • memo at that time to either Mr. Casey or Mr.
Clair O«orge which laid out how our relationship would be
with Mr. Ghorbanifar. At least Mr. Clarridge did that, I
think in the late winter of 1985-86.
Q Try to place these notes. Would you put them
in early December?
TOP SI
'MASSIHED
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1 A ' I would put these — yeah, early December,
2 because I believe it was about that time we received this
3 letter, which we pored over eagerly, that had been sent
4 out from the Hezbollah captors to the common law wife of
5 Mr. Anderson, the AP correspondent.
6 Q There are a couple of references in the DCI
7 category that I'm curious if you have any recall about.
8 There is a reference to "shipments are dead". Do you
9 recall what that meant?
10 A No, sir, I do not. I don't have any idea.
11 Q You recollect that around December 9 -December
12 10 there was a view that the program was over.
13 A I thought it was over. As you recall, I
14 described fairly vividly ninning accidentally into
15 Colonel North at the Department of State and we talked at
16 the C Street entrance, where I said Z was there working
17 on counter-narcotics and I said well, the initiative is
18 gone, and that was when he told me it was not gone.
19 Q If that's the case, then this thing would be
20 nollitten sometime probably before December 10, right?
21 A Yes, sir. I would say that might be a good
22 time.
23 Q At or about December 10?
24 A Yes.
25 Q And essentially I guess what was being said
f(\
•asstfffD
733
496
1 h«r« Is ydu w«r« told that tha shipments ar« dead, ^ut
2 Casey wants to do the following things nonetheless —
3 revitalize linkages to Iran, pursue terrorism, that kind
4 of thing. Is that what is being said here?
5 A That's what's trritten there, and Z can't put
€ it in a precise context as to why I wrote those notes.
7 But presumably it was either direct conversation with Mr.
8 Casey or what Mr. Casey was told or what Mr. Casey
9 instructed the specific line to be.
10 Q There's another reference: "Bud wants
11 Findings." Do you have any idea what that refers to? Is
12 that Bud McFarlane?
13 A That would be Mr. McFarlane.
14 Q What Findings did he want, if you can recall?
15 A I don't know, but I assume it was after the
16 November 24-29 event. It was clear that this initiative
17 couldn't proceed without a Presidential Finding, and I
18 cannot put that in any specific context.
19 Q That doesn't stir any further recollection
20 that you would have today about what you knew about the
21 status of Findings as of early December 1985?
22 A Only what, as Z think Z've testified or
23 deposed earlier, that on the Tuesday following the
24 weekend of the so-called airlift to Iran Mr. Clarridge
25 told me that Mr. McMahon felt that a Finding was required
leassiftED
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and that the General Counsel, Mr. Sporkin, and others
were working on it.
I had no role in the Finding. I did not
monitor the status of the Finding, contrary to what 1
think someone testified that I should have been doing.
The only other reference I know to the Finding was when
Mr. Makowka and I were in Colonel North's office on 24
December, when he made some very cryptic remarks as to
the fact that something had been signed and the only copy
was in his safe. ^
Q The bottom line is you can't give me anything
further about what Casey was telling you about Findings
at the time these notes were written?
A No, sir.
Q Let me show you another Ledeen reference.
This occurs five days after your December 4 meeting.
It's December 9, 1985, and it has references to the
travel plans of ^^^^^^^^Hwhich will be Exhibit
(The document referred to was
marked Allen Exhibit Number 56
for identification.)
(Pause. )
A This is my chief of staff clearly took a call
from Mr. Ledeen on 9 December and I'm not sure where I
was. But, in any event, he talked about the senior
D.fSSIFI
735
498
1 Iraniah official flying to Frankfort, and I can't recall
2 that anything ever cam* of that particular development.
3 Q The reason I'm bringing it to your attention,
4 and some of these other documents relating to Ledeen at
5 this period of time, I'm trying to get a clear picture in
6 my mind of what you understood Ledeen 's role to be at
7 this point. We're in the first week to two weeks of
8 December. You've had your December 4 meeting.
9 What did Ledeen tell you? What was his role
10 in the Iran initiative as of that time?
11 A Mr. Ledeen at that stage told Mr. Clarridge
12 and me, and told me, I remember, c[uite directly, that he
13 remained as an NSC advisor on countert error ism, that
14 Admiral Poindexter did not want him working directly on
15 the issues relating to American hostages in Lebanon and
16 possible shipment of arms, that he was to work more
17 broadly to look at the whole issue of Iran and Iranian
18 terrorism, how to deal with the government of Iran.
19 Admiral Poindexter wanted him to suggest
20 ld««s, but Admiral Poindexter was keeping it at arm's
21 length. So this was in keeping with this guidance, which
22 I assumed was legitimate because he continued to draw a
23 salary, a consulting salary from the HSC on terrorism and
24 he provided, at that stage, information which he clearly
25 was receiving from Mr. Ghorbanifar.
736
499
1 Q • That's really my curiosity. Mr. Ledeen tells
2 you all that he has been taken off of the arms for
3 hostages.
4 A Yes. Colonel North indicated that, too.
5 Q Yet nonetheless he is apparently in fairly
6 close contact with Ghorbanifar. That didn't strike you
7 as being at odds with what you understood his
8 instructions to be?
9 A Yes, it always struck me at odds. But he
10 continued, as far as I knew, with a considerable degree
11 of contact with Ghorbanifar.
12 Q Indeed, December, January, February you knew
13 that he was having dinner with Ghorbanifar and meeting
14 him at various European locales and the like, didn't you?
15 A That's correct.
16 Q Did you have any understanding from Ledeen on
17 the extent to which he was reporting his activities back
18 to either North or Poindexter?
19 A Z assumed he was reporting all of his
20 contacts. That would relate to the broader issue of
21 probing various elements of the Iranian government. As I
22 understand it, Mr. Ghorbanifar was one channel, however
23 legitimate or illegitimate. Beyond any question he had
24 contacts at the highest levels of the Iranian government.
25 Q Did North ever indicate to you the extent to
WMife
737
500
1 which ha was familiar with the fact that Michael Ledeen
2 was continuing to have an ongoing social relationship?
3 A I recall he generally was aware that there was
4 continuing contact. But — go ahead, please.
5 . Q He didn't disapprove it? That's what I'm
6 looking for.
7 A I think he expressed concern from time to time
8 over Mr. Ledeen 's activities, that he would get into the
9 whole issue of trying to resolve the hostage issue. But
10 Mr. Ledeen came to the NSC, as far as I knew, and he
11 called me from the NSC on secure during 1986, so he must
12 have had a continuing relationship with the NSC that gave
13 certain legitimacy.
14 Q Were you aware as of early December 1986 that
15 Poindexter and North had given instructions that Ledeen
16 was not to have access to classified materials on the
17 hostage situation?
18 A What was the date, sir?
19 Q This would be early December.
20 A Yes, and I didn't give him information on the
21 hostage situation.
22 Q Again bear with me. It strikes me as a little
23 hard to understand why he would be compartmented out^^H
^^^^^^^^^^^H^Hof things people
25 still going ahead and meeting on a day-in and day-out
82-688 0-88-25
738
501
1 basis.
2 A How to differentiate the two areas?
3 Q Yes, sir.
4 A I agree with you. That question arose in my
5 mind, certainly.
6 Q Did you have occasion to discuss that with
7 North to try to get a better picture of what role Ledeen
8 really had in all this?
9 A I never had a clear role, but Colonel North
10 made it clear that on hostage matters I was not to
11 discuss then with Mr. Ladeen.
12 Q But as to what Ledeen 's function was in terms
13 of dealing with Ghorbanifar, did North ever really spell
14 that out for you?
15 A He never spelled that out. He continued to
16 consult with the NSC and to read material which was
17 classified on terrorist developments.
18 Q All right.
19 A I'm not sure how long he maintained his
2 0 clearances and his consultancy to the NSC, but it was
21 wall into 1986, so far as I know.
22 Q Was it your impression or understanding that
Ledeen had a special mission to deal with^HH^^^Hm
2 4 ^^^^^^spects of this matter as opposed to the arms-
2 5 for-hostages aspects?
TOP SECF
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OP SECRET/ CODEWORD
502
1 A ■ I would say that '3 one. I would broaden it
beyond^^^^^^^^^^^^^^Hin the sense that he looking
3 substantively at the whole issue of Iran to try to
4 detemine what could be done about opening a relationship
5 there. It was very imprecise to me and it was never
6 spelled out to me.
7 Q Let me show you another document that relates
8 to Mr. Ghorbanifar, and what I would like you to do is
9 spend a little time looking at it to see if you can tell
10 me when of the various interviews that you had with
11 Ghorbanifar these notes appear to correspond. That will
12 be Exhibit 57.
13 (The document referred to was
14 marked Allen Exhibit Number 57
15 for identification.)
16 (Pause.)
17 A This was the interview I had with Mr.
18 Ghorbanifar in the Churchill Hotel on the 25th of January
19 1986 at Portaan Square.
2 0 Q And that is the interview about which we have
21 a partial tape; is that right?
22 A You have a partial tape. You also have a very
2 3 complete, very detailed memorandum which carries
2 4 everything that he told me of any importance so far as I
25 knew at the time, of 18 February 1986.
'CODEWORD
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Q SO this exhibit, this Exhibit 57, would be the
notes that you took while the interview was going on?
A Yes.
Q Now, using these notes as a reference point,
there are a couple of things I would like to have you
elaborate on a little bit further.
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A A3 you know, Mr. McMahon sent me to interview
Mr. Ghorbanifar and to just convey the intelligence, and
he was talking generally across the board about all his
)cnowledge of terrorist groups — Libya, Syria, Iran.
I can't put this in any specific context,
except Mr. Ghorbanifar kept talking about the fact that
there were Iranian elements in Europe, there were
Revolutionary Guard elements in Lebanon, and I assume in
this case he claimed to have at least in his pay or
someone close to him involved in this type of activity
that^^^B^^^^^^^^^^^^H^^^^^^^^^^Hwas aware
perhaps targets.
Most of the terrorism, as I recall, was
against Iranian dissidents in Western Europe. He
spacifically talked a about^^^^^^^^^^^^^Kieing
clos« to him and being in his pocket, so to speak.
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There's a reference at 09390 to Ollie North
and it's a little bit hard to read. But I'd like you to
give it your best shot. There's also a reference to Mr.
North on the succeeding page, 91, but I'm particularly
interested in the question of $10 million in cash. I'd
li.'ce you to tell me as best you can what it was Mr.
Ghorbanifar was telling you about his plans for Ollie
North at this point in your conversation on the 2 5th and
2 6th of January.
A The only thing I recall is that he had some
vary elaborate statements to make about the Hezbollah and
the Iranian Revolutionary Guard Corps networks in
Lebanon, as well as Iranian networks I assume even
outside of Lebanon. I don't know what — he talked
something about $10 million in oil. I really have no
idea what all this is about.
TOP fctUEItlCOi
744
507
1 ■ I simply was writing furiously as he was.
2 speaking. But in retrospect it makes little or no sense
3 to me. He says he wanted to know how to deal with the
4 United States, how to deal with the Central Intelligence
5 Agency. It's important for him to know that he felt that
6 Ayatollah Khomeini would step down and Montezari, with
7 whom we now know ha was in close contact, would come in.
But ^^^H^^Hj^^^^Hhad no
9 support. So it all was involved in what I envisioned at
10 the time, this being only the third time, I guess, that I
11 had ever met the man, was soma grandiose scheme. And I
12 can't put it in any better context than that.
13 Q Do you have recall of this program being
14 discussed as a way of generating funds for Colonel
15 North's activities in Central America?
16 A Only in the sense that toward the end of the
17 conversation somewhere hare he apparently said something
to the effectJ^Bflj^^^^^^^H^^^^^^^^^^^^^^
if w asaiatejM^^Bii^^^BH^^^^^^^^^^^^^^^^B^B
1^|H^^^H^^^^^^^^|^^^^^^^^^^^^^^HHE^^^P^Ht h a t
21 could get whatever, $25 million for himself, $25 million
22 for Oliver North's boys down south. That's the only time
23 I ever heard any specific projects being mentioned.
24 That seemed so absurd I didn't even put it in
25 my memorandum for the record.
TOP
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WSSIFIED
508
1 Q All right.
2 A I wish I could put it in better context. I'm
3 not sure whether that portion's on the tape or not.
4 Q It's not, and I was hoping perhaps you could
5 tell me a bit more. It looks to me as if a proposal was
6 being suggested here to generate large sums of cash
7 having to do with a program of acquiring oil at below
8 market prices. But you can't tell me any more about
9 that, the program?
10 A No, I cannot. It did not seem terribly
11 likely.
12 Q All right. Turning again to Mr. Ledeen, this
13 is a February 3, 1986, memo from yourself to, I believe,
14 Dewey Clarridge, and that will be Exhibit 58.
15 (The document referred to was
16 marked Allen Exhibit Number 58
17 for identification.)
18 You might take a moment to familiarize
19 yourself with the memo.
2 0 (Pause.)
21 A I simply recorded what Mr. Ledeen told me, and
22 I recall that he did that. I did not offer any promises
23 to Mr. Ledeen. I passed it to Mr. Clarridge. Mr.
2 4 Clarridge and I discussed the matter and it was Mr.
25 Clarridge's opinion that given the direction of Mr. Casey
746
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that we should not really get involved in this, that Mr.
Casey's direction was to focus on the Ghorbanifar channel
and work on that.
So it came to naught. Nothing ever occurred
from this. But at least I went through this activity at
the request of Mr. Ledeen. Again, he represented himself
as representing Admiral Poindexter.
Q At this same period of time Ledeen was going
to former NSC Advisor McFarlane and making similar
requests that McFarlane intervene to get^^^^HHvisas
ind the like. Old you know that?
A No, sir, not at all. Ha never told me that he
had gone through any other channel on this. He had only
com* to us to see if we could be of any help.
Q Did he tell you why he was so anxious to
a s s i s t ^^^^^^^^^I^^^^^^^H
A He had already briefed, of course, me on his
contacts ^^^^l^^^^H^ind that was recorded in earlier
memoranda ,^^^^^^^^^^^^as you may know, is looked upon
747
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as very much a very hard line supporter of Islamic .
fundamentalism, yet our analysis indicates that he has
more than one side to him, like many Iranians.
This is an individual of very significant
prominence with whom one might be able to establish some,
at least, contact, so it wasn't surprising that he would
want to contact an individual likeJ^^^^^Hgiven
jstensible credentials. Yet we have found
another side where he wants to actually play in the west
or deal with the west under the table.
But I had no idea he had gone to Mr. McFarlane
with this same request.
Q But he says in this memorandum that he claims
to have met with^^^^^Hon two occasions — he being
Ledeen.
A Yes, sir.
Q And L«deen asserted that Bud McFarlane wishes
to mest^^^^^^^^^Hin the near future ^^^H^^^^^HH
Did you explore that with him at all, on why it was that
Bud McFarlane would want to meet
A No. I could speculate, but I don't have any
specific Information.
Q Were you aware of any direction at the NSC
level to pursue this^^^^^Haspect of things the way
TOP
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748
IfliSStflffl
511
1 L«deen wad pursuing it?
2 A I had no specific guidance from the NSC on
3 that except he had always asserted that he remained a
4 consultant to the NSC and he had this broader
5 responsibility to loo)c at Iran in the micro sense to see
6 what could be done and to advise the NSC Advisor.
7 Q Did he tell you what the two occasions were
8 that he -- that is, Ledeen — had met with!
9 A No. He mentioned those meetings, though, in
10 the 3 December 1985 conversation, and I asked very
11 specifically, I said that's very interesting. I'm sure
12 our operations officers and our analysts would like to
13 have memoranda of conversation on those meetings; could
14 we have them? And he said he had never put anything in
15 writing. It was too sensitive, in his view.
16 Q Did he ever tell you what had occurred at the
meeting he attendec^^^^^^^^^^^^^^^^^H in
18 late October 1985?
19 A No, sir.
20 Q He did not?
21 A No details.
22 Q McFarlane is retired, relatively long retired
23 from the NSC at this point. What was he telling you
24 about McFarlane?
25 A I think I would correct the record on that.
^^jjU^i^'^^fr
nu.
749
512
1 As I understood it, Mr. McFarlane retained his clearances
2 — I was aware of that — and that he also, even though
3 he in essence had left the National Security Advisor post
4 that he had made himself available for other duties that
5 the President might so direct.
6 Q Were you aware of any role McFarlane was
7 playing in any aspect of the Iran initiative as of
3 February 3?
9 A Not any specific role. When the discussion
10 turned in February to an American delegation going to
11 Tehran his name immediately came up.
12 Q Can you place that in the context of this
13 February 3 memo?
14 A No, sir, I can't.
15 Q Was it before or after?
16 A I cannot answer, but I would think it would be
17 after that. I think it was in the February-March time
13 fram* that McFarlane 'a name rose to the forefront as the
19 individual who would represent President Reagan in
20 Tahran.
21 Q Now I don't want to beat this thing into the
22 ground, but it's still not clear to me what it was that
23 McFarlane would be doing^^^^^^^^Bin February of
24 1936. Ledeen didn't elaborate on that at all with you?
25 A Only that this was part of the continuing
T0P.'4Bt:W^i'cd|^(
750
JgkMED
513
1 effort to .probe key officials of the Iranian government
2 as to what their attitudes were toward the west. Did
3 they really fully believe Islamic fundamentalism was a
4 way for the future? What type of minimal contacts might
5 be developed over time with the Iranian government?
6 He put it in a very realistic context.
7 Q Did you discuss this request with North at all
8 during this period of time?
9 A I don't think so. I don't recall it. I
10 discussed it with Mr. Clarridge but not with Colonel
11 North, to my knowledge.
12 Q When Ledeen made this request of you, did he
13 make it saying that he had the authorization of either
14 North or Poindexter to make this request to you?
15 A It was in the context of authorization that he
16 had from Admiral Poindexter to continue efforts with key
17 Iranian officials. He put it in that context. I didn't
18 question his.
19 Q That was my next question. You didn't have
20 oceaaion to check?
21 A No. He clearly had direct access to Colonel
22 North's office and was there on an occasional basis.
23 Q I'll show you a document that has a couple of
24 parts to it. The first — well, maybe the first is
25 marked DEA Agents, and frankly I don't know if it goes
TOlf I
mmm
751
i««D
514
with
1
2 A Would it be possible for me to take a five-
3 minute break?
4 MR. KERR: Sure. Let's take a break.
5 (A brief recess was taken.)
6 (The document referred to was
7 marked Allen Exhibit Number 59
8 for identification.)
9 THE WITNESS: This is clearly a DEA agent
-•^^^^^^^^Lind|HH|HmHH| This
11 occurred in January '86 where ha first — where Colonel
12 North wanted me to meet with these people to get some
13 idea of their access.
14 Colonel North was always pushing |HH^^^^pnd
15 ^^I^^^^^^B^'^ true operators who worked the streets and
16 who could really deal with the world's sleaziest
17 characters.
18 MR. WOODCOCK: That was not untrue, was it?
19 THE WITNESS: No, sir. They dealt with the
20 world's sleaziest characters. They are DEA agents and 1
21 did spend a year with DEA agents as the NIO for
22 narcotics, and I know the kind of life they lead. And he
23 spoke about some of their sources,]
which I know that^^^^^^and^^^^^^^|spoke about
25 this source several times.
TOP isti^:
?WSlflED
752
515
1 BY MR. KERR: (Resuming)
2 Q Let me stop you for a second, what we have
3 here is what appears to be your notes of conversation you
4 would have had with North?
5 A Probably — no. I misled you. I suspect that
with^P^^^^Hland^^^^^H^^H They
7 their contacts, so this — where this conversation
8 occurred I don't recall. I know that ^J^^^B^Bind ^^^M
9 I^^^^Hflcane to the White House situation room once wherf;
10 I was present, and it could be at that stage they talked
11 about this source, and I suspect that probably was in the
12 January '86 time frame.
13 There were other people present at that
14 meeting. London. The ones indicated London is clearly a
15 separate conversation.
16 (Pause.)
17 This is the famous meeting that occurred in
18 Room 370 Executive Office Building on or about 28 or 29
19 January 1986. Present at that meeting were Colonel
Mor^, Major Secord,^^^^^^^^H|^B Chief
21 the NE Division, or at that time he was Deputy Chief of
22 the NE Division of the Directorate of Operations. I
23 think Mr. Noel Koch was there for at least a portion of
24 the meeting, and myself.
25 And this is where Colonel North laid out his
TOpf l&i^ftlCfi
753
516
1 famous schedule which ended up with, I believe, the
2 Ayatollah stepping down.
3 Q Yes. I believe there is a reference to that
4 event.
5 A At which point I laughed very uproariously, to
6 Colonel North's annoyance, although he laughed, too. But
7 he found it also doubtful.
8 The next one has to do with — I see there is
9 a heading called DDCI. That would be Deputy Director of
10 Intelligence.
11 Q Let me stop you for just a second. The
12 document now we're referring to is 09403?
13 A Yes. I would assume this was a meeting that I
14 had in Mr. McMahon's office on the 24th of January 1986.
15 Mr. Gates was present 9H^^^^^HH^^9 Colonel North
16 joined us at some point. I was there. That was when we
17 were putting together an intelligence semple.
18 Q And this was in preparation for the trip that
19 you took January 2 5-2 6?
20 A Well, I left on the 24th. I didn't Icnow I v,'as
21 going to London. Mr. McMahon made the decision sort of
22 on the spot. I simply was working with the Directorate
23 of Intelligence in the preparation of the intelligence
2 4 package. But then Mr. McMahon said for me to go to
25 London to deliver it, so I did that afternoon.
mmm
754
517
1 The next series of notes appears to be the
2 meeting that occurred at Mr. Ledeen ' s house on the 13th
3 of January where he said he was a turnkey project man.
4 He didn't want to just be used as a foreign intelligence
5 source.
6 Q That's C-09405?
7 A Yes, sir.
8 This evidently is a telephone call from Mr.
9 Ghorbanifar that occurred late in the afternoon,
10 Washington time, on the 18th of February, 1986, and he
11 was discussing the fact that^^^Hj^^B^^^^Hwas going
12 to be in charge of operations outside of Iran
13 Q Let's try to pick up the number of that page.
14 It would be 09410; is that right?
15 A Yes, sir, that's correct.
16 Q Now on that score I'd like to clear up an
17 identification that wa had on a previous exhibit. In the
13 previous testimony you gave we looked at a series of
19 attachments to a Februairy 24, 1987 letter and we were
2 0 trying to place them in time.
21 The document that was attachment D to the
22 Rizzo letter of February 24 had been identified by Mr.
23 Rizzo as steno pad notes of a February 18, 1986,
24 telephone call, Ghorbanifar to Allen. During the course
25 of your testimony when last we spoke you indicated that
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that page, you thought, reflected notes that were taken
on January 25-26 at the meeting at the Churchill Hotel.
A Yes. I clearly was wrong in my previous
deposition on this. It clearly -- this occurred clearly
now as part of a telephone conversation.
Q And the reference specifically that we are
looking at has been stamped in the Senate files before as
C-183 and now bears number C-09412. You will note at the
bottom quarter of the page there is a reference to $25
million for OLN's project in Central America.
We previously discussed that, but I take it
this refreshes your recollection that this conversation
with Ghorbanifar took place on February 18 in the late
afternoon?
A That's correct.
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Q The note that says London in the document that
you've identified as being the notes of the meeting with
Colonel North, ^^^^^^^^Vand others on the 28th or 29th
of January, do you recall what the London reference was?
A That was the way I titled it simply because
Colonel North had just arrived from London. He had just
st«pp«d off an airplane at Dulles and in fact we had
recaived a call,^^^^^^^^|and I, think from Miss
Fawn Hall before he had arrived. As soon as he got into
calling range, he had placed a call and said that^^Hand
I were to appear at the Old Executive Office Building.
Q I'm trying to place this by date. There's a
reference that says on Tuesday (28 January) Ghorba will
757
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1 get Tehran response. And then there's a reference to
2 Wednesday. So this would have taken place, in all
3 likelihood, a day or so before January 28?
4 A Well, I thought it occurred — it could have.
5 I was thinking it occurred on the 29th of January. I had
6 just returned from London myself, but Colonel North had
7 followed me promptly to London.
8 Q You came in about the 27th?
9 A Twenty-sixth. I flew back on Monday and
10 arrived Monday afternoon.
11 Q Okay.
12 A But it was only a day or two later that
13 Colonel North had flown to London and had flown back
14 virtually the same day without stopping. He had spent
15 maybe 24 hours in London, but no more than that.
16 Q There is some pricing material in this
17 collection of notes that I'm not sure I follow and maybe
18 you can help us out. There's a reference to DOO pricing
19 of $6,000 par item, I guess it is.
20 A Per TOW, yes.
21 Q For a total of $24 million. Were you being
22 told at this time, the third week or so of January, that
23 the cost per TOW was in the range of $6,000?
24 A That's what Colonel North, I believe, read
25 off. It could be that he obtained that price from Mr.
lU
758
1 Noel Koch, who was at the meeting. I don't loiow where he
2 obtained that specific price. But I simply jotted
3 hurriedly down everything he was trying to say, because
4 he was laying out a very specific schedule. I wanted to
5 get back and get that schedule^^^^^Has I recall, which
6 I did that evening.
7 But those are, as precisely as I could record,
8 those are statements I believe made principally by
9 Colonel North.
10 Q There's a reference down here to Iranians and
11 Israelis now trust us, $24 million commitment from
12 Iranian. Do you recollect what that was about?
13 A I assume that had to do with the price that
14 would flow from the shipment of what then, I guess, was —
15 at that stage we had not gotten on to the HAWK spare
16 parts; we were still into the TOW missile era. I can't
17 elaborate more on that at this stage. It's just too long
18 ago.
19 Q Let me take you back to Ledeen. We have
20 another memorandum on Michael Ledeen. It's a memo from
21 you to Deputy Director Gates of May 28, 1986. I'd like
22 to have it marked as the next exhibit, which I guess will
23 be Exhibit 60.
24 (The document referred to was
25 IIMI#* marked Allen Exhibit Number 60
»A I4%i marKea a
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for identification.)
Take a look at it and I will have a few
questions.
(Pause. )
A I recall the memorandum.
Q With regard to this request from Ledeen, did
this meeting actually take place?
A Yes. It's my understanding it did.
Q Did you attend the meeting?
A No, sir, I didn't.
Q DO you have any knowledge what transpired at
the meeting?
A No, sir. I don't know. But it is my
understanding, I believe, based on what Mr^^edee^id
later, it dealt with what was indicated "H^IH
^^^^^^W^tnTlcnowledge of Ledeen talking to
cat*, about th« Iran initiative at this meeting?
A No, sir, I don't.
Q we know from other things that have been
generated in the course of the investigation that Ledeen
was talking to Rodman and some other folks about this
time, basically telling them that he didn't think the
arms-for-hostages approach was a good idea.
760
523
1 Q That he did think pursuing ^^^^^Hvas a good
2 idea. But he articulated a strong sense that the arms-
3 for-hostages approach simply should not be pursued. Were
4 you aware of that attitude on Ledeen's part by May of
5 1986?
6 A Ves.
7 Q Had he expressed that notion to you before May
8 of '86?
9 A I believe so. I believe that he began to
10 express that concern in December '85, when he was
11 apparently kept at arm's length and told by Adairal
12 Poindexter that he would no longer be part of the so-
13 called Iranian initiative that related to securing the
14 release of American hostages in Lebanon.
15 It's my understanding that Mr. Ledeen seemed
16 very nonplussed by this and he commented to me more than
17 once in 198 6 that he felt that this was too narrow a
18 focus for the American government to pursue, that he
19 recognized that the hostages were a stumbling block to
2 0 bett«r relations, but he felt that the focus was
21 misdirected. He said that several times.
22 Q But you do have a recollection of Ledeen being
2 3 of that view as early as December of '85?
24 A He articulated that view more clearly, I
25 think, later on. I clearly remember having lunch at CIA
mmm\i
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1 headquarters in the executive dining room sometime in
2 1986 where he articulated that view. He just said in
3 December of '85 he thought it was a mistake, the wrong
4 way to go. I think he was rather consistent.
5 Q That's good to know.
6 With regard to the role he was playing vis-a-
7 vis Ghorbanifar during this period of time, you are aware
8 that he did know that Ghorbanifar was in fact playing a
9 role in these arms transactions that took place in the
10 December through May period?
11 A I'm certain that he knew something of this
12 because Mr. Ghorbanifar is a talkative individual. But
13 Mr. Ledeen never discussed the issue with me in any
14 detail. He just indicated general knowledge that that
15 effort was continuing between Colonel North and Mr.
16 Ghorbanifar and others.
17 Q Did ha speak favorably of Ghorbanifar 's arms
18 transactions, or was he opposed to them? Did he
19 articulate that to you?
20 A As I said earlier, I think that he felt that
21 this was a fairly narrow way to go, that he didn't think
22 it was very productive, that we should be looking much
23 more broadly and we should not subordinate the broader
24 interest of our relations in southwest Asia by focusing
25 only on American hostages in Lebanon.
762
f.
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1 • He thought that was an unfortunate situation
2 but one that really shouldn't drive the project or drive
3 efforts to end this vacuum that was created with the rise
4 of the Ayatollah in 1979.
5 Q Did he, during this period of time, December
6 to May, relate to you an awareness on his part that Mr.
7 Ghorbanifar was or was trying to make a profit on these
8 arms transactions?
9 A Not in those terms, I wouldn't say that was
10 what he said. He clearly understood Mr. Ghorbanifar 's
11 motivations. Mr. Ghorbanifar is an individual who felt
12 he deserved a profit and was a wealthy man, or allegedly
13 a wealthy man, even during the days of the Shah, and that
14 he was driven principally as a businessman to make money.
15 Q I'm having trouble pulling these disparate
16 elements together here. He was dealing with Ghorbanifar
17 as a social acquaintance or friend during this period of
18 time, was he not, to your knowledge?
19 A I don't know how he characterized that
2 0 relationship. I know that he continued to, on his trips
21 to Europe, which were frequent, that it was clear that he
22 saw Mr. Ghorbanifar because he would make mention of it.
2 3 Q Well, was it your impression, standing back
2 4 and trying to look at this period of time at where
2 5 Michael Ledeen was, that Mr. Ledeen was favorably
763
526
1 disposed to Mr. Ghorbanifar engaging in arms transactions
2 and thereby profiting from them or not?
3 A I don't think he was unfavorably disposed to
4 that. He felt that Mr. Ghorbajiifar offered opportunities
5 for contact to key people,
^^^H^^^^^^^^^^Pand he was to
7 the idea of Mr. Ghorbanifar making arms deals
8 necessarily. He never spoke that he was against those
9 kinds of transactions.
10 What he spoke of critically was the U.S.
11 Government's focus on hostages in Lebanon rather than
12 looking at the broader range of issues, and that we were
13 not scrubbing down the policy options toward Iran and
14 that he had spoken to Mr. McFarlane but Mr. McFarlane was
15 very tired about the time he was leaving the NSC and that
16 he had been unable to obtain the ear of Admiral
17 Poindexter on the issue.
18 These were general complaints, and I'm
19 characterizing them in summary form. But I heard those
20 froB Mr. Ledeen on a number of occasions. I can't say I
21 totally disagreed with his judgments on it.
22 Q When you say he thought the U.S. should have a
23 broader perspective on these matters, are you suggesting
24 that he thought that whatever trade or transactions there
25 were with Iran — there should be such transactions and
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they should not be tied to hostages?
A Whatever transactions — transactions in the
broadest sense — yes, that was my understanding -- that
we should look for ways to inform key officials in the
Iranian government who were not fully aligned with
Islamic fundamentalism, leaders who still remembered days
of extensive contacts and relationship with the West,
that our efforts should be directed to establishing
contacts with those individuals and providing them
whatever support might be required.
And clearly he was thinking in terms of some
form of broad covert action, although he never
articulated it in any specific terms.
Q
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Q Let's pursue a couple of other documents and
tie them down in time. This is a document that's CIIN
number 3995. It has a July '86 date on it. If you would
look at the document, which will be Exhibit 61, and try
to place it for me.
(The document referred to was
marked Allen Exhibit Number 61
for identification.)
(Pause. )
A Well, this is, I believe, Mr. Nir, and I
Wfm SE£aET/ CODEWORD
766
-.-,^^,x -If Sj 529
1 believ.« this call occurred when the impasse had occurred
2 over pricing and the Iranian repaying Mr. Ghorbanifar and
3 the financiers, as I recall — and this would be the July
4 time frame when Mr. Nir was calling me every day or every
5 other day fairly frantically trying to continue some
6 movement on the hostage issue.
7 This is where he tal)cs about the fact that the
8 senior official in Tehran had bean told by the Iranian
9 military that the price being charged was very, very high
10 — six and six-and-a-half times the price in the
11 catalogs. So that's what that's Jibout.
12 I simply relayed such messages to Colonel
13 North on the secure phone orally.
14 Q Your recollection, however, is this would be a
15 conversation with Nir, and I take it that Nir is telling
16 you that as far aa ha could tall Ghorbanifar 's prices
17 were not outlandish.
18 A About 60 percent mar)cup.
19 Q That ha had bean, in at least this line of
20 work, reasonable.
21 A Yes.
2 2 Q That the problem was that^^H^^was
23 refusing to pay money now to Ghorbanifar; is that
24 correct?
25 A Yes. That was the real critical issue, yes.
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Q Let me show you another document which I think
is probably from the same period of time. It will be
Exhibit 62.
(The document referred to was
marked Allen Exhibit Number 62
for identification.)
(Pause. )
A I believe this is something Mr. Cave must have
told me about a conversation that he had with the senior
official in Tehran and I just jotted down what Mr. Cave
told me.
Q Would you also place this in July?
A I would place it in late June or July.
BY MR. KERR: (Resuming)
Q I want to focus in on the activities relating
to this pricing problem and make one more sweep of that.
By late June/early July you were aware of the microfiche
and the concerns that that was causing. From the
?^,fAifif^^^f?ff!f
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768
1 documents that we have it isn't altogether clear to me
2 what the CIA response to that was and the role that you
3 all were playing.
4 I gather that you were picking up calls from
5 Nir and talking to him about the pricing problem.
6 A Occasionally.
7 Q Cave was having conversations with^^^^^^H
8 and other Iranians; is that correct?
9 A Just]
10 Q Justi
11 A Ves.
12 Q And with regard to the microfiche problem we
13 have references in these documents to the microfiche
14 being made available to U.S. representatives. Was the
15 microfiche ultimately made available?
16 A It's my understanding that a microfiche was
17 flown out to Frankfort, or a copy of a microfiche, but I
18 n«ver saw it.
19 Q Do you know when that was done?
20 A It would have been in the July/ August time
21 frame. When I raised the microfiche issue with Colonel
22 North he stated he doubted that it existed and there was
23 skepticism on the U.S. side that such a microfiche
24 existed or, if it did exist, it was an old microfiche and
25 didn't have current — it wasn't a current price list of
769
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1 the cost of manufacturing the HAWK spare missile parts.
2 There were all kinds of explanations given to
3 me by people at the Agency and Colonel North. I came to
4 the conclusion in late July that there probably was a
5 legitimate microfiche because I had talked to analysts
6 that follow Iranian arms and the Iranians are quite good
7 and they have very current catalogs. I learned the
8 London procurement office knows the price of arms,
9 American and others.
10 So it didn't surprise me that they had a
11 fairly good fix on the price.
12 Q Did you talk to the CIA logistics people? I
13 mean, weren't you aware that they too knew that most of
14 the western world gets access to these microfiches?
15 A I don't think I talked to anyone in Logistics,
16 no. I talked to Mr. Cave about it, but I don't recall
17 talking to anyone in Logistics. I talked probably ^°^H
^^^^1 about
19 Q With regard to the response of the U.S., we
20 hav« heard that you all were concerned about the price.
21 Was your reaction initially that Ghorbanifar was involved
22 in some kind of a scam or not?
23 A I had an open mind. That was the original
24 judgment, I think, on the American side, that this is
25 just Mr. Ghorbanifar having been caught short in rhe 22
82-688 0-88-26
770
533
1 April sting, had some very heavy indebtedness and was
2 trying to cover it by greatly upping the price that he
3 was charging the Iranians.
4 That story stayed on for a long time. I'm not
5 sure whether Mr. Ghorbanifar was really caught in the 22
6 April sting or not. I know he was arrested for 2 4 hours.
7 But I began to believe that there might be other
8 problems, you know, in the August time frame that could
9 account for such a heavy price problem.
10 Q And we looked the other day at the notes that
11 you took which showed a pricing breakdown that made it
12 rather clear that there was something substantially
13 amiss.
14 A Mr. Ghorbanifar gave me line item costs of
15 what he was charged and what he charged the Iranians. He
16 gave, I don't know, 15 or 20 examples in a rather
17 hysterical conversation on the telephone. I can only
18 describe it as hysterical because he was screaming most
19 of the time on the telephone, and said the average price
2 0 marlcup was about 41 percent.
21 Q Now when that occurred you knew what the
22 prices were that DOD was charging.
2 3 A Well, I don't think I had ever seen that
24 pricing on the HAWK missiles. The information — I could
25 obtain that information. I knew the total price which
ii»:
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534
1 DOD charged CIA, which was $3.2 million or $3.6 million.
2 I knew it precisely at the time, but I can't recall it
3 today.
4 Q In any event, you knew that between the $15
5 million or so that had been charged Ghorbanifar and the
6 $4 million or so that had been charged to the CIA there
7 was a right large gap between them, right?
8 A There was a wide gap, yes, sir -- very wide.
9 Q With that information in hand, you knew that
10 there had to be some explanation other than Ghorbanifar 's
11 mendacity for this pricing problem?
12 A That seemed to be the case.
13 Q What I'm trying to do is trace the genesis of
14 that awareness, when it actually began.
15 A In August, for me, that there was a legitimate
16 price gap that I couldn't reconcile mentally — I
17 couldn't calculate it — that we had a price/cost when we
18 sent the price to the NSC which was — don't hold me to
19 it — but around $3.6 million or something like that, and
20 it was clear that we had charged about $15 million, or
21 that allegedly, based upon what Mr. Ghorbanifar had
22 asserted, that we had charged $15 million — something
23 like that.
24 So there seemed to be, and I'm not sure just
25 how I had all these calculations at that time, but I
772
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535
1 recall when I talked to Mr. Nir in early September I had
2 the calculations down fairly concretely.
3 Q Let me take you back into August, though,
4 before Ghorbanifar said I was charged $15 million or
5 whatever for these goods. You had not heard what was
6 charged to Ghorbanifar before them?
7 A I had heard that we had sent a bill off to the
8 NSC for $3.6 million, but at that stage I don't recall
9 explicitly that I knew what the NSC had allegedly charged
10 Ghorbanifar. But somewhere along the line I think Mr.
11 Ghorbanifar was telling me or telling Mr. Nir, at least,
12 and from Mr. Nir to me, what the charge was, that they
13 had borrowed $15 million for 30 days at 15 percent
14 interest on 15 May.
15 All this came much clearer, I think, in the
16 September/October time frames. But I hadn't focused on
17 it greatly until the August time frame because at some
18 point I had been told that Mr. Ghorbanifar was so
19 dishonest that somehow he was creating the crisis.
20 Q Who told you that?
21 A Well, that was just a general feeling on the
22 part of a number of people at the Agency. And there was
23 also a feeling on the part of Colonel North that Mr.
24 Ghorbanifar was not dealing straight up.
25 Q One of the things that troubles me and is a
wmwi
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little hard for me to follow — and there's evidence of
it in a lot of sources -- but here's a fairly clear
example. This is a memo of August 13, 1986, where I
gather George Cave is giving you a status report, and one
of the things he gives you a status report on is
microfiches.
And he says in essence we've got a problem,
not because we've got a problem with the price but
because we can't produce a phonied-up microfiche. And
that strikes me as a troublesome development. If in fact
we thought we were charging legitimate prices, we
wouldn't have to phony up a microfiche, I wouldn't think.
A In the August time
began to worry me a great deal. Why should
we go through doing something that elaborate? And there
was talk at that time of duaunying up a price list. That
did bother me.
Q I would have thought that would be a clue that
there was something amiss.
A I may be slow, but that was a clue, yes, sir.
As you know, I was focused on a thousand issues every
day, but this one was on my mind, certainly on the off
hours I wasn't at the office.
Q Let me show you this. It does appear to be
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dated August 13, 1986, and that will be Exhibit 63.
(The document referred to was
marked Allen Exhibit Number 63
for identification.)
(Pause. )
A What's the classification of this?
Q I don't )cnow.
MS. MC GINN: Has this been disseminated?
(A discussion was held off the record.)
THE WITNESS: It was conversations like this
that troubled me greatly. When I found out that we were
even beginning to consider manufacturing a price list
775
XmK) 538
1 that I probably obtained that from Mr. Cave. The
2 microfiche turned out to be laser-printed and it was hard
3 to reproduce all these new prices.
4 Q Did you and Cave talk about this microfiche
■ 5 situation? Quite frankly, I would have thought, were I
6 in your position or Mr. Cave's position, and Ollie North
7 responded to this kind of crisis by saying print up a new
8 price list we would have chatted a bit — something to
9 the effect of what the hell are we up to.
10 A I think I had a conversation at that. stage
11 with Mr. Cave, something along the lines that something
12 is really wrong here and this isn't right. And I think I
13 suggested that it appeared at that stage that Mr. Hakim
14 and Mr. Secord were playing a far more prominent role
15 than they had previously.
16 Previously they had been in a moral support
17 role, and now they ware the principal intermediaries. I
18 said something is wrong here. Something is euniss.
19 Q Let's just kind of throw that into context.
20 A It was along this mid-August 1986 time frame.
21 Q By the third week in July were you aware that
22 North gave Nir — let me put it this way. In terms of
23 the second channel, when did you become aware of the
24 possibility of the second channel existing? Was that in
25 September or did you know in July?
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A I knew in July that Mr. Cave, I believe,, had
met a contact of Mr. Hakim in New York and that they were
going to polygraph him to determine his reliability. I
learned, I guess in August, and it probably was about the
third week in August, that Major General Secord and, I
believe, Mr. Hakim had met with a new group of Iranians
I also became aware that Mr. Ghorbanifar and a
senior official in Iran had become aware of it because
they were pressing Mr. Cave about what about the meeting
that occurred in Europe^^H^^^^^H^^ It's amazing
that secrets are not kep-w long in the Iranian government.
So I was aware that we were moving toward
potentially a new channel, that Colonel North had long
wanted to get rid of Mr. Ghorbanifar. I believe the
Directorate of Operations, as you know, had long
expressed its serious doubts about the reliability of Mr.
Ghorbanifar.
I wasn't fully aware until 9 September that
th« new channel was official, and it became official that
day, I believe, by Admiral Poindexter's decision.
Q I'll stop there in a moment, but let me come
back to this period of time In mid-August, with regard
to making the fake microfiche, who did that? Was that
done by^^^^^^^^^^^^^^Hin the CIA?
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A Well, if you had to fabricate a new price
list, presumably that would be the group that did it. I
don't )cnow that it was ever tasked.
Q That was my next question. Do you know if
they actually got the assignment?
A No. You will have to talk to someone else.
Q I may not have heard you correctly. You did
not actually ever see a fake microfiche; is that right?
A Not a fake microfiche, no, sir.
Q When Mr. Cave was doing this task, trying to
create ^^^^^^^^^^^^^^^^^^^^^H the fake
was he doing it with the knowledge ofj
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|do you know?
A I'd be very surprised if he wasn't. He
t o^^^^^^H^^^^
Q So ^^^^^^^^Bwas kept apprised, to the best
of your knowledge, during this August period of this
pricing problem and the way of dealing with it?
A Yes. To the best of my knowledge, that's the
way the Agency operates.
Q Did you have occasion to discuss ^^^^JHH
Qfwhat the implications were of preparing a false
microfiche?
A No, sir.
Q Did you bring it up to a higher level, to talk
to Bill Casey or Mr. Gates about this problem?
A No, sir.
Q Tell me again why, Mr. Allen.
A Because this was being conducted under the
aeqia of the Directorate of Operations, Mr. Clair George
2j}^ ^^^^^^^^^^^^Bthat they were
operational logistics support to the NSC. I was doing
the collection, intelligence collection and coordination.
I felt that they were the proper channel vertically to
bring this to the attention of Mr. George and other
officials. ^^^^^
Q But you didn't talk to^^^Babout whether
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1 or not he had raised it to the level of Clair George?
2 A I just assumed it had been cleared up the
3 line. I would naturally assume that. And today if the
4 same situation replicated itself I would probably react
5 the same way because we are taught to report up the line.
6 Q This kind of situation, it seems to me, would
7 also raise concerns about operational security. If you
8 found yourself in a situation where you got some very
9 angry Iranians who feel they have been grossly
10 overcharged and the Agency ' s response is we have to
11 create a false pricing list, I would think that would
12 cause people to be concerned about the operation being
13 blown in short order.
14 Did you have those concerns?
15 A That was my principal concern. My principal
16 concern was that the operation would be exposed, and I
17 was alarmed and I told Mr. Kerr that sometime, in my
18 recollection, in the August time frame.
19 Q Now Mr. Kerr at that time was DDI?
2 0 A Yes, sir. He was Deputy Director of
21 Intelligence.
22 Q And with regard to the conversation with Kerr
2 3 you would place it sometime in August, I gather.
2 4 A Yes, sir. He cannot, I believe, put a time
2 5 frame on it, but I would put it in the August period.
780
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1 Q • Was there anybody else present at that
2 conversation?
3 A Not to my knowledge.
4 Q What motivated the conversation? What caused
5 you to have it with Mr. Kerr?
6 A I believe Mr. Kerr asked me for a verbal
7 update on the initiative because he'd been aware of it
8 for a considerable period of time. He had closely
9 followed the McFarlane trip into Iran. And I believe I
10 gave him an update and I talked to him of this strange
11 and rather bizarre impasse that had occurred that had
12 been dragging on for two months, or at least six weeks,
13 and that something was wrong.
14 And at that stage I was just speculating. I
15 said I wouldn't be surprised but what perhaps we are
16 overcharging at least the middleman on these matters in
17 order to send money to the contras. And he expressed
18 concern and we ended up talking about the operational
19 security of the problem, and I believe Mr. Kerr said it's
2 0 not a matter of whether it's going to be exposed but
21 whan.
22 And I said yes, I'd have to sort of agree with
2 3 you that this has been holding for a long time. And I
24 said it's going to be extremely messy if there is
2 5 something amiss about the operation.
;ei
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1 Q This question really is not intended to be
0
2 critical, but you write that kind of memo in October.
3 A I didn't write it. That was a verbal
4 statement.
5 Q I understand. But by October clearly you are
6 bringing these kinds of thoughts to Casey and Gates in a
7 written format.
8 A Yes, sir.
9 Q Why in August when you had these concerns
10 didn't you take them to Casey or Gates?
11 A It was all speculation. I didn't have any
12 pieces of information. In retrospect I wish I'd walked
13 in or at least, you know, Mr. Cave and I or someone could
14 have sat down and analyzed the situation. I just didn't,
15 and I can't offer any dynamic explanations on why I
16 didn't. I saw and worried more than anything else over
17 the potential exposure.
18 Q Did you have any reason to think in August
19 that either Casey or Gates already knew there was an
20 ovarcharge going down on the situation?
21 A No, sir.
22 Q You did not?
23 A No, sir. I don't think they were necessarily
24 aware, unless they were told by someone out of the
25 Directorate of Operations. I don't believe I brought it
IS«D
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1 to •ither Mr. Gates or Mr. Casey's attention until
2 October.
3 MR. WOODCOCK: You and Mr. Cave didn't have
4 that kind of a conversation either in August; is that
5 right?
6 THE WITNESS: I told him I thought that
7 something was amiss and maybe something was happening in
8 respect to the contras.
9 MR. WOODCOCK: You told that to Mr. Cave?
1° THE WITNESS: Yes, sir.
^^ MR- WOODCOCK: Did you expect that he would
12 have then reported that up his line?
13 THE WITNESS: I don't know. it was a
14 conversation of where we were expressing mutual concern,
15 since he usually spent most of his day in my office or
16 around my office.
^"^ MR- WOODCOCK: Do you recall that coming as a
18 surprise to him?
^^ THE WITNESS: I don't know whether it was a
2 0 surpriM, but he certainly was troubled. I remember
21 Mr. C«v« being troubled by the whole situation and
22 worried, but it is so hard to recall it precisely. We
2 3 both were mutually concerned at the time.
2* MR. WOODCOCK: And he would have been, of
25 course, a part of the DO.
TOP SECI?^
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1 ■ THE WITNESS: Yea, sir.
2 MR. WOODCOCK: Did you assume that he would
3 have taken that information to his superiors?
4 THE WITNESS: Not at that stage, because it
5 was a matter of real speculation. And I really didn't
6 personally become convinced that my judgments might be
7 right until the 9 October meeting. That really hit me.
8 So I can't speculate on what I thought at the time he
9 might do or what he did. I don't )cnow.
10 BY MR. KERR: (Resuming)
11 Q Let me come at it another way. In terms of
12 Cave's role, here's one example, but there are a number
13 of others, where Cave is talking to^^^^^H and takes it
14 upon himself to, it says, press but otherwise encourage
15 ^^^^^^1^° P*y Ghorbanifar. Cave's in a situation, I
16 take it, to your knowledge, that he is lobby ing^^^^^H
17 to pay these sums of money to Ghorbanifar that
18 Ghorbanifar said he was owed; is that right? Were you
19 awar* of that?
20 A I was aware of most of the telephone calls
21 that Mr. Cave made. He made them, I think, basically
22 from my telephone because it had a tape-recording device
23 on it, and we wanted to get fairly verbatim the
24 conversations.
25 Yes, I was aware he was calling Mr. — the
784
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1 senior official in Iran and was encouraging
2 accommodation. I saw all the memoranda of conversation
3 at least that were developed.
4 Q He was doing this at whose behest? At yours?
5 A Not at mine, no, sir. He was doing this in
6 support of the NSC and with the knowledge of the
7 Directorate of Operations. He simply was using my office
8 as an operating point.
9 Q How does he get the message, the task? Does
10 that come by way °'HH|hB<^i^ ^^y way of North, or do you
11 know?
12 A It was my understanding that the tasking
13 essentially came from Colonel North, although this was
14 closely coordinated with the NE Division. That's ray
15 understanding of th« way things happened. You can ask
16 Mr. Cave. But he kept his superiors within the Agency, I
17 think, very well informed.
18 Q Are you feuniliar with what is now going to be
19 Exh.ibit 64?
20 (The dociment referred to was
21 marked Allen Exhibit Number 64
22 for identification.)
23 (Pause.)
24 A I remember this conversation, yes, sir. I
25 remember seeing this memorandum.
iSSffEO
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s!?ke;
54S
1 Q So essentially what George Cave would da was
2 he would keep you apprised on a daily basis, so to speak,
3 of what was going on between him and^^^^^^| and he and
4 Ghorbanifar, correct?
5 A Yes. Well, he didn't call |^^^H|^^H ^ha^
6 often, and he did not really interact with Mr.
7 Ghorbanifar. It was Mr. Nir that interacted with Mr.
8 Ghorbanifar. Mr. Nir was the principal interlocutor with
9 Mr. Ghorbanifar because there was clearly a dislike
10 between Mr. Ghorbanifar — Mr. Ghorbanifar clearly didn't
11 like to deal with Mr. Cave, particularly in the summer
12 time frame.
13 Q Why was that? What was your sense of what was
14 causing that discontent on Ghorbanifar 's part?
15 A Because Mr. Ghorbanifar learned through his
16 contact in Iran that Mr. Cave was calling the individual
17 directly and that upset him. Again, after being told he
18 would not b« cut out, ha believed he was being cut out.
19 And, of coursa, the only Farsi speaker he knew that could
20 b« aalcing those calls was Mr. Cave.
21 So there was not a lot of admiration on the
22 party of Mr. Ghorbanifar for Mr. Cave.
23 Q Let me show you a memo of August 28, 1986,
24 from yourself relating a conversation you apparently had
25 with Mr. Nir, and that will be Exhibit 65.
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(The document referred to was
marked Allen Exhibit Number 65
for identification.)
(Pause. )
A Yes, I recall this conversation.
Q Could you describe the context of this
conversation? What were you and Mr. Nir about at this
point in time?
And in that conversation Mr. Nir asked whether
Mr. Cave had bean in touch with the senior official in
Iran. I said no, under instructions that I was not to
discuss thia. Aa I racall, I was under instruction from
Colonal North on this issue, but I was undone by the fact
that tha aanior official then turned around and described
this conversation in great detail to Mr. Ghorbanifar, who
in turn called Mr. Nir.
Mr. Nir found I was being duplicitous with him
TOl
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and called Mr. North to complain about me. So I recorded
that. I thought it was worth recording.
Q Well, I agree with you. What I don't
understand is why Colonel North gave you that kind of
direction. It seems to me what happened was something
that should have been anticipated.
A He made it very clear that he was working, Mr.
Cave was to work back channel with the senior official in
Iran and that in conversations with Mr. Nir I was not to
acknowledge that any of these conversations had occurred.
Q Well, let me just put it in perspective. You
were aware that Colonel North and company had been
previously burned on the direct contact with^^^^H^His
that correct?
A Yes, that's right, and that bothered me, but I
carried out the guidance. He was setting, Colonel North
was setting the strategy, using Mr. Cave, and I was
perforce very careful in what I told Mr. Nir.
788
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MS. WOODCOCK: You are awar* now that Albert
HaJclm acted as an interpreter in the FranXfort meeting on
February 25, 1986?
THE WITNESS: Yes, sir. To the best of my
recollection, I did not know that until I heard General
Secord's testimony. Maybe I )cnew it, but I didn't
correlate Mr. Hakim with that meeting in February where I
think ^^^^^^^^1 went to that meeting and Colonel North
and Mr. Nir. And they didn't have a Farsi speaker and
they needed a Farsi speaker.
MR. WOODCOCK: When does Hakim become a person
that you're aware of, then?
THE WITNESS: I think in July I started
hearing the name Hakim with the trip by Mr. Cave to New
York to meet a contact, a Mr. Hakim. And then I became
more aware of Mr. Hakim when he called me directly on the
weekend of, I believe it was. Labor Day weekend, where he
had this incredible story that thousands of TOWs were
going out of Houston.
TC
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■ And we had a lot of people trying to find out
if this was true, and Colonel North insisted that this
man Hakim was very reliable. You can trust him, totally
reliable, and if TOWs are going out of Houston there must
be something to it.
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can spea)c with^^^^^^Hthen does malce contact with
i3 that right?
THE WITNESS: Yes, that's correc
KR. WOODCOCK: That's correct. Now what I ' a
wondering is, my recollection on this -- and I may not be
crystal clear on it -- was that following this phone call
Ghorbanifar complained.
THE WITNESS: He certainly did -- bitterly.
MR. WOODCOCK: Did he complain to you?
THE WITNESS: He complained, I believe, to Mr.
Nir very/ very bitterly. And this was about the late
March time frame, and I've told the stoiry about how
Colonel North found out about this and the fact that
Ghorbanifar was essentially beside himself. Mr. Nir felt
a very sad mistake had been made in strategy, and Colonel
Horth paged me twice going over the Woodrow Wilson
Bridge.
I recall my pager going off twice, and I
called him back on my mobile phone, and he said call
Ghorbanifar, invite him to the United States. And that's
when I went home and made a call.
792
^'llfTll^lC^Sfflt/tHMPlI 556
1 MR. WOODCOCK: Where you made aware at that
2 point that part of Ghorbanifar 's unhappiness was that
3 this unauthorized contact had been made directly?
4 THE WITNESS: Yes, absolutely.
5 MR. WOODCOCK: But I gather you did not know
6 that the person making the unauthorized contact was
7 Albert Hakim?
8 THE WITNESS: I recall now the name Hakim,
9 yes, sir, but I didn't relate it to a particular person.
10 I was told that this was an Iranian expatriate or some
11 such living in this country.
12 MR. WOODCOCK: That would have been North who
13 told you that?
14 THE WITNESS: I believe Mr. Cave told me that.
15 I believe Mr. Cave. Mr. Cave was working. In fact, he
16 was in my office more than anybody else. He was there
17 hour after hour, so I'm sure Mr. Cave told me.
18 MR. WOODCOCK: Did you get any information
19 froB either North or Cave on who Hakim was, this person
2 0 wtxo suddenly out of the blue is talking ^°^^^^^^^H
21 THE WITNESS: Only that he was an expatriate
22 Iranian and that he was someone that had contacted
2 3 Colonel North. It was my impression that Mr. Cave was
24 not totally unfamiliar with Mr. Hakim, but that might be
2 5 wrong. I shouldn't speak about impressions.
793
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MR. WOODCOCK: Were either Colonel North or
Mr. Cave, from your recollection, at this time in a
position where they were able to vouch for Mr. Hakim?
THE WITNESS: I don't )cnow that Mr. Cave was.
I )cnow that Colonel North was willing to vouch for Mr.
Haki
MR. WOODCOCK: In your capacity at this point
would Hakim's reliability have been something that would
have been a concern for you?
THE WITNESS: I don't know. I just didn't
know enough about the situation, and it was clear that
Colonel North, as he operated throughout this initiative,
he did not tell me what he thought I didn't need to know.
We operate under a need-to-know principles and I didn't
need to know that for tasking and trying to collect
intelligence.
So I didn't raise issues about it. But I knew
it was considered at that stage by Colonel North as a
tactical error and that Mr. Nir felt it was a very
serious error. And we had Mr. Ghorbanifar over and Mr.
Ghorbanifar went away very pleased and reassured. He
went away to visit his girlfriend in California.
MR. WOODCOCK: There was more than one phone
i^Msire
794
558
1 call, too; Is that correct? Is that your recollection
2 that it was more than one?
3 THE WITNESS: I believe there was more than
4 one telephone call. I believe there was. And
5 essentially the Iranian official turned around and told
6 Ghorbanifar all about these calls and it seemed to me
7 that we sort of repeated that mistake later on in the
8 summer. And I guess, getting back to Mr. Kerr's
9 questions a few moments ago, that bothered me, that we
10 were repeating from as strategy point of view a mistake
11 we had made in the spring. We made it again in the
12 summer.
13 MR.- WOODCOCK: Did anyone ever explain to you
14 why Hakim was imported in at this early point?
15 THE WITNESS: Yes. I think that there was a
16 general feeling on the part of Colonel North and Mr. Cave
17 that this was not a trustworthy individual, Mr.
18 Ghorbanifar, and we ought to try to set up an alternate
19 means of talking to his interlocutor in Tehran and to cut
20 out Mr. Ghorbanifar.
21 And I recall that I talked to Colonel North
22 and told hla that was a mistake. I know Mr. Clarridge,
23 who was aware of this, thought it was a very serious
24 mistake and told Colonel North that Mr. Ghorbanifar, if
25 nothing else, knows too much. If you really want this
TOP si
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highly, sensitive, highly secret initiative to continue,
how can you cut out Mr. Ghorbanifar? Maybe he's
inconvenient. Maybe he's difficult. But you're already
into this situation in a very deep way.
And I remember sitting beside Mr. Clarridge
when he talked to Colonel North. I thought Mr. Clarridge
was absolutely right. I think he's been proven right,
and I think my view has proven right, too — that if
you're going to extricate yourself from Mr. Ghorbanifar
you've got to do it very carefully and with appropriate
amends or, as Mr. Hakim said in th« fall, September, I
guess, or October '86, with payoffs. But that never
happened. No one ever attended to Mr. Ghorbanifar even
in the spring or in the summer.
(A brief recess was taken.)
BY MS. KEKR: (Resuming)
796
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Let me take you into early September. Let's
go to the Septembtr 9, 1986 meeting, which I think we
touched on when last we talked. But v« ought to try to
wrap that up. The September 9 meeting is when you are
briefed by North and are told of the second channel and
the intention to close down the first channel; is that
correct?
A That's correct.
Q Now from other documents we have it appears
that you also briefed Casey that same day. Oo you
recollect that?
A Yes. I recall calling Mr. Casey on the secure
line.
Q So you would have net with North first and
then apprised Casey of what had happened in your meeting
with North?
A Late that afternoon or early evening, because
it was late In the afternoon on the 9th when Colonel
North — I stopped by his office. He came bursting in
and said that Admiral Poindexter had just approved the
second channel.
T5?!
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Q ■ Do you recall seeking approval from Casey to
go along with the second channel aspect of things?
A I guess no. I didn't seek any approval from
Mr. Casey. I just told Mr. Casey that Admiral Poindexter
had approved a new channel i
Q Let's just take a look at a couple of pieces
of paper. Let me show you a PROF note to North from
Earl, which apparently is reflecting a telephone call
that you made to him the following day, September 10,
reporting on the conversation that you had had with Casey
on the evening of the 9th. That will be Exhibit 67.
(The document referred to was
marked Allen Exhibit Number 67
for identification.)
Then I'm going to also show you your memo of
September 10 to Director Casey reviewing the matters that
you discussed with North the day before, on the 9th, and
that will be Exhibit 68.
(The doc\iment referred to was
marked Allen Exhibit Number 68
for identification.)
799
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A . I recall that this opening of the second
channel occurred about the same time Mr. Frank Reid was
kidnapped in Lebanon, and Mr. Casey I guess — I recall
that Mr. Casey was fairly strident in saying that if
we're going to proceed with this we ought to try to
pressure the Iranians to show their good faith by
securing the release of Mr. Reid.
Q Just so I understand what it was youj^ were
conveying, were you going to Casey to get Casey to say
yes, this is authorized to proceed with the hostage
channel, or were you going to Casey apprising him, and he
said —
A I was going to Mr. Casey to apprise him of
Admiral Poindexter's decisic
Q But when you relayed, as you apparently did,
to Earl that Casey said fine on going ahead with the
hostage project, provided we get Reid back, he was just
reacting rather than having an approval function is what
you are telling me?
A That's right. And I notice I wrote down here
"Reid released immediately." That must have been the
next day, or I must have recalled Mr. Casey's caveat that
iiJiLASSiriED
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Mr. Raid should be released before we proceeded with the
second channel. But we proceeded with the second channel
in any event.
Q But you were not of the understanding that
proceeding with the second channel required Casey's
approval. This was still very much an NSC initiative
from your perspective?
A From my perspective Admiral Poindexter had
made the decision and what was being required was that we
should proceed as the Central Intelligence Agency in
support of that decision.
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TOP SECRET/ CODEWORD
565
Q Th« reference of Ghorbanifar being cut out,
which says "to cut Ghorbanifar out Ollie will have to
raise a ninimum of $4 million", what did Ollie tell you
about $4 million when you talked to him?
TjpP, SECRET /CODEWORD
802
566
1 A . That was all he said. He said that he
2 believed that tor the United States to move to the second
3 channel that a payoff had to be made to Mr. Ghorbanifar
4 in some foi-m, and it would be a minimxim of $4 million.
5 So I put it in the memorandum.
6 Q He didn't tell you how he came up with the
7 figure?
8 A No.
9 Q He didn't tell you where he planned to raise
10 $4 million?
11 A No, sir, he certainly didn't. That certainly
12 raised —
13 Q That's more than your average lieutenant
14 colonel's salary, as far as Z recollect.
15 A That's true. But it was at that time — and I
16 didn't put it in that memo — that he says maybe we will
17 have to take it out of the reserve.
18 Q I wanted to come to that. This is the point
19 wh«n this notion of the reserve was explicitly raised to
20 yon by Ollle North?
21 A Yes, sir. And when he said reserve little
22 wheels clicked in my mind, that all my fears were
23 probably true.
24 Q Now you didn't just write a memo to Casey.
25 You also talked to him about this.
803
567
1 A I talked to him on the secure telephone.
2 Q Did you talk to him about the reserve idea?
3 A I sent a copy of that to Gates and Mr. Casey.
4 I just let it stand. At that stage I didn't because,
5 again — well, I probably should have, but these were my
6 own private musings at that stage, and my own worries
7 that the security — I guess what focused my mind with
8 the opening of the new channel was that Colonel North was
9 moving rapidly into this channel and that he had not shut
10 down the first channel in a way that would be damage-
11 limiting.
j^2 And I remember great concern at that stage.
13 Q Again bear with me, Mr. Allen. I have trouble
14 dealing with these no concepts. But when somebody who's
15 a lieutenant colonel in the U.S. Marine Corps says. A,
16 that he'« going to have to raise $4 million, and, B, that
17 he's got a reserve, back home in Baltimore that would
18 cause some eyebrows to go up. Did you ask Ollie where on
19 fBTth he wa« planning to get $4 million?
20 A NO, I didn't. But, you knov, it occurred to
21 ma that even the Israelis could find ways to raise money.
22 It wasn't ~ at that stage I was worried that there were
23 reserves and there were monies in some accounts somewhere
24 that could be used for this purpose, but it wasn't out of
25 the question ^Ut what, given the fact that Peres and
Wi
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568
Shaair and Rabin were also heavily involved, that maybe
even the Israelis would find a way to take care of
Ghorbanifar, "take care of in a good sense.
Q I understand. I didn't know the Israelis had
a reputation for laying $18 million loaves of bread on
the table.
A I'm from North Carolina, and $4 million is a
sun I can't imagine, but I didn't question that. We had
been through several sequences where substantial
financing had been raised by mysterious middlemen, so it
didn't daunt me about the fact that Colonel North was
mentioning $4 million.
What bothered me and what bothered me
afterwards was the fact that there was a major
operational security problem developing, because he had
been talking about taking care of satisfying Ghorbanifar,
Ghorbanifar being pursued by his creditors.
I felt that this was a very dangerous period
in the July/ August period, so I was very concerned. I
just felt that the situation was getting out of control.
Q But you did not feel it was something you
could sit down and grab the Colonel by the scruff of the
•romr/)
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necJc and aay, Ollie, what is it you are planning to do
here, my man. You didn't as)c him that?
A No, I didn't. And Mr. Casey and Mr. Gates I
thinJt just initialled off.
MR. WOODCOCK: Did you discuss the notion of a
reserve with George Cave at all?
THE WITNESS: I don't recall discussing it at
that stage, no.
BY MR. KERR: (Resuming)
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Q All right. Let's move on a little bit further
in September to the meeting with Nir. Nir comes in about
September, a little bit before this, about September 10.
Is that your recollection?
A Somewhere around that.
Q This would be just after the meeting you had
with Colonel North?
TOP SI
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A That's correct.
Q And Nir met with a number of people. You and
Nir met; is that correct?
A Yes.
Q Did you meet one-on-one?
A We met generally at the Agencyl
Ito discuss mutual items of
concern. I met with Mr. Nir at the Agency on a Saturday,
I recall, and I met with Mr. Nir just before he left.
Q And ha also met with Poindexter and North, to
your )cnowledge — or do you )cnow that?
A I don't know. I )cnow he met with Colonel
North, but I don't know if he met with Admiral
Poi ndexter.
809
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time?
Did you meet with North and Nir at the same
Yes.
Where would that meeting have taken place?
That was at CIA headquarters.
Anyone else present for the meeting?
Yes. Mr. Cave and Major General Secord,
Lieutenant Colonel Robert Earl. Mr. Clarridge was
present part of the time, but just to say hello; he
didn't sit in on the meeting. And I can't recall whether
— there may have been someone else from the NE Division
there, but I can't recall at this stage.
Q Can you give me a synopsis of what you recall
about what happened at that meeting?
A It was an unusual meeting, I thought, bizarre
in the sense that Colonel North was there and we were
going through trying to supply the remaining HAWK spare
missile parts using the first channel. We spent two or
thrss hours that morning talking about the first channel
as if it was still operational.
I found that unusual, but I was asked by
Colonel North to come to the meeting so that any data
relating to the shipment I would havel
So we spent a couple hours
810
574
1 that morning.
2 Q Nir was not witting, as you all like to say,
3 of the second channel at that point?
4 A I think he probably was, but I don't know that
5 he was officially witting because toward the end of the
6 morning he raised some questions which implied that he
7 was aware that other contacts were occurring by the
8 United States with Iran, and he was asking probing
9 questions.
10 Q Was he getting answers?
11 A Not from me.
12 Q How about from Colonel North?
13 A I don't think Colonel North was all that
14 forthcoming at that stage. I think there was an effort
15 to deflect the questions.
16 Q The morning was focused primarily on
17 delivering th« remaining HAWK goods through Ghorbanifar;
18 is that correct?
19 A That's correct — pricing the individual
2 0 parts. And Colonel Earl was sitting there writing out
21 the costs of the parts and costs of packaging and costs
2 2 General Secord had for transporting. General Secord had
2 3 charged a healthy price on this.
24 Q And that's what he was telling you about.
25 With regard to these pricing discussions, were these
oirams
811
IS!
575
1 prices that were going to be charged Ghorbanifar or the
2 prices that were going to be charge somebody else?
3 A These were the prices that would go from the
4 DOD and CIA to the NSC. I didn't see any of the ultimate
5 price that would be charged to Mr. Ghorbanifar.
6 Q Did that issue come up?
7 A No, sir, not to my recollection — not to my
8 recollection at all. But someone had to know, because
9 Mr. Ghorbanifar had to raise a certain amount of money.
10 Q You didn't bring it up. You all had just gone
11 through two months of pricing difficulties over HAWK
12 parts. Nobody talked about the problems that you'd been
13 living with for two months at this meeting?
14 A There was some discussion of it. Mr. Nir
15 raised it.
16 Q Do you recall what he said in that regard?
17 A Only that he felt that there were some
18 problems that couldn't be explained and that he thought
19 Mr. Ghorbanifar was being relatively straightforward. As
20 you know, in my final conversation with him before he
21 caught the plane at the airport he went again through the
22 pricing where he expressed concern over pricing.
23 Q But that was you and he together, right?
24 A No one else was present.
25 Q In this group session, though, there was no —
mmmfn
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576
I mean, you know, Nir didn't look somebody in the eye
and say what on earth are you people doing?
A Not quite like that, no. But there were
concerns, and he felt that Mr. Ghorbanifar was relaying
the guidance that was being passed by Colonel North
rather faithfully. You know, we went out. We couldn't
get all these parts. We had to go back to start up the
manufacturing line or we had to go out to six different
countries to get them back out of their inventories.
You know, there were some fairly elaborate
stories that were told by Hr. Ghorbanifar to his
interlocutors in Tehrar
Q These were stories that I assume George Cave
was feeding to Ghorbanifar at the instruction of Ollie
North .
A No, sir. I don't think Mr. Cave was involved
in this. I think Mr. North was talking to Mr. Nir, and
Mr. Mir was talking to Mr. Ghorbanifar. You've got to
remember my earlier comment that Mr. Ghorbanifar and Mr.
Cave did not talk directly after Mr. Ghorbanifar found
that Mr. Cave, in June or July, was in direct contact
with his interlocutor in Tehran.
TOP g 33CMff i CQDEVQFD
813
m
577
1 Q . SO your picture of what's going on at this
2 period of time is that in terns of setting up the sales
3 pitch, if you will, to Ghorbanifar to pass through to the
4 Iranians it would go North to Nir to Ghorbanifar? That
5 was the connection?
6 A Yes, sir. I was told by Colonel North,
7 though, that if Mr. Ghorbanifar called he gave me some
, 8 cover stories of the great difficulty in getting these
9 and that the microfiche was the manufacturer's price, it
10 wasn't the wholesale price, that you had to add all these
11 additional costs on if you try to get it through, say,
12 covert means, that one should expect to pay a very hefty
13 increase over the base price.
14 Q Well, if he goes that far, we've talked about
15 fake microfiches of August 13. Now we've got this rather
16 interesting collection of stories of things that didn't
17 happen. By September 10 everybody in that room must have
18 known that there was an enormous spread between what was
19 being paid CIA to DOD and what was being charged to
20 Ghorbanifar.
21 A I can't speak for the other people. I was
22 aware, and 1 found the meeting unusual, that there was
23 clearly two or three hours of discussion with Mr. Nir,
24 this very senior Israeli, there as if we were continuing
25 with the initial channel of Ghorbanifar. I went away
JDEWORD
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froa th« meeting ill at ease because of that.
Q Was^^^^^^^at this meeting, do you remember?
A I can't recall. There was someone else, I
think, from the NE Division there. I just can't recall.
Maybe ^^^^^^^^Hwas there; I don't ]cnow. I'm sure the
record will show, and I'm sure you can find that out.
Q Apart from the activities you discussed in the
first part of the day, is there anything else you
remember about that meeting?
A I think^^^^^^^^^lwas there because he's the
one that was working on the logistics.
Q Apart from the first channel aspect was there
anything else that was discussed with Nir that you recall
in that group session?
A
Was there simply one other meeting you had
;aET/CODEWORD
mim
815
OMSiOED
579
1 with Nir? Did you meet with him —
2 A Well, I met with him with a group once or
when we had^^^^^^^^^^^^Hdiscussions. He asked
4 me to stop by and see him before he left or to meet me.
5 I guess he was staying at the Key Bridge Marriott. He
6 called and said why don't you just come by. I've got to
7 leave in a matter of an hour or so to catch the plane
8 back to Tel Aviv, and I just want to talk over some
9 matters. And somewhere there should be some notes on my
10 conversation with Mr. Nir.
11 We just met and had a beer in the lounge and
12 he went over the pricing again, over the pricing impasse
13 that had occurred in June, July and August.
14 Q I haven't been able to locate a piece of paper
15 that looks quite like that, although I've got a couple
16 that refer to Nir.
17 A Certainly there should be notes on this
18 somewhere. I don't know. I remember writing down the
19 notes, saving them, and I'm sure they were turned in. But
2 0 th« Independent Counsel took those away so I haven't been
21 able to look at these things.
22 Q If you would mark this as Exhibit 70 —
2 3 (The document referred to was
2 4 marked Allen Exhibit Number 7 0
25 for identification.)
!«
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umm
580
And this will be Exhibit 71.
(The document referred to was
marked Allen Exhibit Number 71
for identification.)
(Pause. )
I know what this is.
Exhibit 70?
Yes, sir, Exhibit 7(
stated that he had to neet directly with Mr. Casey with
no one else present other than myself, and could I not
slip him out of the room.
Nir wanted to discuss the
Iranian initiative with Mr. Caseyl
817
y*^4*H4^\3M*t*r-n
D
1 ' And that did occur and these were the notes of
2 that conversation. I thought about doing a memorandum
3 for the record and I should have, but I just kept the
4 notes as sort of a record of what we discussed.
5 Q So these notes would have been done about
6 September 10; is that right?
7 A Yes. I'd say 11, 12, something like that.
8 Q But on the September 10, 11, 12 trip Nir made
9 into the States?
10 A Yes, and it was a long conversation. It went
11 on for probably 3 0 minutes, a full 3 0 minutes. Mr. Casey
12 was quite taken by Mr. Nir, by his intellectual vigor,
13 his ideas, and Mr. Casey talked to me afterwards about
14 what a remarkable individual Nir was, which is true. He
15 is a remarkable individual.
16 Q If you would take a look at Exhibit 71 and
17 identify that.
18 (Pause.)
19 A I can't put a precise time frame on this, but
20 this aust be — I see a date 30 September 86 written
21 th«r«, but I think this was earlier. I think this must
22 have been in the summer because that was when they
23 checked out these HAWK spare parts that were, I guess,
24 the rest of the HAWK spare parts that were delivered. I
25 guess they were delivered in August.
4,V ;1 1 i
i?!
SlFIFn
818
y^?}^fE||ac/\cTyvfpq|| 582
1 / Q They were delivered early August.
2 / A That 65 items were not working. It could be
3 August-September. But this was Mr. Nir talking about the
4 pressure that Mr. Ghorbanifar was under, that he was not
5 making money. Yeah, this had to be in September because
6 he said let him know when the package was put together --
7 that is, the package of the remaining HAWK spare parts
8 that we discussed at what I thought was a fairly
9 artificial meeting in September.
10 He said, you know, please call me when all
11 these items are put together, when the logistics people
12 have gotten it all done. And he said the Australian —
13 that is, the senior official!
14 ^^^^H — would not come out, that
15 was in trouble.
16 So this would be in the September time frame
17 after he was here, after we went through this artifice of
18 having a meeting ostensibly to continue channel one, when
19 clearly no one had any faith that we were continuing it.
20 But we went through this charade. At least I never had
21 any faith. And Mr. Nir kept calling and saying when is
22 the package going to be ready.
23 MR. WOODCOCK: Why was Secord at that meeting?
24 What was his role?
25 THE WITNESS: He was giving the prices. He
819
ytiaASSlBED
583
1 gav« some pricing that he had for charging the flying of
2 the additional HAWK spare parts into, I guess it was — I
3 believe it was HAWK spare parts and also TOW missiles
4 were involved at that stage — what would be his rates
5 for leasing his aircraft. And he gave a figure that one
6 aircraft he charged $193,000. I remember that figure;
7 • that stuck in my mind, which is a little higher than MAC
8 rates.
9 BY MR. KEKK: (Resuming)
10 Q The dollar figures that are listed in this
11 document that have the September date, do they mean
12 anything to you at all — Ghorbanifar 's $13 million to
13 Nir, for example? Does that mean anything to you?
14 A No. _There are so many figures thrown around.
15 Q ^^^H^^^l ^ assume that's $13 million to Nir.
16 A Clearly he was saying that Ghorbanifar was
17 about $12 million under. According to my calculations at
18 that stage he was probably $10 million under, perhaps,
19 that he owed creditors that much. Because then later I
20 found out from Mr. Furmark what Mr. Furmark said the
21 situation was. And I assumed that was the truth.
22 I can't offer any explanations of what that
23 meant. I wish I could.
24 Q Let me just touch on a couple of other
25 documents in September. We said that the second channel
mifn
820
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't^l.
534
1 cam« in the 19th to the 21st of September.
2 A That's correct.
3 Q This document C-09340, which will be Exhibit
4 72, was in your files. Can you tell me what it is?
5 (The document referred to was
6 marked Allen Exhibit Number 72
7 for identification.)
8 A This is something Mr. Cave drew up. It's not
9 my doc\iment; it's Mr. Cave's document. I believe it's
10 Mr. Cave's document, at least Mr. Cave obtained it. He
11 tended to just throw his files in with mine, as you
12 probably have gathered.
13 Q The handwriting at the bottom is Cave's?
14 A Yes, that's Mr. Cave's, I believe. These were
15 the seven points arrived at during the 19-20 September
16 meeting in Washington, and that's when the Iranians came
17 in and proposed a joint commission and also they
requested intelligence^^^^^^^^^^^^^^^^^^H I
19 r«call that.
20 ' This was Mr. Cave's understanding of what
21 happened, the seven points that they agreed to at that
22 time.
23 Q And the "they" would be the Iranian
24 representatives?
25 A The Iranian representatives at the 19-21
top?|e*||^/
.1 " ,■.(, ■ ■"
imp
821
585
September meetings^^^^^^^^^^^^^^^^^^J^^^^^^^^^^H
2 MR. WOODCOCK: Did Mr. Cave tell you at that
3 time that the Iranians were looking for a meeting with
4 someone as high as the Under Secretary of State?
5 THE WITNESS: I don't recall. I don't recall.
6 I don't recall that he explicitly said that. He talked
7 about a joint commission.
8 MR. WOODCOCK: Do you recall during this
9 period of time — this would be in the September 19-20
10 and immediately thereafter — Mr. Cave saying that it was
11 important at this juncture to bring the State Department
12 into the effort?
13 THE WITNESS: Yes. I recall some conversation
14 along those lines.
15 MR. WOODCOCK: Do you recall what his
16 reasoning was at that point?
17 THE WITNESS: I think he felt if we moved
18 towards a broader relationship -- he was quite excited
19 after this meeting had occurred, and I stayed in touch
20 with him, I guess, over the weekend or early the next
21 vaak — - he was quite excited about what he saw was real
22 progress.
23 And we had reached a point where they were
24 talking about joint commissions, one to look at economic
25 relations, one to look at political relations, one to
.TOPJIIM^Cl
iims
822
586
1 look at other areas, and I can't remember all of them —
2 maybe intelligence, military issues, the need that we
3 could no longer deny — that is, the White House should
4 no longer deny direct participation by the Department of
5 State, something along those lines, yes.
6 And I agreed with him that we had reached a
7 point, and it was no secret in the Department of State
8 there were a number of officials in the Department of
9 State that were aware of this initiative.
10 MR. WOODCOCK: That you knew of who were aware -
11 of it?
12 THE WITNESS: Well, I knew Mr. Oakley was
13 aware of the initiative. He didn't have the details, but
14 he was aware that it was under way. And Z think there
15 were probably others. Mr. Amacost certainly was not
16 totally unaware of this. Mr. Oakley told me there were
17 13 officials at State that were aware of this initiative.
18 He told me that in the presence of Mr. Carlucci in
19 January '87.
20 BY MR. KERS: (Resuming)
21 Q Let's move on. October 1, 1986, you have your
22 meeting with Gates in which you express concern about the
23 Iran initiative, operational security, that sort of
24 thing. At that meeting with Gates, who was there — just
25 yourself and Mr. Gates?
TOP s^fiYfPP^K^^fK^lClCn
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587
A Yes.
Q If you could give us a summary of what you
said to Gates and what he said to you on October 1, 1986,
A Yes, sir. I went up to discuss the new
channel with Mr. Gates and to brief him on it.
told him that the new channel, I didn't have any sense of
confidence at that stage in the new channel. I said
other people were quite impressed by the results of the
19-20 September meetings.
I went over the original channel and my whole
concern of the operational security as an intelligence
officer. I went through all the reasons why this thing
seemed to be going off the rails, that we were reaching
some very serious decision points, that the first channel
had not been satisfied, and that millions of dollars were
owed to creditors.
I said that this was going to be quite a
disaster. I said there is a pricing impasse that has
occurred and it's been going on — and he, I think, had
some general awareness of this, not any detailed
awareness — and that I feared that this issue would blow
up.
And also at the end of the conversation I said
TC
824
Bfefcssro
588
1 I can't prove it, but based just on the indicators I've
2 come sort of an analytical judgment that money was
3 perhaps being diverted to the contras, that the pricing
4 impasse has occurred because the United States, believe
5 it or not, was actually overcharging the middlemen
6 involved in these transactions.
7 And I remember he was very startled at this.
8 He started to laugh because it sounded absurd, but then
9 he became very serious and said, well, that would be a
10 very serious thing. Operationally you can't commingle
11 two operations. You can't commingle this operation with
12 our duties in Central America, that this was very
13 serious, that in the past he had admired Colonel North
14 because of his work in crisis management and things of
15 this nature, but that this was going too far, and asked
16 that I see the Director.
17 Q So he told you that he wanted you to see
18 Director Casey?
19 A Yes, sir.
20 Q And he appeared to you to be genuinely
21 sxirprised by the information you were conveying to him?
22 A I'm absolutely certain he was surprised, that
23 this thought had never reached his mind and no one had
24 ever suggested it previous to my raising it.
25 Q October 5 through 7, '86, North, Cave, Secord
825
UilftSSlEB
589
1 meat the second channel in Frankfort. You were aware
2 that that was happening?
3 A Yes, sir. We collected intelligence on that
4 meeting. And I guess we took the intelligence over and
5 provided it to them, to the Iranians, at that meeting,
6 and we taped the meeting. Our technicians taped the
7 meeting. I obtained the tapes when they came back. ^^^|
^^^^^^^^^H^^^^^^^^^^^^^^^^l You have a
9 of those transcripts.
10 Q Now we have another Cave memo. It's Exhibit
11 73.
12 (The document referred to was
13 marked Allen Exhibit Number 73
14 for identification.)
15 You were not in Frankfort for the meeting; is
16 that correct?
17 A Not at all.
18 Q Cave was at that meeting?
19 A Yes, he was there — Mr. Cave, Mr. North,
2 0 General Secord, Mr. Hakim were there.
21 Q And did Cave give you a briefing when he came
2 2 back on what had transpired at the meeting?
2 3 A Yes.
24 Q And he also brought this collection of nine
25 points back to you, I take it.
^IfflOTEn
826
590
1 A ■ I don't remember seeing them at the time. I
2 don't know that he even showed them to me at that time.
3 We talked generally about the meeting. I don't recall
4 seeing the nine points until later.
5 Q When do you recall seeing the nine points?
6 A I really don't recall seeing the nine points
7 until sometime in December of '86, after the diversion
8 had been determined by the Attorney General .
9 Q Oo you have any knowledge on how these nine
10 points were arrived at, who the decisionmaker was on the
11 Anerican side?
12 A I don't know.
13 Q Cave didn't tell you that?
14 A He didn't tell me that. It was my impression
15 that they were drawn up in mutual discussions with the
16 Iranians. I didn't see this. I saw it later, in the
17 December tin* frame. You know, it could well have been
18 in my files and I had not read it. Mr. Cave just put
19 folders in a little safe I had.
20 Q Let's move on to the Furmark aspect of things.
21 Fumark has testified that he saw Director Casey on
22 October 7. It's my understanding that you and Mr. Gates
23 also saw Mr. Casey on October 7 and Casey has said that
24 he talked to Poindexter on October 7. So a lot of things
25 were going on. I don't know if there is any relationship
n
827
yUCLISS^iEB
591
1 between all of them or not.
2 Let's start with your meeting and Gates'
3 meeting with Casey. Do you recall that you met with
4 Casey?
5 A Very distinctly.
6 Q And what was the purpose of that meeting?
7 A It was to inform him of the operational
8 security aspects of this initiative and the fact that
9 this program was spinning out of control and to tell him
10 also of the potential — just sheer speculation at that
11 point; we had no evidence — that money might have been
12 diverted to the contras in Central America.
13 I remember raising that and Mr. Gates chiming
14 in behind me, saying yes, that Charlie had raised this
15 issue with him and that this was an issue of real concern
16 if there was any truth in it.
17 Q Kow on that score how did Casey react to that?
18 Did he seen surprised or he had heard it someplace
19 b«fore?
2 0 A He seemed very surprised. He said he had just
21 had a call from Mr. Furmark. Mr. Furmark had come down
22 and had talked about some of the problems relating to the
2 3 initiative. And he said yes, there's a real security
2 4 issue involved here, and he asked me. At that stage I
25 said all this .troubles me greatly, and he directed that I
828
(iiUiSSi
592
1 prepare a. memorandum that would lay out the concerns and
2 he said that he had talked to Admiral Poindexter after
3 Mr. FurmarJc.
4 Q What did he say he was talking to Mr.
5 Poindexter about?
6 A About the initiative, about the fact that he
7 had done a memorandum for the record which he had sent to
8 the Chief of the Near East Division. And I went down and
9 obtained, I think, a copy from a member — maybe^^H
^^^^^^1 I a copy from^^^^^^^^H of the memorandum
11 he had written. And he said that Mr. Casey expressed
12 real concern that this thing was indeed coming apart and
13 coming apart very rapidly.
14 Q So Casey said he had sent a memo to the Chief
15 of the Near East Division?
16 A That's correct.
17 Q Did ha tell you what instructions, if any, he
18 had given to Near East?
19 A No.
2 0 Q Did they have a role in this matter, as far as
21 you ware awara?
2 2 A He didn't say that he wanted them to take any
23 action. He asked me — he just mentioned Mr. Furmark was
24 an old friend at that stage. He was a man with whom he
25 had done business ten or so years ago, that he had not
829
iiMniAQQiPii
593
1 seen Mr. funnark in five or six years, and that he
2 thought Mr. Furmark was a very straightforward, reliable
3 man. That's what he said, sir.
4 Q I understand. Let me show you the October 8
5 memo, which will be Exhibit 74.
6 (The document referred to was
7 marked Allen Exhibit Number 74
8 for identification.)
9 A Yes, I have read this memorandum.
10 Q And that is the memo that you got a copy of
11 from the Near East Division?
12 A Yes, sir.
13 Q The way that's written, it looks like it's
t o ^^^^^^^^^^H
15 A That's correctT^^^^^^^^^^Hwas Chief of the
16 Division at that time.
17 Q Did you and
18 this time?
19 A I don't recall discussing it with
2 0 I Bay have. I wouldn't be surprised but what I discussed
21 it. I know that^^^^^^^H was also becoming concerned
22 over the security of the program in the fall of '86.
2 3 Q Now apart from the security breach aspect of
2 4 things and what Furmark might or might not portend for
2 5 that, I gather from what you've just told me that you
T|)#^^i3«T^CapD*0RD
discuss this matter at
830
594
1 laid out for Casey the possibility that there had been a
2 fund of money created by the way pricing had been done on
3 these transactions; is that right?
4 A I didn't belabor the point, but I said that I
5 believed that there had been perhaps overcharging of the
6 Iranians in order to secure money to support the contras
7 in Central America.
8 Q Let me just stop you for a second on that
9 point. Your impression was Casey was also surprised to
10 hear that or not?
11 A He expressed surprise, that he had not heard
12 of this. And Mr. Gates, I know, made a comment or two at
13 that stage, stating the seriousness of the issue, and
14 this would certainly be — again, I think he talked about
15 his admiration for Colonel North as a man that gets
16 things done, but that this was going too far, if this was
17 true.
18 And I didn't have any evidence of this fact.
19 Q Was it your impression that Casey had spoken
20 to Poindexter before you all met with him that day?
21 A Absolutely, before we met with him that he had
22 already talked with Admiral Poindexter after having met
23 with Mr. Furmark.
24 Q And what he was conveying to Poindexter was
25 the concerns that he had that Furmark had related?
S ECRET/ CODEWORD
831
595
1 A That there was a real problem in the repayment
2 of the creditors and that Adnan Khashoggi was a creditor,
3 and that he had borrowed money from some Canadians and
4 that this was a very serious issue. And I can't recall
5 exactly what he said Admiral Poindexter's response was.
6 I don't precisely recall, although at some point — and
7 it may have been when I met with Mr. Casey after meeting
8 with Mr. Furmark — after I had prepared the memorandum
9 and he had showed it to Admiral Poindexter, at some point
10 — and it's in the Tower Commission report and right now
11 my recollection is a little fuzzy — but Mr. Casey said
12 you've got to get the White House counsel involved, and
13 Admiral Poindexter said I don't know that I can trust the
14 White House counsel.
15 I recall Mr. Casey telling me that.
16 Q At the time you were meeting with Casey after
17 he had had his telephone conversation with Poindexter,
18 did he indicate to you all that he had heard from Furmark
19 about the possibility of funds being diverted?
2 0 A He did not indicate that. He did not add to
21 my coaments and Mr. Gates' comments, Mr. Gates simply
22 echoing what 1 had said about the possible diversion.
23 Q Let me show you another set of notes dated
24 October 9, 1986, which will be Exhibit 75, and ask you to
25 identify them for me, please.
WMRFD
832
1%
596
1 (The document referred to was
2 marked Allen Exhibit Number 75
3 for identification.)
4 (Pause.)
5 A Yes. This is a call from Mr. Nir.
6 Q And that call you would have gotten from Nir
7 the 9th of October?
8 A Absolutely. I recall the call.
9 Q And the purpose of the call, as you recollect
10 it, is what?
11 A The purpose is to just say the situation is
12 very bad relating to Mr. Ghorbanifar, the financing —
13 his finances, repayment of creditors — and a warning, in
14 essence, a very serious warning that Mr. Ghorbanifar is a
15 man who is not easily reckoned with, that he will take
16 his revenge, that he will not stand in awe of the United
17 States, that he believed he had been hurt and that his
18 whole financial status, his legal status, was in question
19 and that something had to be done. It was a rather
20 serious call.
21 Q Did you pass that message on to Casey?
22 A 1 don't know that I passed it specifically,
23 but I passed the message on that yes, this whole
24 situation was really out of control.
25 Q Had North been apprised as of October 9 of
833
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1 thasa concerns and the Furmark visit?
2 A I don't know whether Mr. Casey discussed it
3 with Colonel North or not. He never told me.
4 Q You hadn't had such discussions with North as
5 of October 9?
6 A No, sir. I later talked about the meeting
7 with Mr. Furmark to Colonel North.
8 Q Later in October?
9 A Yes, absolutely. After I met with him on the
10 16th I talked to Colonel North. And after I went up on
11 the 24th I told Colonel North, and I think Mr. Cave also
12 talked about the meeting on I guess it was actually the
13 22nd, the night of the 22nd. And I believe I was getting
14 ready to go on a quick trip to Europe and Mr. Cave talked
15 to Colonel North on the 23rd about Mr. Furmark.
16 But I told Colonel North after I met with Mr.
17 Furmark on the 16th, and Colonel North said well, he
18 wasn't certain this was a man we could really trust and
19 for me to take that into consideration, that he had his
20 own agenda involved and I should not take him at face
21 value. He was very emphatic.
22 Q" Did North give you any indication of what he
23 was planning to do to take care of Mr. Ghorbanifar?
24 A Well, he had said more than once that some
25 effort would be made to get him involved in other
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projects, . that the second channel would find ways to get
him involved. Mr. Hakim had told me in the only meeting
I ever had with Mr. Kakim that Mr. Ghorbanifar would be
"bought off".
Q When did Hakim have this meeting with you?
A There's a memorandum for the record on that.
I think — I don't know. It was September or October.
You have the record of the conversation.
Q I would have shown it to you if I had it.
A I have inundated you with documents here.
Q That one got by me. What can I tell you?
A Well, it exists.
Q This was a meeting of just you and Hakim? who
else was present?
A Mr. Secord was present for a brief period.
Mr. Hakim flew into town. Major General Secord called
and said that Mr. Hakim wanted to talk
And I raised the whole subject with Mr. Hakim
of Ghorbanifar. What are you going to do about it? And
he said we'll buy him off.
Q Did he give you any indication of what
resources they were going to use to buy him off and what
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1 the price. would be?
2 A No. But by then I had — my instincts were
3 telling me that there was a reserve, there were funds,
4 there were bank accounts somewhere. I didn't want to
5 accuse Mr. Hakim since I had just met him. I just took
6 that data in and it's in the memorandum for the record.
7 Q I'll track it down.
8 A It exists.
9 Q I have no doubt about that, Mr. Allen. I'll
10 talk to the computer and see if they can locate it for
11 me.
12 The Director and Mr. Gates had lunch with
13 Lieutenant Colonel North on October 10. Were you aware
14 that they were having that lunch? Did you receive a
15 report after it?
16 A No, I didn't know they had it.
17 Q So no one told you what transpired at that
18 meeting?
19 A No. I did not know that that meeting existed.
20 I aay have known Colonel North was in the building, but I
21 didn't know that they had lunch.
22 Q Neither the Director nor the Deputy Director
2 3 gave you any description of what had happened at the
2 4 meeting, the questions they had asked, anything of that
2 5 kind?
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1 A . No, sir, not at that time. After the 25th of
2 November, I believe — no, I'm sorry. After the exposure
3 of the initiative I believe Mr. Gates mentioned it to me.
4 No, it was after November 25. Mr. Gates discussed that
5 with me and the fact that he had done a memorandum for
6 the record. And he showed me the memorandum for the
7 record when he discussed it with me.
3 Q Now you prepared a memo for the Director and
9 Deputy Director on concerns that you had about the Iran
10 initiative.
11 A Yes.
12 Q Which is dated October 14, and that will be
13 Exhibit 76.
14 (Th« document referred to was
15 marked Allen Exhibit Number 76
16 for identification.)
17 A Um-hun.
18 Q That is your memo?
19 A Yes.
2 0 Q That memo was presented by you at a meeting
21 that you and Gates and Casey had on the 14th?
2 2 A No, sir. I took it, the original, to Mr.
23 Gates' office. Eyes Only, to his secretary on the morning
24 of the 15th and I said I have a very exceedingly
25 sensitive memorandum. I said I didn't want to give it
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1 directly to Mr. Casey because I wasn't certain what he
2 would do with it. I wanted Mr. Gates to look at it
3 carefully first and decide what to do with it.
4 I said Mr. Casey might go down and just hand
5 it to someone at the White House straight away, and I
6 said there's a lot of potentially explosive material in
7 this memorandum, and I kept calling. And then I found
8 out later, on the 16th, I was called in by Mr. Casey and
9 Mr. Gates and they said that not only had they read the
10 memorandxim on the 15th, that Gates had taken the original
11 in, and Mr. Casey and Mr. Gates had called Admiral
12 Poindexter immediately after reading it and set up a
13 meeting.
14 They took it down and not only let Admiral
15 Poindexter read it, but they gave it to him. And I said,
16 oh, my God. If I'm wrong in this, Colonel North will
17 never speak to m* again. And he says, well, we don't
18 think it's that kind of memorandum to find fault. We
19 think it was a good memorandxua.
2 0 They said Admiral Poindexter read it very
21 carefully, asked who wrote it. They told him that I
22 wrote It and Admiral Poindexter said he would study it.
2 3 And that was on the morning of the 16th, I guess.
24 Q All right. So the memo was not discussed in
2 5 your presence with Gates and Casey; correct?
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1 A , No, sir. I gave it to Gates because I thought
2 maybe I had gone too far in just totally condemning the
3 initiative in essence.
4 Q And you were not present at the meeting with
5 Poindexter?
6 A No, sir, I was not.
7 Q Did you ever have occasion to discuss this
8 memo with Poindexter?
9 A No, sir, I never did. Never had the
10 opportunity. I never received any indication from him or
11 from Colonel North. I don't know that Colonel North ever
12 read the memorandum. I suspect he did, but he never told
13 me he did.
14 Q You did meet with Furmark on the 16th; isn't
15 that right?
16 A Yes. When we met on the morning of the 16th
17 in the Director's suite with Mr. Gates present he said I
18 think it's essential you talk to Mr. Funnark. I'll call
19 hi». And I said well, okay, I'll go to New York and Mr.
20 Caa«y said no. You're busy, why don't you just have Mr.
21 Furoark come down here?
22 Well, that turned out to be an unfortunate
23 decision, I think, because Mr. Furmark came down. He got
24 delayed in transit and it ended up we had only about 4 5
25 minutes of discussion. I met with him in Mr. Casey's
839
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603
1 office in the Executive Office Building, and Mr. Casey
2 invited Mr. Furmark to fly back with him to New York on
3 the Director's plane, and Mr. Furmark did that.
4 So I wrote up the memorandum, which again said
5 that this only reinforced all my worries, concerns,
6 fears, but I didn't have enough time to talk to him, to
7 Mr. Furmark. And I told Mr. Casey it was absolutely
8 essentially I get right back with Mr. Furmark, but
9 unfortunately I didn't see him for, I guess, a week —
10 almost a veek, for six days.
11 Q Let me just show you a couple of pieces of
12 paper from this time period. We have what appears to be
13 an October 16, 1986, set of notes, one of which in the
14 middle seems to refer to a conversation you had with the
15 Director about Furmark.
16 (The document referred to was
17 marked Allen Exhibit Number 77
18 for identification.)
19 A Yes. This was clearly the morning of the
2 0 16th, Z guess, when Mr. Gates and Mr. Casey and I were
21 tog«th«r. I was called up by Mr. Casey, walked in. Mr.
22 Gates was there. That's when they started talking about
23 what had happened with my memorandum. And he again
2 4 talked about — I wrote down Fred Furmark, but it was Roy
2 5 Furmark.
Ti
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1 . He said he was a patriot, that he did have
2 business relationships with Mr. Khashoggi. It turned out
3 that he was in at the beginning of the Iranian
4 initiative. And that he had Khashoggi raise the money.
5 Mr. Casey said he thought Khashoggi was essentially
6 politically well disposed towards the United States.
7 Q Did Casey indicate that he had talked to
8 Furmark in addition to the initial contact of October 7-
9 October 8?
10 A I don't know that he said he had talked to Mr.
11 Furmark again, but he had called Mr. Furaark while I was
12 there and set up the meeting. He couldn't get through to
13 Mr. Furmark ininediately, but Mr. Casey called me back
14 later in my office, when I was back in my office, and
15 said that Mr. Furmark will meet you at such and such a
16 time and why don't you use my office down at the
17 Executive Office Building.
18 So that's what we did. But it turned out that
19 Mr. Furmark had several hours of information to tell me
20 and I tried to squeeze it in to 45 minutes.
21 Q And it was just you and Furmark; is that
22 right?
23 A That is absolutely correct.
2 4 Q And what resulted from that meeting was your
25 October 17, 1986, memo? And that will be Exhibit 78.
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Msttfkl^±t)^«i^ 605
1 (The document referred to was
2 marked Allen Exhibit Number 78
3 for identification.)
4 A That's correct.
5 Q Now did you ever get a report from Casey on
6 what he and Furmark had talked about on that airplane
7 ride?
8 A No, sir. He never mentioned the substance of
9 that airplane ride.
Q All right. We have another reference to
10
11 Furmark that appears to be dated on or about October 22,
12 1986. Let me show it to you. This will be Exhibit 79.
13 (The document referred to was
3^4 marked Allen Exhibit Number 79
15 for identification.)
16 A I think this must have been when I came back,
17 around the 22nd — around the 23rd.
18 Q That assessment of Furmark, was that yours or
19 Casey's?
2 0 A No, that was Mr. Casey's. And we briefed, Mr.
21 Cave and I briefed Mr. Furmark at 9:00 — Mr. Cave and I
22 briefed Mr. Casey on our conversations with Mr. Furmark
23 at 9:00 on 23 October 1986.
2 4 Q Okay, we'll move right along here. Let me
2 5 show you another set of notes which is headed Roy
842
fk
606
1 FumarJc/N^w York, date of birth 9/28/31. That will be
2 Exhibit 80.
3 (The document referred to was
4 marked Allen Exhibit Kumber 80
5 for identification.)
6 (Pause.)
7 If you could identify those notes?
8 A Those are the notes — I believe those are the
9 notes I took on the 16th of October.
10 Q These would have been the notes you would have
11 taken when you were meeting with Furmark at the EOB?
12 A That's correct, sir. Yes, I would say that
13 this is absolutely the case.
14 Q Okay, good. Thank you.
15 Let me show you notes that are dated October
16 22, 1986, and I think these are probably your notes on
17 the meeting you and Cave had with Furmark up in New York.
18 (The document referred to was
19 marked Allen Exhibit Number 81
20 for identification.)
21 A That's correct. I jotted down some notes at
22 dinner using the notepad of the Roosevelt Hotel, and
2 3 those are the notes, as I recall them — as I recorded
24 them at that time, rather. And then Mr. Cave used these
2 5 notes to put together the memorandum that was sent to
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607
1 Mr. Casey;
2 And that's when Mr. Furmarlc stated that
3 Ghorbanifar believed that the $15 million went to
4 Nicaragua and Mr. Ghorbanifar was relieved when $100
5 million was passed by the Congress.
6 Q So the first time that you were advised or
7 heard that Furmark believed there had been a diversion
8 was at this October 22 meeting; is that right?
9 A That, to the best of my recollection, is the
10 case. I do not believe he mentioned that on the 16th of
11 October; otherwise I would have recorded it. It came as
Y
12 no great surprise to me that he would asset that on the
13 22nd.
14 Q Now there are references in these notes to
15 Cyrus Hashemi. Do you recall being told by FurmarJc that
16 he was aware that Hashemi had been involved in an effort
17 in the summer of 1985 to begin the Iranian initiative?
18 A I recall something along those lines, that he
19 claims that Cyrus Hashemi was involved at some point and
20 knew Oiorbanifar. I don't recall the details of that.
21 And whan I met with Mr. Furmark, I guess around November
22 7, he also mentioned, just as he left to catch a plane,
23 something about Cyrus Hashemi being involved.
24 And he said that of course Cyrus Hashemi was
25 not a trustworthy individual and look what happened to
WDSSSIflf
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1 him. And I said I knew he died but beyond that I don't
2 know.
3 Q Specifically the reference that I clipped
4 talks about Hashemi and what he was offering back in '85,
5 that he would deliver the hostages if his indictment was
6 lifted.
7 A That's right.
8 Q And that then in August of 1985 Khashoggi and
9 Hashemi and company parted ways. When those references
10 were made, did that refresh your recollection of
11 knowledge that you would have had from a year previously
12 about this contact?
13 A No. I knew nothing about Hashemi being
14 involved in anything in 1985, at least I don't recall any
15 knowledge.
16 Q Did Casey at any point relate to you the fact
17 that he had been contacted by Hashemi in July of 198 5?
18 A I think he mentioned it to me when we were
19 trying to reconstruct the chronology, that there was a
2 0 man named John Shaheen and Cyrus Hashemi was involved,
21 y«a. He recounted all of that to me in his suite of what
22 was occurring in the summer of '85, but that was my first
23 detailed knowledge of that.
2 4 Q That conversation with Casey would have taken
25 place after October 22?
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A . Yes. That would have been sometime in
November or early December when we were trying to
reconstruct what really had happened over the last couple
of years.
Did you ever have occasion to find out what
role in the Hashemi initiative had been?
No. I don't )cnow what his role was.
You never discussed that?
I've never discussed that with!
In terms of the October 22 meeting, Cave
prepared a memorandum for Poindexter on that meeting.
(The document referred to was
marked Allen Exhibit Number 3 2
for identification.)
A We discussed that on the morning of the 2 3rd
about we needed — that this was incredibly sensitive.
We needed perhaps to compose only one copy, an original
and a copy, and that we would keep the copy in my office.
And the Director says prepare the memorandum to
Poindexter for my signature.
And that's what occurred. ^^^^^^^^^
Fand I
gave my notes to Mr. Cave, and I certainly support the
substance that's in this memorandiim.
Q Now you also met again with Mr. Furmark in
846
IE
610
1 early Kovember, on November 6.
2 A That's correct.
3 Q What caused you to have that meeting?
4 A He called and said it's urgent that I see you.
5 I want to fly dovm and talk to you briefly about the
6 situation. He said it's getting totally out of hand. I
7 said fine, I'll be happy to talk to you. And I met him
8 at the Key Bridge Marriott, listened to what he had to
9 say.
10 He at this stage named the Canadians,
11 allegedly the Canadians involved in pressuring Khashoggi
12 on the matter. He spoke about the urgent need to do
13 something to salvage the situation. He brought along a
14 headline that indicated that the U.S. Government had
15 contact with Iran. This was after the article had
16 appeared in Al-Shiraa on November 3.
17 I listened to all of this. I recorded this in
18 a memorandum that you have. At that stage it just seemed
19 to me not all that significant because the whole thing,
20 the boil was going to be lanced very quickly.
21 Q Let me show you what appear to be your notes,
22 November 6, 1986, which will be Exhibit 83.
23 (The document referred to was
24 marked Allen Exhibit Number 8 3
25 »■.. for identification.)
u^m
847
110
1 (Pause. )
2 A Those are my notes from the meeting with Mr.
3 Furmark. It was in the afternoon of November 6.
4 Q There are a couple of things I wanted to talk
5 to you about there. In paragraph III, I guess it is —
6 IV, excuse me — there is a reference to the Canadians,
7 $10 million, and it says "pay $10 million into G's
8 account." And then what appears to be the account
9 number is listed.
10 A That's correct.
11 Q In terms of what Furmark was telling you, was
12 he telling you that the price for Mr. Ghorbanifar was $10
13 million?
14 A I think he was saying that a way to salvage
15 this is to, without suggesting how the money would be
16 raised, what would be the source of the money, that the
17 way to salvage this situation that Ghorbanifar 's Swiss
18 bank account had been blocked, this was the number, that
19 if the money was paid into this number at Credit Suisse
20 that the money would go to the people to whom money was
21 owed, and somehow somebody should do this straight away.
22 I just simply wrote that down as fact. 1
23 think I recorded at least — I think it's recorded in the
24 memorandum for the record. He laid it straight out.
25 Q So essentially what Furmark was suggesting was
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1 that the price of silence was $10 million into this
2 account?
3 A I think he was implying it, in all candor.
4 Q He went into some detail, apparently, with
5 regard to the diversion of money. You all discussed this
6 as set out in your typewritten memo.
7 A Yes. He talked about there was a diversion.
8 Q In terms of the proprietary that was being
9 used, your notes reflect Lakeside. The earlier note from
10 Casey had used Lake, I believe. Lakeside was the name of
11 the proprietary given to you by Mr. Furmark; is that what
12 was happening?
13 A Yes. But I think he was wrong. X think it's
14 Lake Resources, based on what I've learned since. He had
15 the name incorrect, and he kept repeatedly misstating the
16 name.
17 Q You've got a note here. He described Miller
18 as being froB Toronto, real sleazy and corrupt. Did he
19 tell you anything that caused him to reach those
20 conclusions, what facts he was relying upon?
21 A No, he didn't, but that was his description —
22 that this individual was a very difficult individual, as
23 I recall. But he didn't offer any rationale.
24 Q Did he indicate to you that he had met them?
25 A It was my impression that he had, that they
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1 vara assoeiatas and they had been associated in business
2 transactions with Adnan Khashoggi and that he had had
3 contact, directly or indirectly, with them. He implied
4 he knew who they were and that they were not the most
5 pleasant types, yes. I would say that he implied he knew
6 them .
7 Q Why don't I show you Exhibit 84, which is your
8 memo of November 7? If you will just identify it and
9 we'll pass it along.
10 (The dociimant referred to was
11 marked Allen Exhibit Number 84
12 for identification.)
13 A That's a memorandum that I prepared on the 7th
14 after meeting Mr. Furmark on the 6th of November, 1986.
15 Q And that memo is based on the notes we just
16 saw as Exhibit 83?
17 A Absolutely, and no one aver gave ma any
18 reaction to the mamorandiun . I sent it to Mr. Gates and
19 to Mr. Casay.
2 0 Q Let ma show you one other memorandum that's
21 dated Novambar 3, 1986, regarding the Frankfort meetings
22 that were going on at that period of time. That would be
23 Exhibit 85.
2 4 (The dociiment referred to was
25 /filA. marked Allen Exhibit Number 85
//AlAf marked f
850
614
1 for identification.)
2 Can you tell me why that memo was prepared by
3 you?
4 A It was not prepared by me.
5 Q Okay, sorry.
6 • A It was prepared by Mr. Cave, I believe, and my
7 secretary, in typing it up, accidentally put my name on
8 it.
9 Q So that's not your work product?
10 A No, sir.
11 Q My understanding is you were not at those
12 meetings, correct?
13 A That is absolutely correct. It's an
14 interesting memorandum, but I am not the author.
15 Q Now after the November 6 meeting with Furmark
16 did you have occasion to meet with him again?
17 A No, sir.
18 Q Did you have occasion to talk to him again?
19 A Yes.
2 0 Q When?
21 A He called me for some reason in late February
22 or early March of '87, after the publication of the Tower
23 Commission.
24 Q Do you have any recall of what he discussed
25 with you?
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1 A . It was some complaint that he had in the
2 memorandum that was prepared by Mr. Cave following our
3 meeting on the 22nd of October, where there's some — I
4 need to have that memorandum back, but there was some
5 allegation in there that bothered him. He said it wasn't
6 true and he could not understand why that was included.
7 He said, I believe, in paragraph four that
8 with regard to this deal the financiers, Ghorbanifar and
9 Nir met and agreed that $3 million would be added to the
10 price to cover profit and expenses and also another $2
11 million would be added to cover monies owed to Mr. Nir.
12 And he claimed ha never made this statement about the $2
13 million and he wanted to know how to correct the record.
14 I said why don't you write Senator Tower?
15 Q We have one other document I need a little
16 help with. It has DCI 20 November 86 written on it. I'd
17 like you to look at it and tell me if you can place this
18 document in time. I eun primarily interested in the
19 materials that appear on the bottom half of the page.
20 (The document referred to was
21 marked Allen Exhibit Number 8 6
22 for identification.)
23 (Pause.)
24 A This was about the time, I guess, Mr. Casey
25 was preparing to give his testimony before the House and
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616
Senat» Select Conunittees on Intelligence.
Q I believe that occurred about the 21st.
A I was with Mr. Casey that day. I was called
unexpectedly by Mr. Secord that day, who said that he had
personally spoken|
He went to see him on Sunday,
Th^le^eT'sunday was, prior to, say, the 20th of November,
and that ^^^^^Hwas supportive of the United States'
efforts to reestablish some contact with Iran, and that
^^^^^Hendorsed the methods and the objectives of the
initiative.
It seemed to me — and why General Secord
called me, I don't know, except that he clearly wanted to
say that he was trying to salvage something that seemed
to me at that stage hardly salvageable. And I wrote it
down.
Q Did he give you any further reason on why he
thought anybody would be interested ^"^^^H^^^B
rooting for the initiative at that point?
A Well, it was the belief, I think, even at that
stage that the second channel was so good it should be
kept open at all costs and that the Department of State
and others were trying to shut it down, and he thought
that was wrong, given the labors of the past 14 or 15
months. 1 1 Si .^ I
853
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617
1 Q I have run past the allotted time. I just
2 wanted to ask you a couple more questions to clear things
3 out in terms of the testimony that was prepared for
4 Director Casey.
5 Casey flies in from Central America.
6 A Yes.
7 Q And begins the process of trying to prepare
8 for his testimony. What role did you play in either
9 directly preparing Casey or reviewing the materials that
10 were utilized for his testimony?
11 A I, along with other senior officials,
12 participated in the review of some of the drafting that
was done. McCullough.^^^^^^^^^^Hsf the
14 Directorate of Operations who worked in the front office,
15 and others started preparing some of the basic drafts.
16 That particular weelc that he was to testify, we had a
17 meeting, I guess, and I forget who chaired the meeting, a
18 preliminary meeting earlier in the week to start pulling
19 together all the data because we had the Inspector
2 0 G«n«ral, w* had the General Counsel, we had several
21 people trying to pull together chronologies.
22 I was being asked by^^^^^^^^and others to
2 3 contribute to chronologies, Mr. McCul]
^^^^^^^H I did that. So I was pulling together,
2 5 adding to chronologies, looking at the testimony. We had
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t^?<|D|^iali 618
1 a meeting, I believe — and perhaps Mr. Gates chaired the
2 meeting — to set the stage for preparing the testimony.
3 And then Mr. Casey chaired a meeting, I guess it was on
4 Thursday night before he went up on Friday, where he met
5 with about 20 of his top officials — I, among others,
6 was there — who had had some )cnowledge or part in the
7 initiative.
8 I ]cnow we had two meetings that week, and it
9 was amazing our inability to put in precise terms just
10 when certain events occurred, because there had been no
11 so-called diary kept. This was not necessarily our
12 operation. We supported it. Various segments of the
13 Agency supported it. So 1 contributed to it in that
14 sense.
15 The following week I was asked by Mr. Casey
16 and Mr. Gates directly to put together the master
17 chronology, which I did, which formed the foundation for
18 the Inspector General's final chronology that was passed
19 to you and to the Intelligence Committees.
20 Q Let me focus specifically on the November HAWK
21 flights into Tehran.
22 A Yes.
23 Q You had been a participant in that matter.
24 You had received the Ledeen briefing of December 4, which
25 certainly brought you current in terms of what was in
855
yma
619
1 tho8« planes and what had happened in that circumstance.
2 Were you not troubled by the testimony that
3 was to be given to the House and the Senate on the 2l3t
4 of November that described the events in November?
5 A What we )cnew contemporaneous and what we )cnew
6 ■ after the fact are two different things. I think I've
7 already testified under oath and earlier in my deposition
8 that, one, I thought that our first concrete Icnowledge
9 that we had it was HAVnc missile parts, to my knowledge,
10 was when Ghorbanifar told me on the 13th of Januairy.
11 Clearly 1 was in error because Kr. Ledeen told
12 me on the 3rd of December what was there. I didn't have
13 that memorandum that I had written. I don't know where
14 the memorandum was. Maybe it was in my files somewhere.
15 I have so many memorandums. We were struggling to find
16 out when we knew precisely HAWK missiles were on board
17 that flight.
18 I have testified under oath again and again
19 wh«n we knew precisely HAWK missiles were on board that
20 flight. I have testified under oath again and again that
21 when I arrived at the office, too>
22 down to Mr. Clarridge two floors below my office and
him^^^^^^^^^^^fand he was already involved,
24 clearly, in sending messages overseas, that Mr. Clarridge
25 had been told it was oil drilling equipment.
856
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colonel North showed up sometime during the
morning and said here-s oil drilling equipment and w.
need to move it into Tehran. We can't do it the way we
would like to do it, and we've got to have an airline
available immediately because this is very important. He
called the National Security Advisor and the Deputy
National Security Advisor in my presence. I had, as I
have testified, very grave doubts that that was oil
drilling equipment, but I didn't know for certain.
And colonel North stated emphatically that it
„„. I felt if there were shipment^ccurrin^^ga.
colonel North was using a cover story and had
THTTuthorized to do so by the National Security
Advisor. It was very difficult for me to challenge that
at that moment.
2nthjnightof25^^jovember,
And I remember when we congregated, I guess on
CTVOaDEVlORD
857
RET/ CODEWORD 621
1 Monday or Tuesday, and it must have been on Monday
2 evening because I missed my planning commission meeting —
3 I do have another life — that we talked about this, that
4 by the 2 6th of November we were pretty certain that some
5 form of arms was involved, but I didn't recall that we
6 knew precisely it was HAWK missiles. That is, I did not
7 personally know it was HAWK missiles until January 13.
8 And I can't recall what the Director's
9 testimony precisely said on the 21st, at this stage.
10 Q Well, were you aware of the controversy and
11 Mr. Sofaer and Mr. Cooper being concerned?
12 A No.
13 Q You weren't present at that meeting the next
14 morning on the 21st?
15 A Not at all. I knew nothing about that until
16 bits and pieces I have picked up in recent days.
17 Q Were you present when the Director actually
18 testified?
19 A Y«a.
20 Q His testimony before the House doesn't have
21 th« deletions that Cooper took out. His testimony before
22 the House says in essence we were told it was oil
23 drilling equipment and that's what he's representing to
24 the House of Representatives. That didn't concern you
25 all, that the representation was made to the Housa of
iii
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DHeUSSiEB
622
Repraaantatives?
A That's what w« vara told. Mayba that's a
legal fine point, but that's what tha NSC told us.
Clearly we knew later, and I thinJc in tha testimony we
}cnev later it was HAWK missiles.
Q The testimony suggests that you all didn't
know it was HAWK missiles until sometime in January.
A That's what I'm saying. And whan we were
struggling to know tha pracisa cargo I probably am
responsible as anyone — and I'll take that
responsibility. Twenty of us sat around tha table and we
were trying to recall precisely whan wa knew HAWK
missiles were aboard. But I stated at that meeting,
whenever it occurred — on the Monday — that wa knew
soma form of armaments probably were involved by the 2 5th
and 26th.
But I had forgotten that Ledeen had told me
aaphatlcally what was aboard on tha 3rd of December. I
had totally forgotten that.
Q Let ma coma at it another way, Mr. Allen. You
heard Casey's testimony. Did you hear both tha Senate
and tha House testimony?
A Yes.
Q Did you come away from that testimony troubled
859
CRET/ CODEWORD 623
1 that Casay had mislead th* Senators and Congressmen or
2 not?
3 A I didn't think he had misled them at the time.
4 I think w« were scrambling to try to reconstruct. I
5 don't want to sound disrespectful, but there were so many
6 things overwhelming normal senior Agency officials, and
7 this was held so compartmented and so fragmented the fact
8 that errors were made, mistakes were made, and
9 misstatements were made does not surprise m«.
10 But Z do recall a very detailed conversation,
11 I believe on Monday and then again on Thursday, as to
12 just when we knew precisely — when we knew precisely,
13 when Ghorbanifar himself told me at Mr. Ledeen's house
14 that HAWK missiles were on board. We thought it was
15 January 13. Clearly we were totally wrong.
16 You showed me in my last deposition a
17 memorandum that I had forgotten that I knew as early as
18 the 3rd of December, and that memorandum went to a number
19 of people. That went to the Director and the Deputy
20 Director. It went to McMahon. It went all over.
21 Q It's my understanding that it came to the
22 attention of the Director the night of the 20th, that Mr.
23 Sporkin was also knowledgeable of the fact that weapons,
24 missiles, had been on that flight on November 25, that
25 that was brought to the attention of Mr. Dougherty and
TolSMAi/j
860
0&M^
624
1 that Dougherty suggested that was a reason for modifying
2 the testimony that evening.
3 Was Sporkin's knowledge brought to your
4 attention during that period of time, November 2 0-21?
5 A No. I didn't know he had contemporaneous
6 knowledge. I knew after the fact, when he was briefed on
7 the shipment, that he said this was a covert action and
8 perhaps some ex post facto Finding needed to be made on
9 this.
10 Q The Finding goes up November 26. It's quite
11 specific in trying to retroactively take care of the
12 initiative. Sporkin and Makowka apparently told somebody
13 on the night of the 20th of November preparing for the
14 testimony that they recalled that they knew about
15 armaments being on that flight. But that message didn't
16 get to you that day?
17 A Which day are we talking about?
18 MS. MC GINN: Object to the form of the
19 question. Can you just clarify that what you are saying
20 is that Sporkin informed Mr. Dougherty or Mr. Makowka
21 that h« thought he remembered knowing about the weapons
22 after the flight took place? I think we're getting
2 3 confused here on what took place.
24 THE WITNESS: See, I'd be very surprised that
25 Mr. Sporkin knew contemporaneously on the day of the 24th
861
625
1 and 25th that HAWK missiles were aboard that aircraft
2 because he didn't even Icnow about the operation.
3 BY MR. KERR: (Resuming)
4 Q He ]cnew on the 25th.
5 A Yes, sir. He knew something had occurred on
6 the 25th — 26th.
7 MR. WOODCOCK: He was briefed on the 25th,
8 according to his testimony, that missiles were on board
9 the plane. He believes that he was told specifically
10 HAWK missiles at that briefing, and that would be
11 November 2 5, '85.
12 THE WITNESS: I never heard that. I don't
13 know anything about that.
14 MR. WOODCOCK: And he Is supported In that by
15 Ed Dletel, who was present at the same briefing, and
16 Makowka, who then followed Into the briefing and was told
17 by Sporkln and Dletel that It was missiles. This is
18 November 25.
19 BY MR. KERR: (Resuming)
20 Q What I'm trying to focus you on Is what you
21 kn«v in preparing for Casey's testimony. Casey's
22 testimony on this point isn't even close.
23 A I knew that HAWK Missiles, but at the time
24 that the flight was being arranged and the flight was
25 under way I had deep suspicions that Colonel North was
tI
ttwrariFH
862
afflElEL
626
1 not honest with us, that he was, for his own reasons,
2 giving us a cover story. I believe that Mr. Clarridge
3 and I discussed that.
4 But when we prepared the testimony we probably
5 could have done a better job in how we phrased it. But I
6 thought that, you know, I didn't know what Mr. Dietel and
7 Mr. Sporkin had been briefed on the 2 5th of November,
8 1985. I know that when we were preparing the testimony
9 prior to 21 November 1986 there were a lot of imperfect
10 memories and a lot of struggling to try to get it very
11 accurate that week.
12 And if Mr. Casey misspoke or misled the Select
13 Committees he did it because his staff didn't do a good
14 job. That's my belief.
15 Q You are not conscious of a decision being made
16 at the higher levels of the CIA to give this testimony
17 that knowledge happened in January even though you all
18 knew that that was not the case?
19 A You're going to have to restate that one
20 b«caus« this is a fairly serious question.
21 Q The testimony that was given to Congress
22 suggested that in January of 1986 is when the Agency
23 learned for the first time that there were HAWK missiles
24 aboard this flight. That's the testimony that came
25 across to Congress.
TOP SI
■mWiFIED
863
"|i
627
1 A That's correct.
2 Q You ara not awar* that a dacision was made by
3 people at Casey's level to give such testimony even
4 though they )cnew it not to be true?
5 A No, I'm not aware that anyone tried to
6 deliberately mislead the Congress — either Mr. Casey or
7 any of his senior officials. I have no toowledge of
8 that. We honestly were 8truggling|
10 ^^^^^^^^^^^^^^^^khis was not oil drilling equipment,
11 but I don't Icncw S7 any deliberate decision by Mr. Casey
12 or any senior Agency official to mislead the Congress.
13 Q We have a chronology prepared prior to his
14 testimony by the CIA which quite clearly indicates that
15 the shipment of November 1985 was a shipment of munitions
16 at the initiative of NSC. Someone at the CIA prepared
17 that chronology, and yet Casey's testimony doesn't
18 correspond to that.
19 Do you have any )cnowledge of how the
20 chronologiea got changed or altered during that period of
21 time?
22 MS. MC GINN: Object to the form of the
23 question. First of all, that chronology does not state
2 4 and you cannot show us any chronolocfy that states that
2 5 they )cnew contemporaneously that those shipments were
864
1 HAWK Bvlsslles. Any chronologies that were prepared were
2 prepared In the November 1986 time frame. What they )cnew
3 in November 1986 is very different from what they )cnew in
4 November 1985.
5 MR. KERR: Certainly what the CIA has been
6 telling us they )tnew is very different.
7 MS. MC GINN: That's the testimony and that's
8 what the facts indicate.
9 MR. KERR: No, ma'am. That's not what the
10 facts indicate.
11 MS. MC GIKN: Well, you show me a chronology
12 that indicates —
13 MR. KERR: We will show you a report that goes
14 through in soma detail what the facts really indicate.
15 MS. MC GINN: We look forward to that. But
16 you show right now, if you want him to answer that
17 question, you show him a chronology.
18 MR. KERR: I'll ask him to answer the
19 question. If you tell him not to answer it, you can deal
20 with the Committee on that.
21 MS. MC GINN: I objected to the question, and
22 if hra wants to answer it under those confused
23 circumstances, he can answer it. Do you understand the
24 question?
25 THE WITNESS: I've lost the question. I've
'Wl'/BSfFB
865
1 lost Ui« whola train almost.
2 BY MR. KERR: (Reauning)
3 Q With regard to th« chronologias that were
4 b«ing pr«par«d during th« Nov«mb«r 19, 20, 21 period of
5 tim«, did you review those chronologies as they were
6 . prepared?
7 A I contributed to thea. I know that
^^^^^^Hand^^^^^^^^Hand others scrambling
9 around to put together a chronology. I Icnow that the
10 Inspector General had started a chronology and the Office
11 of General Counsel had started a chronology. And I
12 contributed some of my toowledge as to the chronology, of
13 what had occurred at the beginning of the initiative up
14 through the November 1986 time frame.
15 So there were a series of chronologies being
16 prepared by a variety of people. No one was
17 strategically in charg* overall, and that was one of the
18 problem* that when w« met in the Director's conference
19 room on two occasions that we earnestly were struggling
20 to get the chronology correct.
21 And I recall considerable conversation of when
22 we Jcnew explicitly what was on board that flight. But on
23 the chronologies that were prepared prior to the
24 Director's testimony on the 2l8t I was not in charge of
25 it. I contributed to it, and I can't remember which
82-688 0-88-29
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pi»c«« I nec«ssarlly contributed!
But th« next w«ek Mr. Gates called and said on
behalf of Mr. Casey I should put together the master
chronology and I did put together the master chronology.
And I think it was a very fine chronology. But neither
Mr. Casey nor any senior official, to my knowledge, ever
made a decision to mislead — to the best of my
knowledge, to mislead the Congress on what was on that
flight.
If there's confusion, boy, confusion abounded
at the Agency that week.
Q With regard to Mr. Clarridge, did he too play
a role in drafting that chronology during that period of
time?
A He sat in on the two meetings, sir.
Q But teUcing pen In hand or writing?
A I never saw him take pen in hand. He talked
about — I was witness to the fact that Mr. Juchniewicz
was there for at least the first meeting and Mr.
Clarridge, and they had different recollections over just
how that NSC request occurred and to what degree was Mr.
Clarridge authorized to conduct the activity.
There was a lot of confusion. There was a lot
of sincere men trying their very best at that time.
867
631
1 Q Was ther« one person that had responsibility
2 for putting that chronology together, who had overall
3 responsibility for it?
4 A Well, I think that was part of the problem. I
think^^^^^^^^^^^^^Hwas taking bits
6 along with Mr. McCullough, in trying to put together the
7 best chronology. The Directorate of Operations took the
8 initial effort of the chronology, but then the Inspector
9 General had a responsibility, the General Counsel. So
10 there were a series of chronologies begun.
11 I'm afraid we did not perfora with real
12 professionalism that week. It just took us another week
13 or so to get a very detailed chronology down. I wrote
14 the baseline chronology on which the Inspector General
15 built a very detailed chronology, but, you know, I would
16 be very surprised if Mr. Casey or any senior official
17 advocated misleading the Congress on what was in that
18 shipment.
19 But I knew there was considerable confusion at
2 0 the two meetings that I attended where you had 20 —
21 maybe 15 to 20 — people struggling to get the thing
2 2 right. And I don't think we got it right.
2 3 Q You were not aware of Colonel North playing a
2 4 role in adjustments being made to the CIA chronology
2 5 during that perioc^?. ^ . _
TOP N., ...
868
632
1 A I heard something about that from Mr. Gates,
2 but I had no direct toowledge. I saw a version which was
3 probably in my files of the chronology that was being
4 developed at the NSC. I thinlc I have a copy of something
5 called a maximum version. There is probably something in
6 my files. Some of that did not track with my knowledge,
7 particularly the shipment in August and September of '85.
8 It didn't seem correct to me. It was a draft.
9 Q But in terms of who at the CIA was getting
10 that information from NSC, can you identify that person
11 for me?
12 A Mr. Cave was down there working with Colonel
13 North at the time. He brought back the version that was
14 put in my files.
15 Q Was it your impression he was the contact
16 point for NSC input on such a chronology?
17 A No. I don't think he was necessarily the
18 input at all, not the contact. He was dotm there, and
19 the only part that he could contribute to the NSC
20 ohronology was after the 5th of March when he joined the
21 op«ration. He had no contemporaneous knowledge of what
22 occurred in 1985 and could in no way be held to what was
23 prepared.
24 Q What did Gates tell you, if you can recollect
25 it?
869
18
633
1 A H« told m« that he had challenged Colonel
2 North at a meeting at the White House that had to do with
3 some parts of the chronology prepared by the NSC, which I
4 guess related to the use of the proprietary aircraft, and
5 he challenged Colonel North and Colonel North changed it
6 to the way Kr. Gates — Mr. Gates will have to tell you
7 explicitly what it was.
8 MS. HUGHES: Could we go off the record for a
9 minute?
10 (A discussion was held off the record.)
11 (Whereupon, at 7:15 p.m., the talcing of the
12 instant deposition recessed, to reconvene at 10:30 a.m.,
13 Thursday, July 2, 1987.)
14
15 Signature of the Witness
16 Subscribed and sworn to before me this day of
17 , 1987.
19 Notary Pxiblic
20 My Coaaission Expires:
870
ONCLASSlHtU
CERTIFICATE OF REPORTER
I, NICHAL ANN SCHAFER, th« Officer before whom the foregoing
deposition was taken, to hereby certify that the witness
whose testimony appears in the foregoing deposition was duly
sworn by me; that the testimony of said witness was taken by
me to the best of my eUaility and thereafter reduced to
typewriting under my direction; that said deposition is a
true record of the testimony given by said witness; that I am
neither counsel for, related to, nor employed by any of the
parties to the action in which this deposition was taken, and
further that I em not a relative or employee of any attorney
or counsel employed by the parties thereto, nor financially
or otherwise interested in the outcome of the action.
Notary Public
in and for the District of Columbia
My Cooaission Expires: February 28, 1990
UNCUSSIflt
871
TOP liltWSIEtlDEWORD
Scenograph; : Transcript of
HEARINGS
Before the
"srrs.__:^
/87
SELECT COMMITTEE ON SECRET MILITARY ASSISTANCE
TO IRAN AND THE NICARAGUAN OPPOSITION
UNITED STATES SENATE
CONTINUED DEPOSITION OF CHARLES E. ALLEN
Thursday, July 2, 198?
Partally Declassified/Released on
1-20-^
under provisions of E.O. 12356
by N. Menan, National Security Council
Washington
TOPS
ORD
(202) 523-9300
20 F STRZZT, M.W.
COPT PIO-
_COP»ES
872
1 CONTINUED DEPOSITION OF CHARLES E. ALLEN
2 Thursday, July 2, 1987
3 United States Senate
4 Select Comnittee on Secret
5 Military Assistance to Iran
6 and the Nicaraguan Opposition
7 Washington, D. C.
8 Continued deposition of CHARLES E. ALLEK,
9 called as a witness by counsel for the Select Committee,
10 in the offices of the Select Committee, Room SH-901, Hart
11 Senate Office Building, Wo-.shington, D. C. , comEencing at
12 10:35 £.m., the witness having been previously duly sworn
13 by MICHAL ANN SCHAFER, a Notary Public in and for the
14 District of Columbia, and the testimony being taken down
15 by Stenomask by RAYMOND HEER and transcribed under his
16 direction.
Partially Declassified/Released on
under provisions of E.O. 12355
by N. Menan, National Security Council
}immm
873
umssMo
635
1 APPEARANCES :
2 On behalf of the Senate Select Conunittee on Secret
3 Military Assistance to Iran and the Nicaraguan
4 Opposition:
5 CHARLES KERR, ESQ.
6 TIMOTHY WOODCOCK, ESQ.
7 On behalf of the Central Intelligence Agency:
8 KATHLEEN McGINN, ESQ.
9 RHONDA HUGHES, ESQ.
UNGl^Sm
874
UNElAfflB
636
1 CONTENTS
2 EXAMINATION ON BEHALF OF
3 WITNESS SENATE HOUSE
4 Charles E. Allen
5 By Mr. Woodcock 637
6 EXHIBITS
7 ALLEN EXHIBIT NUMBER FOR IDENTIFICATION
8 87 645
9 88 645
UNOASSiED
875
BNOUSSW
637
1 PROCEEDINGS
2 Whereupon,
3 CHARLES E. ALLEN,
4 called as a witness by counsel on behalf of the Senate
5 Select Committee and having been previously duly sworn by
6 the Notary Public, was further examined and testified as
7 follows:
8 EXAMINATION
9 BV MR. WOODCOCK:
10 Q Why don't we go on the record? Mr. Allen,
11 this is a continuation of our deposition, which now has
12 been going on for three days over, I guess, about an
13 eight-week period now. I want to remind you, as I think
14 you know, that you are still under oath in this
15 deposition.
16 Mr. Allen, as I explained before we started, I
17 am going to be covering some scattered topics that I have
18 made notes on in the course of Mr. Kerr's examination of
19 you.' Let m* begin by asking you with respect to George
20 Cava, George Cave became involved in this operation
21 around March 4 or 5, 1986; does that square with your
22 recollection?
23 A That is correct. As I understand it, it was 5
24 March 86 that he became involved in the operation.
2 5 Q Now what was Mr. Cave's relationship to you?
UmSSIFIfD
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H«r« you hlfl suparior or how did that work?
A Ko, I was not Mr. Cave's superior at all.
In January, who was thenV
of the Directorate of Operations,
stated that he thought It was Important to bring on the
Farsl speaker and an expert on Iran, and he mentioned
Mr . Cave .
After the meeting, I believe, that
attended In February where I believe perhaps even Mr.
Hakim was Interpreter ,(^^^^^^H^| pressed to have his
own Agency expert in the operation. So Mr. Cava reported
throughV^^^^^^H and up to Clair George and up to Mr.
Casey. He did not have a desk in the Directorate of
Operations, and because the Intelligence that we
collected on a daily or certainly a weekly basis was of
value to Mr. Cave as he undertook his work, he tended to
work out of ay office.
At that time we were relocating.
Then I moved into my own
private office. Mr. Cave tended to work in my office or
at a' desk that belonged to me just outside my office, but
his reporting chain was clearly through^^^^^^^^l
Q Now let me clarify your testimony from the
preceding day. _ You testified, I guess it was on Monday,
UNKASHD
877
UNSU^M
639
1 that you war* not awara of Albert Hakim actually having
2 attanded the February 2 5 meeting until sometime long
3 after the meeting. Is that correct? Did I understand
4 that correctly?
5 A To the best of my recollection — and I must
6 testify to my recollection — I did not recall the name
7 Hakim being involved in the February session at all.
8 However, I became aware of Mr. Hakim in March or April
9 when he made this direct call to the senior official in
10 Tehran
11 and I was told that Mr. Hakim at that time was an Iranian
12 expatriate living in this country who in some manner was
13 related to the initiative and to Colonel North.
14 But I did not focus on his role at the time,
15 and it wasn't until the summer of 1986 in, I guess, July
16 that I bec2une aware of just how significant a figure he
17 really was.
18 Q Did you understand when George Cave czune on in
19 early March that he was supplanting someone?
20 A No, I did not understand that at all. I
21 thought he was coming in as a CIA officer in whom we had
22 confidence to serve as a Farsi linguist and also, I
as ^^^^^^^Hsaid, to serve
24 negotiator but as an advisor to the NSC or to assist the
25 NSC in the initiative.
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Q When Mr. Cave came on were you present at any
of the briefings that were given of him or for him?
A I don't think I was present at any of the
briefings. However, ^jj^^^ either saw me or called
me and said it was important that I sit down with Mr.
cave and explain what my role had been in intelligence
tasking, direction,
And that I did.
AndT of course, Mr. Cave then continued to —
he spent some time over in the^Division, but he spent
a lot of time working out of my own office.
Q Let me shift to another topic. You were head
of the DCl Hostage Location Task Force that was
established in late 1985; is that correct?
A That is correct.
Q That Task Force focused at one point, did it
not, on securing the release of Peter Kilboume; is that
A It was aware of the Peter Kilboume operation
and we reported on the Peter Wtb^wne operation from
time to time to Admiral Poindexter
879
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uNcusn
H« report ad and analyztd th« Kilbourw cas* on
a weekly basis, and sone of our reports vent in to
Admiral Poindexter on that case. That case was under way
when the Hostage Location Task Force was formed.
Q
Q So I gather from your testimony that in that
undertaking you did not as the DCI Hostage Location Task
Force have emy direct responsibility for it, but it was
more intelligence gathering and support?
A Support, analysis as to what was happening,
reporting to Admiral Poindexter and Colonel North on the
progress of the operation.
tmm
880
9
Now was there anything in particular about
Now was there anything
DHiitftSW
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Kilb^um^ himsalf or was it simply this person's contacts
that caused the effort to focus on Kilbj^urn^?
A Kilb^urne was looked upon as another hostage
and Colonsl North always indicated that ve treated all of
these hostages equally in our attempts to free them. We
always felt that Kilb^urne was held by a different group,
and I think that is convincingly the case — more of a
criminal group, perhaps in collusion with some Syrian
non-commissioned officers.
But we worked on it just as we worked — in
the spring of 1986, w« had thought ve knew where the rest
of the Americans vero, bas^d en other reporting, and we
worked very hard on th^it as well,(
Q Nov let ae shift to the area of the second
chiihnel. The second channel began, I gather, through the
efforts of General Secord and Albert Hakim; is that your
understanding?
A That is correct.
Q When were you aware that the second channel
contacts were really under way?
A I was aware in the August time frame that
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contacts war* under way with a new group of Iranians,
probably in the second half of August. I was aware that
there had been contacts in New York between Mr. Cave, I
believe, and Mr. Hakim and the individual'
with whom Mr. Hakim had been in contact. And I believe
that a polygraph was conducted of this contact which
proved good.
Therefore, there were initiatives under way in
the July time frame that I was generally aware of, and I
was more aware after the meeting of 15 August in
Brussels.
Q Now to the extent George Cave was involved in
this, I gather he would have kept you contemporaneously
apprised?
A He generally kept me apprised of the second
channel. Clearly Colonel North was very cautious about
information on the second channel, and Z was not really
focused on the second channel until after he told ae on 9
September that this was very important, officially
aj^roved „
Q Let ma show you a couple of documents. I
don't know where we are in the Exhibit sequence at this
point.
(A discussion was held off the record.)
DNCmo
883
mMmi
645
1 (Th« documents r«ferrad to were
2 marked Allen Exhibit Numbers 87
3 and 88 for identification.)
4 BY MR. WOODCOCK: (Resuming)
5 Q Now, Mr. Allen, if you would take a moment and
6 read each of these and first let me know if you recognize
7 either of them or both of them.
8 (Pause.)
9 A Just before I read them carefully, I have seen
10 both of these memorandums in the past, in the summer of
11 1986.
12 Q Now we have the testimony of George Cave to
13 the effect that he wrote those memoranda himself and your
14 testimony is that you saw them in the summer. Do you
15 believe you would have seen them eibout the time they
16 would have been created?
17 A I remember seeing this one about the time this
18 was created and I remember having lunch with Mr. Cave and
19 he described his visit to New York. I believe this was a
2 0 visit that occurred in New York.
21 Q And by "this one" you are referring to the one
22 that is marked 87; is that correct?
23 A That is correct, yee. And I listened to Mr.
24 Cave describe his meeting and he felt that this
25 individual, I^^^^B) looked like a reliable individual
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UNCbASSIFKD
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and I racall that he was talking about setting up a
polygraph.
Q Did he tell you that he knew I
A I believe he said he knew hin or knew of him.
I can't recall precisely.
Q Let me ask you, then, if the July date on that
squares with your recollection of when you would have
become aware of the contacts that led to the second
channel.
A Yes, sir. It would be, and it would be
shortly after that. In fact, Mr. Cave and I had lunch
two or three times a week to talk over this activity.
When Mr. Cave was at the office he would usually stop by
and' if I did not have a luncheon appointment he said
let's go to lunch. And so we had a considerable time to
discuss about this.
Q Now I gather from your testimony that you were
contemporaneously aware of plans to place |
a polygraph; is that correct?
A Yes, I knew of that.
DNCtASStfiH)
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Q . Do you )cnow whether that was going to be an
Ag«ncy-conducted polygraph or, as I think it says in the
memo, a private polygraph?
A I think it was a private polygraph Mr. Hakim
was going to arrange, and I may be inaccurate on that
because I didn't get directly in involved in these kinds
of sessions, but I think it was, I thought it was a
private polygraph. I don't know whether the Agency ever
ended up polygraphing him or not. I just don't know.
Q I gather, then, from your testimony that you
received no confirmation one way or the other as to
whether the Agency itself had polygraphed this
individual .
A Mo. I don't recall. ^ But I recall Mr. Cave
indicating that he thought that(^^^^Bwould be a
reliable asset.
Q Based upon his own personal understanding of
the man; is that correct?
A Yes, that's right. And just to continue for
the record, I remember seeing the 11 July memorandum
sometime in July. Mr. Cave, when he wrote memorandums
UNWSW
886
UNStASSIFieo
648
1 Ilk* this, h« mad* a copy availabl* or ha actually put
2 his own original In ny flla.
3 Q Do you racall knowing at this mid-July period
4 of Hakim's plans to compensata —
5 (A discussion was held off the record.)
6 BY MR. WOODCOCK: (Resuming)
7 Q In reviewing Deposition Exhibit 88, do you
8 recall knowing at about that time, which would be about
9 July 11, 1986, that Hakim had some plans to compensate
10 ^^^^^Hfor his efforts In opening up the second
11 channel?
12 A I think there was some mention of that, but I
13 don't recall any specifics.
14 Q Did you have any understanding as to whether
15 that was going to be a flat payment or a promise for
16 (j^^^^HH/to participate in business ventures in the
17 future?
18 A It is the latter. As I recall, it had to do
19 with business ventures, and I think Mr. Cave commented
2 0 something along those lines.
21 Q Do you recall receiving any Information — and
22 let me now take you from this point, which would be July
2 3 11, to the end of the Iran initiative, when it became
24 exposed in November -- any point at which Mr. Hakim
25 complained that he was unable to satisfy demands from
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UNtlASSffi
649
lor any other Iranian contact who had facilitated
the opening of the second channel?
A There was some comment along those lines, and
can't recall who made the comment, that Mr. HaXim and
the relationship was not that warm and
there was some indication at one time that Kr. Hakim
wanted to cut (^^|^^^^^Hh sort of out of being a
participant in this activity. But I can't put a time on
this.
Q Do you know how that information came to your
attention?
A I can't recall, ^^^^^^^^
laybe Mr. Cave
mentioned that there were some problems, but I can't
recall.
Q In September you had some direct communication
yourself with Mr. Hakim.
A Yea, indeed I did.
Q Do you recall him telling you of these
problems?
A No, sir, he didn't, not to the best of my
recollection. This was Labor Day weekend. It was on a
Friday evening. I recall Colonel North calling me and
saying that Mr. Hakim believed that there was this
alleged diversion occurring of TOW missiles and that this
l)NetASStf1fO
888
mmm
650
1 would cartalnly undermln* the ability of th« U.S.
2 GovaxTunant to continua to provide an Incantlva for Tehran
3 to deal since there were several thousand TOWs allegedly
4 Involved In this.
5 And I had a series of conversations that
6 weekend and over the next several days which I summarized
7 In a memorandum that you have, around 2 September 198 6,
8 where the Customs and the FBI, I think, looked for
9 Information to substantiate Mr. Hakim's allegations, and
10 to the best of my knowledge they were never able to do
11 so, and I siimmarlzed all of this and gave the memorandum
12 to Colonel North.
13 Q Indeed, and we do have that memorandum. I'm
14 not going to ask you to repeat your testimony on that
15 topic. As the second channel developed in September, was
16 it your Impression that this channel promised a more real
17 political benefit than the first channel?
18 A I was ambivalent in September about the
19 reliability of the second channel.
20
21
^^^^^^^^HH^^^^^^^^^^^^ I guess we knew a
bit about the Individual ,(^^^^^^^^^^^m^^B but
24 we could not from our perspective say that this was a
25 very solid channel.
Iftyswo
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. But as September continued, after 9 September
Colonel North said that this was just an absolutely
reliable channel
And when I talked to Mi". Gatts on 1 October
about the reliability of the srcond channel I said it vas
yet to be completely authenticated, thet we really
couldn't say it was all that reliable, although there
w«r« some indicators along thosa lines.
Q Do you recall Mr. Cave's assessment at this
time of the second channel, and let me speak now of the
period subsequent to the meeting on September 19-2 0?
A I Ahiriic.MJi. ^^^ .ai^^P'^®^^®"^ after the
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initial Beating ^^^^^^^^^Hj I thinX Mr. Cava — I
remambar that ha called ma, I believe the afternoon of
the 19th, and that was a Friday — no, I guess the 20th
was a Friday — and he talked about a joint commission
that the Iranians had proposed, a joint commission, that
the individual, ^^^^^aHJ^^^^^^^^^^^v was very self-
assured.
It was quite a responsive statement on the
part of Mr. Cave that he felt we were into a very
promising development in this whole effort, and I think
in my conversations with him the following week after the
meetings of 19-21 September that Mr. Cave felt that this
offered a lot of promise,/
and he appeared to be exactly who he said ha was.
Q Old you have an understanding as to what
precisely this joint commission was supposed to do and
how long its duration was intended?
A Hall, I believe they talked about covering a
nuabar of areas — that they would look at economic
relations, political relations, that they were prepared
to name their members to the commission and for the
United States to do the same. I was surprised by the
Iranian aggressiveness in this, but I had no idea as to
how long it would be in existence.
BNfitASMB
891
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UNClASSIFe
653
Q . Were you awar« that during th« September 19-20
meeting Colonel North had in fact named members to the
commission?
A I was aware in October that he had named some
people to the commission. I didn't think — and I guess
I didn't think that Colonel North in September had named
the U.S. members. I thought this occurred in October and
that the members were Colonel North, General Secord, I
guess Mr. Hakim, and I guess Mr. Cave.
But I can't recall.
Q We will focus on the date of the naming of
persona to the joint commission in a moment, but your
understanding of the personnel on the commission
included, among others. General Secord. You were aware
at that time, of course, that General Secord was not a
U.S. Government employee; is that right?
A I didn't know that he was a government
employee. I thought in a sense that he was at least a
consultant to the NSC in order to carry out this role.
IINIitftSSiflfD
892
HHaiMHilj
654
1 Q How did you come by that understanding, Mr.
2 Allen?
3 A Well, I think I want to say that that was my
4 assumption at the time because I had, as you recall, met
5 General Secord for the first time in late January 1986,
6 and for some reason the fact that he was part of this
7 enterprise -- I'm not sure I would use the term
8 "enterprise", but this initiative — I just assumed that
9 there might be some consulting relationship with the NSC.
10 I never was told that. I never saw any
11 documentation to that effect. It was probably a false
12 assumption on my part.
13 Q Now I'm going to show you, Mr. Allen, just for
14 the sake of clarifying this aspect of your testimony, a
15 document you may or may not have ever seen. I don't have
16 a copy of it, so I won't mark it as an exhibit, but it
17 bears the Committee identifiers N-28774 through 28780.
18 And it contains in the middle of it a docximent which I
19 believe the CIA has, and that is a three-page summary or
20 four pages, excuse me, summary of the September 19-20
21 m««tlng prepared by George Cave, who was not himself
22 visibly listed as an author but who has confirmed that in
2 3 fact he was the author.
24 On the third page of this document, in
25 paragraph six, there is a reference to joint committee.
yueasstfifD
893
UNfilASSm
655
1 and in particular I would direct your attention to, it
2 looks like, the third sentence of that paragraph.
3 (Pause.)
4 A I didn't recall that this had been stated at
5 the time. I just had the impression that things had not
6 gone that far, as far as this memorandum. I think I have
7 seen it somewhere.
8 MR. WOODCOCK: Let's go off the record for a
9 second.
10 (A discussion was held off the record.)
11 MR. WOODCOCK: Let's go on the record.
12 BY MR. WOODCOCK: (Resuming)
13 Q I will summarize what you just said, Mr.
14 Allen. You've had an opportunity to briefly look at the
15 interior memorandum which starts with the heading
16 Secret/Sensitive, and then Subject: Rundown of visitors;
17 Comments on 19-20 September 86.
18 A I've seen that.
19 Q Your testimony is you've seen that before?
20 A I've seen the memorandum, but I've not seen
21 th« cover. I have not seen the cover documentation.
22 Q Thank you. Now in this immediate post-
23 September 19-20 period do you recall any discussion
24 either from Mr. Cave or anyone else within the CIA about
25 the appropriateness of formally bringing the State
BNCttSSfftED
894
UNCLASSIFiD
656
1 Department into this Iran initiative?
2 A I recall some discussion that as this
3 initiative proceeded and bore fruit and that there was a
4 feeling on the part of the NSC, I assume, that the
5 hostage matter would be resolved with this new, reliable
6 channel — and I put "reliable" in quotes — and that it
7 would be imperative at this time to bring in the
8 Department of State in order to more formally set up the
9 still-secret links with Iranian elements.
10 I believe Mr. Cave, as I recall, was an
11 advocate of this and he mentioned that to me in the late
12 September time frame, if I'm correct. And we discussed
13 it, Mr. Cave and I, and I think Mr. Cave indicated that
14 he had advocated this.
15 Q Did you agree with him?
16 A Yes, sir.
17 Q When you say that you believe he advocated it,
18 is that to Colonel North or Admiral Poindexter?
19 - A No. It would be my belief and my recollection
20 as wall that this was just something that he discussed
21 with Colonel North.
22 Q Are you aware of a meeting involving the
23 Director of Central Intelligence and Mr. Poindexter on
24 September 24, 1986?
25 A No, sir. I'm not necessarily aware of it, to
UNCbtSSIflfO
895
KASffD
657
1 the best of my knowledge.
2 Q The purpose of the meeting would have been to
3 give both the Director and Admiral Poindexter a summary
4 of the meeting that had just occurred on September 19 and
5 20. Does that give you any further basis for a memory on
6 that?
7 A I know that there was a briefing of the
8 Director. I was not a participant. But I don't
9 specifically recall Mr. Casey and Mr. Poindexter being
10 jointly briefed. I could well have known that and have
11 forgotten it.
12 Q Do you recall whether Mr. Cave ever told you
13 that? I think your testimony was he addressed this, but
14 let me put the question differently. Do you recall Mr.
15 Cave ever telling you that he spoke directly face-to-face
16 with Admiral Poindexter and advised him or emphasized to
17 him that it was important to bring the State Department
18 into this matter?
19 ' A I don't recall that he told me that he talked
20 directly to Admiral Poindexter, but I heard that he
21 discussed the matter. Particularly after this joint
22 commission had been proposed he had discussed it with me.
23 He said it is time to very carefully bring the Department
24 of State into this initiative, and I know that he
25 discussed it with Colonel North, but I cannot testify
DNetitSSIFlEO
896
mmmn
658
1 that h« talked to Admiral Polndexter.
2 Q Wara you aware — and this would be in the
3 same time frame, the immediate post-September 19-20 time
4 frame — of any effort on the part of Lieutenant Colonel
5 North to narrow the field of those who were aware of the
6 second channel?
7 A I sensed that something might be under way
8 along those lines, but I never had any direct evidence.
9 No one ever spoke to me specifically about it. I have
10 heard that that is the case, that (^^^^^^BH and Z were
11 to be excluded from the initiative.
12 Q So you had an understanding that you yourself
13
14 A Hall, I had a sense that that might be under
15 way, and I can't remember why. But during the Tower
16 Commission report the Tower Commission investigators
17 indicated they had documentation that stated that (
18 ^^^^^^^and I should be excluded.
19 Q Now given that you really were the liaison to
20 th« intelligence community for this initiative —
21 A Yes, sir.
22 Q — how does it stand that you would be
23 excluded from this kind of an undertaking?
24 A Well, I didn't have any direct knowledge at
25
897
UNCUS»S
659
1 intelligence which would help you measure progress or
2 evaluate the bona fides of the foreign nationals involved
3 in this initiative. You would need intelligence. So it
4 would not make good sense.
5 Q So Colonel North never came to you and said it
6 was time to restrict you out of the program?
7 A No, he never raised it directly with me, to my
8 knowledge or to my recollection. I know I would remember
9 that very distinctly. I continued the collection.
10 Q I gather from your testimony you first became
11 aware of this when you appeared before the Tower
12 Commission; is that correct?
13 A Yes. But, and I don't want to overstate it,
14 there was a sense, I think in the October time frame,
15 that there was great concern about the security of the
16 initiative. Colonel North was constantly worried over
17 that. I was worried over it, too. But I was at that
18 time very worried over the operational security.
19 Q Your concern was arising largely from the
20 Ghorbanifar difficulties; is that correct?
21 A Yes, and the fact that the unexplained
22 pricing, the fact that something was awry in the pricing
23 issue. But yes. Colonel North was constantly reiterating
24 the security of the program. But I came very directly,
25 and I guess knowledgeable from the investigators at the
mmssm
82-688 O-88-30
898
uNcyisstfe
660
1 Tov«r Commission, who stated — they did not show m« any
2 documentation, but they stated that there was
3 documentation — that they had direct Information that
4 Colonel North wished to exclude^^^^^^^^H^M)and
5 myself from the Initiative In the fall of 1986.
6 Q Now I need to sharpen that question so that I
7 understand whether in the fall of '86 you understood when
8 you realized that Colonel North had his own operational
9 security concerns, did you also understand that you were
10 part of his concern about operational security?
11 A I can't attest to that directly. I can only
12 say that there was heightened concern about the security.
13 Q Which affected you in any way?
14 A Well, it did not in a sense, because I knew of
15 impending meetings. Mr. Cave and I continued to work
16 every day. I worked on a thousand other things and Mr.
17 Cave worked directly on this project. And no way did I
13 feel that if I needed information on the initiative I
19 could always ask Mr. Cave and he would always be very
2 0 op«n to what was going on.
21 But I am just saying that there was a
22 heightened sense of worry and concern on the part of
2 3 Colonel North in the October time fraune. But I will not,
24 I cannot testify that I was aware that he had explicitly
25 planned to exclude me from the initiative.
ONCtlBSinED
899
llf^£UiSSIfHf
661
1 Q And I gather can you testify as to whether you
2 had any intuitive feeling that you were being restricted?
3 A No, I can't testify to that.
4 Q So whatever those documents that the Tower
5 Commission had had said, you saw no tangible
6 manifestation of that attempt during that period of time,
7 the late September-October period?
8 A No. I saw no specific, direct effort on the
9 part of Colonel North, nor did he ask Mr. Casey to
10 restrict me from the initiative.
11 Q Do you recall whether an effort was made to
12 bring medical supplies as part of the U.S. offering to
13 Iran along with arms in the fall of '86?
14 A Yes, sir.
15 Q What do you recall about that?
16 A I recall that in the fall of 1986 there were—
17 ideas ceune out of either the NSC or from some other
18 source that it would be good to show that non-lethal
19 material was included in the shipments and that I believe
2 0 tha Agency was asked to secure some medical supplies,
21 $40,000 worth of medical supplies, and there would be a
22 pallet of medical supplies, too, that would go in to
23 Israel and then on into Tehran with one of the shipments.
24 And I can't precisely recall now which
2 5 shipment was to include those medical supplies. I think
IJNCttS«D
900
rouble getting tne iifetftCa
662
1 they had trouble getting the Tirewfcal supplies onto the
2 plane and into Tehran. I know that the Agency helped
3 gather or procure the medical supplies.
4 Q Was it your understanding the Agency paid for
5 these medical supplies out of its own funds?
6 A I don't know.
7 Q Let me put the question differently and see if
8 this elicits a recollection. Do you recall whether the
9 monies for the medical supplies would have come from
10 monies that were deemed as excess following the August 3
11 delivery of HAWK parts?
12 A It was my understanding that the Agency would
13 be compensated for those medical supplies and they would
14 be compensated from one of the transactions, and it could
15 have been the HAWK. I believe that, like the rest of the
16 initiative, it was my understanding, and I don't know
17 that I am completely accurate in this, that the Agency
18 would not pay for any of these materials, whether they be
19 lethal or non-lethal, but funding had to be found for
20 thaa and, as I recall, it was a nominal amount. $40,000
21 is th« figure that comes to my mind, and one pallet.
22 Q Let me throw out alternative figures just to
23 see if they affect your recollection at all — about
24 three pallets at $180,000.
25 A I don't think I ever heard that much. I
iiNtttsstnto
901
UNCLASme
663
1 raoambcr th« $40,000. That is oora than I recall being
2 involved. That is substantially more.
3 Q Do you recall whether these medical supplies
4 were in any way represented as being handled by or
5 derived from any of Albert Hakim's business organizations
6 — and when I say "represented", I mean represented to
7 the Iranians?
8 A I don't recall at the time. There are other
9 details about the medical supplies that I know I knew at
10 the time, but I cannot recall that. Z may recall it
11 sometime, but at this time I just can't recall.
12 Q Let me pull two documents together and see if
13 they assist in your recollection at all. The first is
14 what has been marked as Exhibit 88 and the second is an
15 18-page single-spaced summary of the September 19-20
16 meeting taken from the notes of General Secord, who, as
17 this event would indicate, is a copious notetaker.
18 The first document. Exhibit 88, states in
19 paragraph three that Hakia spent a lot of time explaining
20 ^^^^^^^H that he wanted to set up some legitimate
21 business with Iran for cover purposes. He was willing to
22 sell medicinals at cost or on a credit basis with up to a
2 3 year to. pay if he could get some benefit out of it.
24 Now that's statement number one. The second
2 5 is Korth is the narrator in the meeting — and this is
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WiCL^lEe
664
the meeting on Septen^ber 19-20 - and the statement goes
as follows: One reason why the President agreed to the
TOWS and HAWK parts which have been shipped so far is
because they are defensive, help against Iraq and the
Soviets as well. Again, I say don't think too small.
For example, we have offered to send medical supplies
through Albert Hakim's organization. He believed that
medical supplies could be more valuable perhaps than all
the military ammunition we could send.
Talcing those two statements together, do those
give you any further definition to your memory about the
medical supplies and Albert HaKim's represented role with
13 respect to them?
A I'm afraid it doesn't. I remember reading
paragraph three in the 11 July 86 memorandum, and, of
course, I have never seen the lengthy NSC document. I'^n
sorry. I recall there was a lot of to-ing and fro-ing
about the medicines, that I felt at the time it was only
on. pallet, and substantially less cost than what is
20 indicated there.
And clearly I have read this memorandum, but
it did not stick in my mind that Mr. Hakim was going to
do the procurement and was going to do actually the
financial transactions on the medicines. I'm sorry. I
25 just can't recall
uKWsm
903
UNCIASSMD
665
1 Q Do you know whether the medical supplies ever
2 actually made It to Iran?
3 A I thought some medical supplies did go in, as
4 I recall, in one of the shipments in October. That was
5 my understanding.
6 Q Do you know where you gained that
7 understanding?
8 AX believe in conversations with Mr. Cave and
probably ^^^^^^^^B of thel^^^^^^H Division.
10 also discussing the medical supplies probably with
11 Colonel Earl at one point. I just can't recall. I
12 thought that at least one pallet of medical supplies went
13 into Iran. That has been my understanding. I may be in
14 error in that. I just have to testify that that was my
15 thoughts at the time.
16 Q Let me shift on to another topic. Do you
17 recall Mr. Cave ever telling you that in his meetings
18 with the Iranians in the fall of 1986 they advised him
19 that they had only recently determined who Robert
20 McFarlane and —
21 A Yes, absolutely. That struck me. I was
22 stunned. That was the 19-20 September meeting, 1986,
vher^J^HH|^^^^^^ he said that they didn't know
24 who Mr. McFarlane was and they later discovered that he
25 really was a very significant figure.
mtmm\i
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666
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Q And they also did not )cnov who Colonel North
was; does that square with your recollection?
A That's absolutely the case.
905
IINCUSSIflEO
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906
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Q L«t B« bring you back to November 23, 1985.
A Yes, sir.
Q You have testified that on that day you were
at CIA headquarters.
A Yes, Z was.
Q Your office Is on the seventh floor. Has It
there at that time, too?
A My office at that time was in ^^^H
ONCBSstre
907
1
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669
Q And whera in relation to your office was Mr.
Clarridge's office?
A It was directly down two flights, almost
beneath my office two flights.
Q Where is Mr. Juchniewicz in relation to you?
A Mr. Juchniewicz at that time was up next to
the Director's office on the seventh floor, 7D corridor.
Q And you were assisting Mr. Clarridge, I
gather, at that time by analyzing intelligence for him;
is that correct?
A I wasn't. What I did was I came into the
office at the request of Colonel North and Colonel North_
indicated that I should show Mr. Clarridge'
colonel North stated that this would
demonstrate to Mr. Clarridge the legitimacy of his
initiitive -- and I'm paraphrasing Colonel North -- but
that this was important that Mr. Clarridge see these
908
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UNfUSSII^D
670
tiin«; is that correct?
A Colonel North arrived an hour or an hour and a
half after I arrived.
Q Did you have any assistant with you?
A I did not have an assistant. I had another
senior official who came with me.
Q And that was
A
Q What was his role?
A
Q And what was he doing specifically on that
day?
A Well,^^H— and I don't guess I've testified
up here, but he is a longtime friend of
ind so he was a loncptime friend of Colonel
North. And when Benjamin Heir was released, when I ran
out of steeuB that weekend, h« can* in and helped ne and
worked with Colonel North on all the activities relating
to arranging for the debriefing of Benjamin Weir. And so
he was aware of the initiative.
WNttffiSW
909
ONcussra
671
1 Q So what was his duty on that day? How was he
2 helping?
3 A I recall we came down and at that stage Mr.
4 Clarridga Indicated there would be a flight into Tehran
5 and that I believe the only thing that I recall |||||^l
6 ^^^^^^^By^id that day, he obtained sone maps. He
7 obtained some very excellent maps of ^H^^^^^Vjthe
8 Middle East so that Mr. Clarridge could look at flight
9 routes .
10 I don't recall that he did anything else. I
11 recall the guards complained that Colonel North's car was
12 sitting at the south loading dock. Ha went out and moved
13 the car for Colonel North. But other than that I don't
14 recall that he did anything significant.
15 Q Now were you in Mr. Clarridge 's office most of
16 the time or part of the time on Saturday?
17 A Off and on for about five hours.
18 Q And would that period span from roughly 10:00-
19 10:30 until 2:00 or 3:00?
20 A Well, about 2:30 because I went to a football
21 game that afternoon. Herndon High School was playing for
22 the regional championships against T. C. Woodson, and
23 Colonel North wanted to go to the game, too, but he
24 stayed on and I went on to the game and got there at
25 half time. So I must have been there about five hours.
yNeiissm
910
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BNCtASSlflffi''
672
Q With testimony like that you raally are going
to persuade us that you do have another life.
A That is correct, sir.
Q Do you recall in addition to Mr. Clarridge and
I and yourself anyone else being present in
Mr. Clarridge 's office on that Saturday?
A Ves. ^^^^^^^^^^H) ^ believe, was there off
and on.
an excellent man.
Q Now I believe you've already testified and I
don't want to misconstrue your testimony, but my
recollection is that you did not see cable traffic on
that day; is that true?
A I didn't rdad C2ibl« traffic, but I Scnew that
C2ibles were being sent
)and I
knew generally at times some of what was being contained.
X don't recall reading the cables.
Mr. Clarridge, he didn't keep them from me,
but when I was there they were talking about getting a
flight clearance for a 747, an Israeli 747 coming out of
Tel Aviv and it flew halfway over the Med and the
clearance could not be obtained^
as I recall, and the plane turned around and went back to
iWeUSSIFifD
911
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673
T«l Aviv.
Q Do you recall Mr. Clarridge either going to
see Mr. Juchniewicz or vice versa during this period?
A I don't recall that at all. But I was in and
out. I went up to my own office because Colonel North
was in contact with an individual Mr. Copp, whom I later
learned was General Secord,
I was in and out, but off and on I
was there for five hours probably.
Q It has cone to our attention through testimony
of other witnesses, in particulai
I that on November 23 he sent a ciible summarizing a
conversation that he had had with Mr. Copp, now )tnown to
b« General Secord. In that conversation General Secord
related to him that the cargo aboard the planes or the
plane heading towards |^^mP was HAWK missiles.
Do you recall any discussion of the arrival of
a cable with that kind of information coming in on the
23 rd?
A No, I don't. But I want to maXe certain that
I understand your question. You indicated that there was
a cable saying that the plane coming into\^^^^H would
have HAWK missiles on it?
Q Correct
\1SQISSW
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UNCLASSn
674
A I don't recall a cable of that nature, nor do
I recall any conversations by Mr. Clarridge or Colonel
North to that effect.
Q No one brought that cable to your attention,
then; is that correct?
A That is correct. I have testified Colonel
North asserted several times that oil-drilling equipment
was involved. I found that, as I have testified, very
cur i ousW^^^^^^^^^^^^^^^B^H^^^^^^^^^^^^H^^^^^H
^^^^E^^^MfHI^^^^Wit inconceivable, one
would think that this initiative had involved arms in the
past.
But I had no evidence that it was not oil-
drilling equipment. I recall no cable. I never read any
«NettS«D
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mm
cabl« to that effect
Mfj^^
675
Q Did you share your suspicion at the time with
Mr. Clarridge? I'm saying at the time on November 23?
A I don't recall saying that. I don't recall
sharing that, no.
Q Do you recall Mr. McMahon being there at all?
A No. I do not recall seeing Mr. McMahon on
that Saturday.
Q Given that you had a suspicion that arms might
be Involved and you were aware that Iran was also
involved, would it not have been prudent to bring this to
the attention of the DO personnel?
A Well, I assumed Mr. Clarridge had done that
through the ranks. Mr. Clarridge is a very senior
official.
Q But I gather you assumed he )cnew?
A I assumed that if there was anything, any
aberrations involved in this NSC request and CIA support
of this request that he would have the reason, the logic
to bring this to the attention of more senior officials.
And I did not question this.
I didn't occur to me
that he would not get all of the appropriate clearances
UNWSIflED
914
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UN{[A^m
676
at av^ry level.
Q But he can only report what he knows; correct?
A That Is correct.
Q So what I'm driving at is was it your
impression that he either }uiew or suspected as well that
this shipment involved arms?
A I couldn't help but believe that he suspected
that.
Q But you don't recall actually confirming with
him your suspicion?
A I recall that Colonel North arrived and
Colonel North asserted that it was oil-drilling
equipment. He placed calls both, in our presence, to the
National Security Advisor and the Deputy National
Security Advisor and it seemed to me that — and he
placed thea through White House signals, so he wasn't
talking out there to anyone other than the National
Security Advisor and the Deputy National Security
Advisor. I am very confident of that.
So it seemed to me that whatever was occurring
that there was a very strong authorization at the highest
level of the U.S. Government, and that I assumed that Mr.
WietASMD
915
VNcusm
677
1 Clarridge had cleared this through his hierarchy. I
2 believe that Mr. Juchniewicz was the Acting Director of
3 Operations at the time.
4 Q Let me go back and see if I can summarize.
5 You don't recall directly sharing with Mr. Clarridge your
6 suspicions that perhaps this was really arms, and I
7 gather that the reason that you feel you didn't do that
8 was because you assumed he already knew.
9 A Well, I would assume that he would also have
10 suspicions.
11 Q Right. In other words, let me put this
12 question to you and see if this is correct. I'm talking
13 about your own habit. At this point, if you had detected
14 that Mr. Clarridge did not know what you suspected or did
15 not suspect what you suspected, would it have been your
16 practice to tell him that you suspected that arms might
17 be on this flight?
18 MS. MC GINN: I object to the form of the
19 question. If you understand it, you can answer it.
20 MR. WOODCOCK: No. Excuse me. Let m^ explain
21 what I'm doing here. Let me go off the record.
22 (A discussion was held off the record.)
23 BY MR. WOODCOCK: (Resuming)
24 Q Mr. Allen, bringing you back again to November
25 23, you have testified that you yourself suspected that
916
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uNomra
678
there were arms aboard this plane or arms involved in
this transaction; correct?
A I have testified now and previously that when
colonel North asserted it was oil-drilling equipment,
I saw no reference to oil-
drilling equipment. Therefore, I felt that something was
under way and that Colonel North was providing some cover
gtory and for reasons that he did not wish to tell me
that perhaps other than oil-drilling equipment was
involved — perhaps munitions.
I have testified to that. And I further
testified that I felt that this was something that was
authorized at the highest levels of the U.S. Government.
Q Right. Now what I'm speaking to with this
question is your role as a CIA employee and not as a
member of the U.S. Government at large, but as a CIA
employee in particular with obligations to the CIA.
A Absolutely.
Q Now your testimony is clear that you did not
know to a certainty but you did suspect that among the
range of cargoes that might have been involved here was
arms; is that correct?
A That was a suspicion. I have no evidence to
that other than interpreting the intelligence, which at
han interpretiny 2:*"»_^"-'
UNetftS«D
91J
liHUussn
679
1 that point was not specifically related to a specific
2 flight at that stage.
3 Q Now you also were working with Mr. Clarridge
4 on that; is that correct? You were assisting him in
5 this?
6 A The only thing I was doing was providing some
7 intelligence to him, and I sat there while this dialogue
8 went on and these activities went on with Mr. Clarridge,
9 Colonel North 3"<^ ^^H|^^^| Y^s-
10 Q If during that period of time you had
11 suspected that Mr. Clarridge was not witting of the
12 suspicions that you had with respect to the cargo, what,
13 based upon your past experience as a CIA employee, would
14 you have done with this senior officer?
15 A Well, this man is very senior, very
16 intelligent, very able, very analytic, and so I thought
17 the record would sort of speak for Itself on this issue.
18 I didn't have to pull him aside and explain to him what
19 was going on. He may well have had the same assumption
20 that I had.
21 Q Let me ask the question differently. Were you
22 assuming that he shared your suspicions?
23 A I didn't dwell on the issue, and I don't want
24 to be evasive. I want to be candid and forthcoming. I
25 assumed that he also had doubts about what Colonel North
mmssm
918
UNUASSm
680
1 was saying that morning. I didn't ask him, to the best
2 of my recollection. He is a very professional, very
3 analytic officer.
4 Q But as an intelligence officer part of your
5 obligation is to inform DO persons who rely upon
6 intelligence advice; is that not correct?
7 A Yes. They rely upon intelligence collected
8 and analyzed and estimated.
9 Q So if you reached the conclusion that Mr.
10 Clarridge had simply accepted Colonel North's statement
11 that this was oil-drilling equipment, would you have felt
12 an obligation to share your suspicions with him that it
13 was perhaps not oil-drilling equipment?
14 A If I felt there was anything. 1 guess I
15 didn't — I did not focus on the issue so much, but if I
16 felt that for some reason he was totally, had totally
17 gathered — if he did not at some point have some
18 suspicions about the content of the cargo, I probably
19 would have raised that with him. However, we weren't
2 0 focused so much on the cargo, and Mr. Clarridge was
21 focused on getting flight clearances and getting a
22 proprietary engaged.
23 But you are putting me, in trying to answer
24 questions — if I felt that for some reason he actually
25 needed to know that information, I would have certainly
BfffitASSIflEO
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llNCt4SSW
681
told him. But at that point I assumed he had the same
assumptions I had. And I can't recall exactly. I can't
recall any specific conversation about the cargo except I
recall when I went in before Colonel North arrived, I
recall he said the NSC has a problem and I am trying to
work the problem for them, that they want to lease some
aircraft for a special mission.
And I said well, X think this background may
help you. And then I described the Benjamin Weir
release, {
And at that point Mr. Clarrldg* said it had to
do with oil-drilling •gulpment, and I don't recall
precisely what conversation ensued, but I assumed that
after reading that and particularly after Colonel North
caae and again asserted it was oil-drilling ec[uipment, I
didn't have to tell Mr. Clarridge that perhaps this was a
cover story of the HSC.
Q Because you felt that, like you, he was
sufficiently versed to detect that?
A Yes. Am I candid enough?
HNMSStftEB
920
23
inftmsstnn
682
1 Q Yes.
2 A I don't know what was in Mr. Clarridge's mind.
3 Q I understand that. But, you see, what I'm
4 trying to get at — let me go off the record just a
5 second.
6 (A discussion was held off the record.)
7 MR. WOODCOCK: Mr. Allen, once again the clock
8 has conspired against us and we have reached the end of
9 the questioning. I appreciate again your patience. I'm
10 sorry to have kept you waiting here. But I will conspire
11 here with Mr. Kerr on whether we need to bring you back
12 again, but I don't think it will be before your much-
13 needed vacation and well-earned vacation.
14 THE WITNESS: Thank you, sir.
15 MR. KERR: Mr. Allen, we may be able to avoid
16 this all again.
17 (Whereupon, at 12:05 p.m., the taking of the
18 instant deposition ceased.)
19
20 Signature of the Witness
21 Subscribed and sworn to before me this day of
22 , 1987.
24 Notary Public
25 My Commission expires:
921
FavT^nd R. Heer III
::ragoir. g ;a30Siri3n was :a<an, do.haraDv certify :hac ::•. a w. :r. ass
appears in :ha foreg3ing deposi::.::^ vas duly svorr.
/nosa cas:i:i:;:
3 V
; chac cha cas^iraonv o i said •Ji:nes5 -.-as
cakaa by 3e zo cna base of a/ ability and cheraafcar red u cad zo cypewriii:
undar ay diraccion; chac said deposition is a true record of tna tasriaon;.
given by said vitness; chat I am neitnar counsel for, related to, -or
employed by any of the parties to the action in vhich this deposition
was taken, and further that I am not a relative or employee of any
accorney or counsel employed by the parties thereto, not financially
or otherwise interested in tha outcome of the action.
TAST PUBLIC
DISTRICT OF COLUMBIA
My Commission expires: ^Y 31, 1989
UNCLASSIFIED
922
ONClAilFIED
TV OirtCMr •rCcMnI liii(Ui|ciiC(
DC SW
C 2188
NIC 01799-85
< April 1985
FOR: OiPertOiy of Central Intelligence ai, ^ a
""■^"""^'■'"o'- of Centr.l Intelligence AI|e/lC</^i
E. Fuller
'■Wational Intelligence Officer for NESA
Iranian Pol itics
1. Ue are moving toward an extremely
Iranian politics. It could represent
interests--for better or for worse.
Iran's econoaic problems Increase, 1i
continues to be a losing prospect foi
for evolving chaos or even some sort
were to die soon, the most probable si
involve the emergence of a strong cle
military or Revolutionary Guard backi
Khomeini moves towards a prolonged h,
'"' lit for su(
delicate and complex phase of
irning point for US
leini's grip loosens and
lism is growing and the war
-all heightening the chances
imatic change. If Khomeini
0 for succession would still
figure or someone with strong
se to the clerics. The longer
ho»»«ver. th«
1979 All Over Again? As the radical clergy watches,
grip lessening and unrest growing,, it will be nervous about
futore-especially in view of some of the support which Kh^
to the More aoderate elements in the past several months-i
continued support for the war.
Partially Declasstied/Peleased on £toJAv^iS8
under provisions ot E 0 12356
This Memo is Classified by K Johnson, National Secunty council
SECRET in its entirety.
IQ^I
CL B1
OECL 0A6B
{unfa IwdT Z^i2^
■^
923
TNCLftSSIFIED = .
89
There is a distinct possibility that the radical clergy »ty 5^.,^
to replay the hostage crisis of 1979 in which, by a broad attack
_jfpon the US, they were able to galvanize Iranian Internal
itics, dfsplace the moderates, and seize power. Might the
^^^^-.radlciiWlergy not seek direct attack upon American interests
cr'^r^^oncVSgnin— perhaps in the very expectation that the US might
strlkcibaiefc it IrM<M territory proper, thereby polarizing the
interWvin^Mcr struggle and strengthening the radicals?
. Who Gets to Tehran First? The respective positions of the USSR
ie US in tbt^^n-lr*^ war are particularly anomalous. Rarely do
^_ ^ and ttt^AOTUt Union ctbI up— even for tactical reasons— on the
sVnejSljCjg^jggjgfl3fflC_1nternat1onal con^c^whare the stakes are so
higlfiMBBflBH^S^B^^^HBlHHi^^^^^^we are from
Iran''^6Su^[tOTT only a matter of time before one or the other of us
finds the opening it seeks in Iran.
5. I would guess the Soviets are best served by allowing the
clerical regime to continue to crumble until the situation Is opsn enough
for the other Iranian actors described above to play a role. Despite
growing restlvcacss la Irm we trt not jfst In that stage--but thet stage
csali cone aore stflftly than we realize.
6. The US faces a serious dllemna: the actions of
may compel the US to treat very roughly a regime which c^
possibly opening the way to a slide to the left and a m.
We will have to balance the costs of defending US cred
conrnitment In the face of terrorist attack against th
geostrategic gains to be won or lost for influence in
Lf^ Grahat
924
niiU' -A. "X
C 2243
mC 02545-8S
17 May 1S85
fCHORAWXW FDR: Director of Central Intel Hgence
\^*v _j^eputy Director of Central Intelligence
FROM : '^j^^^^-^Cr ah am E. Fuller
National Intelligence Officer for NESA P^niaiiv ceriassificd/neicdseo on '-' Jt^r.p.P.
under provisions of £ 0 ;2j55
SUBJECT: _ Toward a Policy on Iran "'/ k Jofnson. National Secu^^ Council
1. The US faces a grim situation In developing a new policy toward
Iran. Events are moving largely against our Interests and we have few
palatable alternatives. In bluntest^fom. the Khomeini regime Is
falter ng and m^^, be aovlng toward |«. moment of truth; we will soon see a
straggle for succession. The US ha's^almost no cards to play; the USSR
has many. Iran has obviously concluded .that whether they like Russia and
Sirrln'horhTv^'^.^K^? *? ''* """'••> ^° "=°«'« t° t«™s with: "lie
USSR can both hurt and hel£ Iran more than the US can. Our urgent need
IS to develop a Broad spectrum of policy nloves designed to give us some
leverage In the race for Influence ftrf^raji. 3 « «» >«"e
" ~ ?Lw^!r.*" ►^ "? *:*^jH&» stmdlng^OT the saBTslliTf "
' 1^^! " ?"f' *^'-««^«Mf11et. like theBuTTwar, 1$
•rtraortllnary. It is also an unstable tituation and cannot
our preferred access to Iran. Whoever gets there first is in a
strong position to work towards the exclusion of the other.
°"^^""** ^^ '"°"'^<' Soviet progress toward
n^«« 'k 'I'"*^^?*"' leverage in Tehran. We must monitor that
?r^ !! "T^*;' *• *'" already know where Moscow warO^t^o and
th«t it will devote major resources to claiming th^^Ktant
pri2«. Even if Moscow's progress Is uneven, we n^^^^^eloo
« strategy in response. -m^mmim.^ ^v
t.t^,J:r^;ilU^!"''°'""'°^^^^-- "SP«"<=y«tP^e
— We will respond with force directly if Iran
another terrorist outrage against the US.
'his Memo is Cli
.ECRCT/NOFOAIt in
y^<^/
925
C 2244
We seek to choke off all «rn$ supplies to Tehran wherever
^r« possible.
,«-' ■ "~ "- \- • - ■ -
3. Terrorist Attack: Ue can and Bost have »o«e policy against
terjTorfsal Ue must also recognize that this cannot repesent the tulk of
our^pollcy toward Iran. Furthentiore, radical forces in Tehran may
welcome' a direct confrontation with the US— Including US military
retallation--in the hopes of replaying its extraordinarily successful
SatibU^S«t<^t thetilS In the 1979 iwstage crisis.
--uiOurlng that crisis the radicals galvanized the Iranian
^Ifejtaosphere,- polarized all views, rendered the moderates
Trrelevant, and proceeded to eliminate thea In the supercharged
atmosphere of confrontation.
These radicals may seek to do so again In the expectation of doing away
with any opportjjnitjf the conserve
with ^^^^^^^^^^^^^^^^^^^^^^^^^^
we cannot
low terror! sa to go unchecked, wel
against the potential stake In Irani
ibalance the terrorist policy
Oiofclng off Arms Supplies. Bltefe are good reasons to seek to
jplies to IiunlJ^^ilt Bay be
choke off Soviet arms supplies to IiQnlJ^^ilt aay be one way of bringing an
end to the war which only Iran seeks^tA perpetuate. If the embargo is
successful, however, it could also )uve>thc effect of driving Iran into a
corner where the Soviets will be thg^ftjt option left.
Uc flrU raised (about 18 i^B ago.) tkis theoretical
possibility of Soviet oppoJ^^Br stcaifng from the US arms
utjii JO. The possibility ^^^Honger theoretical. Iran has.
In fact, now begun moving toward some accommodation with the
USSR. Meanwhile, the USSR can afford to play It cool and set
Its own terms, relatively confident that the US cannot steal a
■arch 00 It.
5. These two pillars of US policy— both sensible while Iran was In a
vacum and Khoneinl was strong— can no longer serve as the primary
vehicle for US policy toward Iran. Both are entirely negatlM^j^ature
and may now serve to facilitate Soviet Interests more than fiffSbMnSk Ue
must develop a more positive set of plans Involving a much
spectrin of considerations and actions.
— It Is easy to criticize our present position, an
to suggest that any easy answers exist. It is ^
however, that we perhaps think in terms of a bq|3ibn
wsm
I3fo
926
sligtrtly riskier policy which will at least ensure greater US
vblce^nfthe unfolding situation. Right now—unless we are >tkry
'|^ndeed--we stand to gain nothing, and lose more, in the
^.MtcomedDf^velopments in IrAn, Mbich are all outside our
' control -Xg^jt. ' '
fji.6;^ Some Broader Policy Considerations. Nobody has any brilliant
ideas^bout how to get us back into Tehran. Nearly all tentative
proposals require j^incflofortable choices and clear-cut down sides.
Nonetheless we need ^to( review a broad spectrum of ideas. I submit below
a range of'thoughtsi^iarrots and sticks, — all of which are flawed — but
which"«lghl.l«ssist^n sparking better and more refined positions to meet
our nee'Ssi^if'f^A^"
a. Work witn Iraq to bring Tehran to its knees. We could consider
moving much closer to Iraq to bring the war to a quicker end —
particularly by way of encouraging crippling attacks on Kharg
Island and key Iranian economic facilities. This would serve to
put intolerable pressure upon the regime, perhaps damaging the
hardliners, maybe even leading toward the collapse of the
to.
clerics. It would probab
conclaslon. Disadvantage:
oaerge victorious from su
eleoents filled with hatr
of the guns. It might ens
Moscow.
Open up Iran to friendly s
European allies, as well a
.tapHt, Brazil and Argentin
a ptramount position durln
would remove all restrlctl
g the war to a de facto
ave no knowledge about who would
les; It could well be radical
he US. The radicals have most
ehran's rapid accommodation with
ite^inf luence. We could tell all our
e), Turkey. Pakistan, China,
Vestcm Influence must develop
critical perlod-ln Iran. We
sales— Including military--to
I
Iran- Our only proviso would be the request that truly
strategic items which could Imnediately affect the conduct of
the war be avoided. (In fact, in the short term, few Itetns
««uld realljr reverse the course of the war.) Such a^step would
effectively preclude Iran turning to or needing the USSR.
Iran's diminished isolation might encourage the emergence of
Iran's moderates Into a greater policy role. Oisadvantac
Possible encouragement for Iranian perpetuation
Go after Iran's radical allies. While direct US
Iran could bring about the very thing we wish to
Soviet domination of Iran, direct attack on Ir
allies, Syria and Libya, would probably sober
Its support from those quarters. It would be
the "radical entente." Qadhafi In particular
*/ttWffi
m:>'
927
limSSIFIE
C -2246
^■^^'■^ Israel --V.
Ue have every' reason in the world to want to see Qadhafi
colT«pst!w Bold US policies leading to his downfall would have
tect ort Iran and shake its confidence that the -
>_f radical forces was with them- .(Pressure on Syria
effect end could Ideally only come from> •
TcN^s hardly interested In a confrontation with Syria
£iV;* at this point.) This "Indirect strategy* would demonstrate US
t^r^^ resolve against radical Isn without directly pushing Iran In the
^f^^': wrong directioo. Unlike Iran, we have nothing to lose In Libya
^■i-.L-'kand everypw^to gain.
d.-V''B*att"gninq8fl»«n the hatches in Turkey and Pakistan. Assuming
^^that-'weyaay be heading for a major Soviet gain in Iran, we may
need^o greatly step up our ties with Turkey and Pakistan.
Turkey is at the heart of US ability to respond to any future
Soviet military action against Iran. Both countries would be
profoundly affected by an Iranian lurch In
direct i on.
urkey 1$ even nore
Stan because of Its KATO ties, control of the
Bosphorus and contiguous borderjwith the Soviet Union. These
states oust be reassured tflBj^e are deeply connitted to their
suPDort_evcn if we cannot mmriil a negative course of events in
Iran-
f.
Getting the Message ThrouqlBtJo Tehran. Most analysts believe
that nearly all eleoents if
Implacably hostile to the
ataosphert generated ^ Ir^
hs felt U Inappropriate
Iran In general. There is
*rt convinced that the US Is
regime. In the ugly
errorlsn and the war, the US
ess words. of reconciliation to
or such broad, public statement
on a regular basis to ensure Iranian Moderates— and
opportunists— that we »rt not dedicated to the overthrow of the
Islamic Republic or the collapse of Iran. This In Itself helps
play against the barrage of propaganda from the top. Iranian
leadership which wishes to portr^ the US as the implacable
eneay. The hostage crisis Is far past and anti -American mob
scenes are less exhilarating for the Iranian public than they
were in the heady days of the new Republic.
Massive reassurance to Iran of US Intentions. Men
not be enough to change the tide of moderate opinl
In Iran about the US. We could reemphaslze this
if coupled with demonstrations of goodwill throu<
the Sixth Fleet from the vicinity of the Persi
placing the US military presence In the Gulf
J^^/
928
C 2247
profile. Oisadvanttqe: We alght persuade Iranian radicals that
g[«a|«|^.yen up, or were paper tigers, or both. Our Arab allies
ifflhtdAiftjConf idence. On the other hand, such gestures could
revoked if Ir«n Itself were not forthcoming or If the
Itnger 'WHbpic- In any case, there are major benefits in
^making a ifcfles of positive gestures toward Iran indicating
basic goodwill --even if not immediately reciprocated by Iran.
The non-radicals will get the message.
>BarT}ain1r4^5f!S the USSR. We have little leverage here.
owever>-thgA)SSR in its public statements constantly stress
tia^dpraJ^Sfs bent on placing Pershing missiles in Israel,
klSa^Sn^ Turkey. In theory these ire bargaining chips which
couldtTe "given away* at no cost in exchange for some
"understanding" over Iran. The main problem is that we can
hardly warn the Soviets against establishing better ties with
Tehran, or even supplying arms to Tehran. These are not
belligerent acts in and of themselves and our major problem In
Iran is not Soviet invasion but rather support to radical forces
who oight nove the country closer to Moscow.
7. Oa reflection I believe tha
orfeoted Is th«t of inserting Ueste
quickly through the arms door. It
of then and is a 'positive' policy.
happy— especially Iraq. But most Gi
would not object to better Western
moderation.
^option most constructively
iljles and friends into Tehran
r«meet with broad support by all
M^ Arabs will be less
abs want a de-fanged Iran and
n Tehran If it leads to
The risk of perpetuatfag t^lB Is there. But the Western card
^ ' Is easily ondertakea and cf^Hcoupled with other US positive
gestures discussed above; -fl^Bed- not rule out
sticks — especially those against Iranian allies like Qadhafl.
Diminished political, economic, and military isolation could
have much pos1t1vjLjef/ect on a shaky Tehran regime— especially
if sooe quid pro qua was sought froa Iran by our allies in
■oviag Into Iran In a big way.
8. Our tilt to Iraq was tinely when Iraq was against the ropes and
the Islamic revolution was on a roll. The time may now have^jom^o tilt
back— at least via our allies— to ensure the Soviets lose bo^^DJ^ction
and potential access to the clergy.
J^S"/
929
Talking Points for the DCI
22 M*y 1985
Iran-Soviet Relations
C -2248-
5r over a%canzhas sought improved relations with the <iSSR and
rcelerated these efforts.
^indicate that Tehran for some
waatedpajexpand contacts aofSJipen the anlaosities resulting
cracJ(^own,«n the Conajnist Tudeh Party and the expluslon of
in 1983.
Iran rCToai)V«d*r ts efforts In March after the failure of its latest
offensive against Iraq.
— Growing domestic unrest, war weariness, and a deteriorating economy
encouraged the Iranians to seek a way out of their diplomatic isolation.
— They hope to gain additional arms and spare parts, econornlc aid. and
Soviet pressure on Iraq. The Soviets have delivered limited amounts of
snail ar« to Iran since the waryjtflip and have allowed their East
European allies t« provide largeg^utities of such arms.
Last awnth, Znmfko ret an IraniaHB^ty foreign minister In Moscow.
The two sides agree<l to future high-levelj^lltlcal and economic exchanges.
The Iranians also reportedly agr{i|
pipeline, although more bargain!
ttoKM, aeaiMblle. agreed to gra
Sov1ct.a1rspacc for flights to E
reopen the I rani an- Soviet gas
bably 1$ required on pricing.
special penDisslolTfor use of
and Sljrrla. —
Despite these positive developments, a najor upturn in relations.
Including substantial arms transfers. Is unlikely.
— Moscow Hill aot HCJit to Jeopardize Its relations with Iraq by providing
' aajor Mapoas ^stcas, but probablj calcalates that Baghdad's dependence
on Soviet »rms Is likely to limit Its reaction to a modest improveBent
In Soviet- I ran Ian relations.
Moscow apparently believes It has the most leverage in th^
relationship with Tehran and seems determined to gain ti many
possible.
— Iran has curtailed its anti-Soviet rlietoric and whil
from the walls of the Soviet Embassy.
82-688 0-88-31
930
SUIJECT: POSSIBLE CONTACT WITH IRANIAN COVeRNHENT REPS
1. THROUGH A COMPLEX SERIES OF LEADS WE HAVE BEEN PRESENTED
WITH AN ALLEGED OPPORTUNITY TO MEET WITH REPRESENTATIVES Of THE
IRANIAN COVERNHENT. THESE REPRESENTATI VS&J>URPORTEDLY ARE CAPABLE
OF SECURING THE RELEASE OF THE SEVEN HOSTIGES. WHILE WE ARE
SKEPTICAL THAT THIS IS A BONA FIDE INITIJTIVE WE MUST fOLLOW-UP
UNTIL WE ARE MORE CONFIDENT ABOUT WHAT VLUtl DEALING
C^iVA/ I02H
931
Opd*t« ea tha ■•■h«ai •■e«p«d«. As of last night .^
■till M€«tiT> about th« two naa«f-«4Ff«r*d
L«nd MMi«ch«hr (inf 11 .qf f iear)
M'
c
•arlicr «nd had
It tarns out^^^^^^^^^^^^^^^^^^^^^^^^^^^^
I that h« was
• fabricator. According to^^^^B our only knowladga of^^^^^^H
in tha biographic filaa is through^aporting fro^Manach^tf^bo-^p^-^
claiaad, aaong othar things, thatfl^^^^H5'*«^^^^{KaSidiTidual
rasponaibla for tha kidnapping of WXltCB Bucklay". In othar Words,
CIA haa baan around thia saaa iaaoo^
I inclination,
thus, vaa to racoanand to Casay t^i^ tha. Bashami connaction b«
r.
droppad. Ha aaid thay would do wSChirtg, bowavar, panding furthar
,^^^^^^^_^^^_ pv
word^^BH^HI^B This ieaua-^aaf eoaa up at tha 3<00 pm
aaatiag vithMBH^HH|| -=^
Our Kanaehahr, tha ona Stava GruaBon raaurracted froa bia files,
ia anotbar-ona apparently (saa attached TD, part 20).
If tbay do want to kill tha initiative, it would b« north asking
if they are aura that their Manaehehr ia the one la quaation. i.e.,
it's a fairly conaon naaa and how do thay know its tha oaa who was
the fabricator? No have not been able to identlf;
lor
Tarioualy described a a
KEVlCWeO FM mUASC
mMw^
932
/ijix ?r
S E C • I T )
MUt M STAFF
Partially Oeciassified/Released on^b^e/.^^
unde( orovisions ol E 0 12356
by K Johnson. National Security Council
SjJL^ONTAC^nTH IRANIAN COVERN«NT REPS
00
1. ON 12 JULY ^^^■mft uitu^^^^^^^^
FOLLOWS: WE HAVE BEEN PRESENTED WlPf^Bftr.S.iU'SS"" *"" «
REPRESENTATIVES OF THE GOVERNMENT OF |2**?CI«' IT J° """^ *"""<
SAY THEY ARE IN A POSITION TO OBTAIN ISf riJ2!l?/"'""ENTATl VES
AMERICAN HOSTAGES. THOUGH uLaRE SKEl??ri.'*u?*Ii9'* °' "^"^ SEVEN
~ UNREPRESENTATIVE s an^jJBlimMymtfk Wt fllllT fPlf-
HWPPiP'^P''^ *ND A CERTAn, nwnjutiitR _
_INC IRANIAN INTELLIGENCE OFFICER AJTTSTroicnT.B: '"t' * "'^^'
^THAT WE CAN CONFIRM THE IDENTITY »f 'WTERWEamy M.t .u,
03
933
J-oler
S I C R I T _
ST*FF-0«1i2tt^
TO: llweBI*""
Partially Declassified/Released onj(»ifti0i
under orovisions o( £ 0 12356
by K Johnson, National Secuniy Council
SUiJta: MSSItLt CONTACT WITH IRANIAN COVCRN«tNT REPS
1 THROUGH A COMPLEX SERIES OF LEADS WE HAVE BEEN PRESENTED
WITH AN AILECED OPPORTUNITY TO «£ET WITH REPRESENTATIVES OF THE
IRANIAN COVERNHENT. THESE REPRESENTATI VEk^URPORTEDLY ARE CAPAILE
OF SECURING THE RELEASE OF THE SEVEN HOMTTCES. WHILE WE ARE
SKEPTICAL THAT THIS IS A BONA FIDE INITIATIVE WE MUST FOLLOW-UP
UNTIL WE ARE MRE CONFIDENT ABOUT WHAT MLMl DEALING
U'^'B^
((LMU)). A RANKINfil
HAS ADVISED US THAT WE C,
AN INTERHEOIARV
TITY OF THE LATTEP
\k. FYIO:^
WE MOTt
n. WE AlSB N&Tt THAT ALL OUR INF»piTIBqH|HHB^P STEMS
FROM ^BRIPORT INC. AS YOU KNOW. WC lELmSiVTO IE A FABRICATOR
ANO NAVE CIRCULATED A BURN NOTICE ON HIH if) I RECTOR 0230SS)
PLEASE AOVISE. CREATLV APPReet«TE ASSISTANCE.
T.>
END OF nCSSAGE
SECRET—
03
DO wU^l56
f^^ltJ ro2H
934
Tn( b-
Office of Ge'e-al Cojnsel
Central Intelligence Ageicy
FROK:
SUBJECT:
7 (ycf^^^
7 October 19E5 C^ ^
Allen^x,
it
7-
PMially Declass.f.ed/Released on <=?G J «,d gg
under Dfovisions ot E 0 123S6 ~
fy K Johnson National Security Council
Charles E. Allen
National Intelligence Officer for Counterterrorism
and Narcotics
Background on U.S. Initiative to Secure Release of
American Hostages
0644
Uc\c\^
1. The following is provided for your background on an extremely •
sensitive White House initiative to secure the release of the American
hostages held by the Iranian-backed Hizballah organization in Lebanon. This
initiative has been underway for some months and is being controlled directly
by the National Security Council (NSC). I have served the NSC as the focal
point for coordinating Intelligence Comnunity collection requirements to
support the White House initiative.
2. On 12 September, I was requested by LTC Oliver North, Deputy Director
o^P^Uical/Military Affairs of the NSC, to begin Intelligence Conriunity
BH^^^Bagainst certain Iranians who were involved with the Wnite House and
wh^^er^n contact with the Lebanese Hizballah. Over the next two days I was
aM^t^ecur^uf^^nt information to identif>
■IHII^mi^H two who were the key
Hniisa ipiti»tTup fino pf the Iranians wasf
th£__Ql.h&r__indJxmiigJ— m name3^^^^^».-.ose
first name is unknown.
Lal+ ot the Iranian government
■imzvraaTViTni
fie White House was able to gaif^r^TcaT insights into the attitudes of
these Iranians toward the release of the American hostages and the
relationship and Influence that Iranian officials have over Hizballah
personnel who are holding the hostages. The release of Rev. Benjamin We^r was
effected by th^J^^e House working through intermediaries who were in direct
contact wit^^H^I^ who in turr^ja^dealing directly with]
Following the release of We1r,|^HH^indicated, again through
intermediaries, to the White H^s^Tnat other American hostages might be
released in the
UNfiblSSffl^^
SC 8357-85
Copy 1 of 2
935
3. O"- ?^epte^^e^^«^n formed by the NSC (LTC Nprtnl to again
-;;':-'>'■-: 'liBii^HH||HB<3' - tne'
cciectior. b»€*use the White House had received infoTmaTTcTT^t another
h:ita?9, p'"obably Wi Ilia'T 6j:t1<
Oc t :>ji'-. 'his
; an- ■ c
Jlr.id on 3 Oclo&er that it plan'.ed to execuTp Mi ]]^'^ Bjci^e^^^eited a new
dL-.e-ision in the continuing contacts betxeE^^Sfl^ an: AfflHj^ The White
House through intermediaries indicated tcBH^^^^that ii?a^^^rtant that
he cone to the US in order to determine whetn^^otential still exists to
secure the release of Buciley, assur-.ing that he had not been killed, or of the
regaining hostaaps hfld by Hizballah. The White House informed we on
0645
was perhaps our last
opportunity to utilize this channel to determine whether William Buckley is
still alive (we now have strong evidence that he Is dead) and whether there
.are any opportunities re
4 . From my per
collec
QOV
,and based on the analysis of the intelligence
Iranian
itial member
ily comes from a White House official
has been" an important intermediary in this
936
Initiative aid fiat he toe ^i% fina'^tiji aTange-ieits w
m*€t'ncs i" t:_mv] 1 occjr tn's wee' ne-c 1'; Was'^uigtor ■-, ,
are consicJe'ed pivotal by the WMte Hojse as to whether this muiaiTv? >.
be pj'sued further. The hostages oe'ieved to be held by Hizballah are as
follows: Father Lawrence Jenco, a Sj-s^ Catholic priest; Ca>id Jacotsen,
director of Beirut's Americai University Hospital; Thor.as Sutherland, Dean of
AgricuHye at the American University; and Terry Anderson, cnief AP
corresporjent in the Middle East.
Charles £. Allen
064o
DECL
CL BY
yNClASSIFIED
TOP SECRET
937
.^''e;i&^?
N 6224
SECRET/NOFORN/NOCONTRACT/ORCON
THE DIRECTOR OF
CENTRAL INTELLIGENCE
/
National lnt*lirg«n<* Council
19 September 1985
01 iver North
NSC Staff
392 OEOB
SUBJECT: Report of Possible Iranian Arms Deal
Attache
from CIA's
of my reque
arms negoti
internation
1 n format ion
is in the o
this could
out that Ir
such scams
bel ieve tha
such a
d for your information is a response
Directorate of Intelligence as a result
St for information on any impending
ations between Tphran and nnssible
al arms dealej
he Agency has no
that such an arms procurement deal
ffing. Agency analysts suspect that
be a gray market arms scam and point
an has been the target of a number of
in recent years. Agency analysts
t if a sovereign state is involve
tiation,
Partially Declassified/Released on 7.(o J >^*~>t
under provisions o( E 0 12356
by K Johnson National Security Council
(2L
Charles E. Allen
■o-X^
V
938
«ussm
N 6225
18 September 1985
MEMORANDUM FOR: Charles Allen
National Intelligence Officer for
Counterterrorism
FROM:
SUBJECT:
Lee of Global Issues
Recent Iranian Arms Procurement (C)
1. This responds to your request oq|^^^H^^^^^^^for
background information on possible arms nego^Sffon^^etween Iran
and Western arms dealers. Based on available information, we
cannot confirm that a Western, arms delegation will travel to Iran
late September in order to conclude a contract^m^HHm^l
_ Morever, even if we had information
lat such ~a"aei.egat ion nad a trip to Iran in the offing, we would
strongly doubt its ability to provide large quantities of such
sophisticated ordnance. (S NF)
2. If a delegation of arms dealers in fact plans to visit
Iran and is acting on its own, the group is almost certainly
mounting a scam designed to obtain a large advance downpayment
from Tehran. The dealers might either abscond with this money or
attempt to substitute other, more obtainable ordnance at a future
date. Iran has been the target of innumerable gray market arms
scams since it severed its traditional arms procurement channels
shortly after the revolution. (See attached memorandum on Gray
Market Arms Scams.) Lately, however, Iran has exercised
considerable caution in its gray market activities. Tehran now
requires that the seller post a sizeable performance bond and
insists on prior inspection and full delivery of all contracted
items before paying any monies. (S NF)
3. There is a possibility that the delegation is not acting
on its own but merely serving as a front for a government which
wishes to divert arms to Iran while maintaining an element of
deniability. We believe that the current soft international arms
market has led a number of Western governments to conclude that
they can no longer afford to ignore a lucrative- -and seemingly
insatiable — arms market like Iran. While such governments may be
939
ICLASSIFIEl)
N 6226
increasingly willing to supply Tehran indirectly with small arms
ammunition, spare parts, and "non-lethal" military ordnance,
none, in.our view, would supply large quantities of sophisticated
US-origin missiles to Iran. Such action would endanger future
arms purchases from the United States
to come from the countr
and the
We have attached several typescripts on the subject of
Iranian arms procurement for your information. Should vou havg
Jurther questions, please contact'
(C)
Attachments: As stated
940
^ ONCUSSIF!
^LbcOM80TS
N (o^^n
4heu
941
(C 2^49 - c 2353)
IP
Tu.v\
UNCUSSIFIED
942
The Director of Ccnlrjl Inicllitcncc
kV>NKni>^ D c wsos
2 c -^f 'u s-r
wnwsw
en E)c*-/0
26 November 1985
0400
MEMORANDUM FOR: Vice Admiral John M. Poindexter, USN
Deputy Assistant to the President
for National Security Affairs
SUBJECT:
Presidential Finding on Middle East
Pursuant to our conversation this should go to
the President for his signature and should not be
passed around in any hands below our level.
Attachment:
As stated
/
Partially Declassptied/fleleased on,2ti«i^vs.fi5
under provisions of E 0 12356
by K Johnson. Nanonal Second Counci
^<\^
943
KUSStFIE
Finding Pursuant to Section 662 of the Foreign
Assistance Act of 1961, As Amended, Concerning
Operations Undertaken by the Central Intelligence
Agency in Foreign Countries, Other Than Those
Intended Solely for the Purpose of Intelligence
Collection I
0401
I have been briefed on the efforts being
parties to obtain the release of Ajnericans he
the Middle East, and hereby find that the fol
in foreign countries (including all support n
such operations) are important to the nationa
the United States. Because of the extreme se
these operations, in the exercise of the Pres
tutional authorities, I direct the Director o
Intelligence not to brief the Congress of the
as provided for in Section 501 of the Nationa
of 1947, as amended, until such time as I may
made by private
Id hostage in
lowing operations
ecessary to
1 security of
nsitivity of
ident's consti-
f Central
United States,
1 Security Act
direct otherwise.
SCOPE
Hostage Rescue -
Middle East
DESCRIPTION
The provision of assistance by the
Central Intelligence Agency to
private parties in their attempt to
obtain the release of Americans
held hostage in the Middle East.
Such assistance is to include the
provision of transportation,
communications, and other necessary
support. As part of these efforts
certain foreign materiel and munitions
may be provided to the Government
of Iran which is taking steps to
facilitate the release of the
American hostages.
All prior actions taken by U.S.
Government officials in furtherance
of this effort are hereby ratified.
The White House
Washington, D.C.
Date:
m^
CY of
cr3
944
IINCUSSIFIEO ^^ '^"
jchn MC^on-s HBHO for the record of Dec«*er 7, 1985,
,ITLE S^rning assistance, to J Secord,
DATE
Dec 85
DESCRIPTOR - TO/FROn
MFR (NSC Mission) John N. Mc'>1ahon
Bllen5<*f
^artailjrOeciassrtied/fieleasedonJtJl/. «A
«IASS« (q^
»40
iWWflflffl
hVoiW
7 Oeceaber 1985
I 0393
1L"40RAN0UM FOR THE RECORD
iUBJECT: -JSC Mission
1. On Saturday, 23 >(ovember 1985, £d Jucnniewicz asked ue if I was
-are of all tne activity transairina on the effort to get the hostages
ut. He snowed iie a caole to^^iisking that «e pass a message to the
•Mn^ from the Deputy Assistant to tne 'resident for Sational Se'-ur1ty
'-\\'%. 'ne Tiessage lisured the m^r-'i vu- j.n'v rne 3ecr»rary of Sta">
-Id Anoassador Ja<ley *ere aware :ix tne operation. I told Jucnniewicz
ut I was jnaware of the specifics of the operation but due to the
jnsitivity of tne operation, it was appropriate that -e pass
irrespondence oetween the MSC and the amoassadors overseas t>ut only
irmunications, that we could not oe involved without a Finding,
25th of Movemoer, while visiting the Office of the
l^^jj«^r|||n^n^ad given Clair George a Spot
tnat^^g^^B^^^^iad -nade in support of the MSC
-eo: -.nrougn tne jveriea-j Do-^ifig ;ut tnat -..ner« ^as no Hi/
pmz -nvolved -n any mpleinentation :-" tnis lission witnout i
id-ng. ^r. .ucnn'^wi— jxolained tnat ^e 313 not naRa tne
-ingenents. *n^-\ ieneral Secord /i si tea the igencv ne -ried 'o get
ids on airl^n-s t.iat nlgnt oe a/ailaol- -.0 iwve iq'uipment to tne 'iear
•' ^".* '«c^''e ainion. ^e told nim we jid not have any such airlift
aoili-y. -lowever. Mr. Jucnniewici said it was poinded out to General
^^tha^her* #as 1 :oniaercial airlift tnat night do it owned 3>Hi|^
^■^■^■^ ieneral Secord then too* it from there and nade ^^^^
angementi for 1 flignt on a strictly ronwerdal oasis.
3. Somewnat listressed it this tun o' events. I iinmeolately
-.rTed 3ur ienerjl :ounsel ^tar :onf : -n- ng w^ tn Dewey :iarridge :ur
3 /ement. . -ist-ictaj --ne^^jerscmie; t: ^-iraed^atil / io :ver mc
"" •''* jene'i -Dunsal ina so aav-sai -.-5 Jens'i* ::unserj: i::i, -ne
'•-ig ;-■ :5 .o<-;-we-. ie infomed ne ' \-.ir -.nat nijfi: :nit 1 --naing
3 oe -«dui-e-:. not so lucn '-en -ne v' ^--. j-ancooint, out *r-:n 3ur
ive-nent -.n •nf?jeoc:ng foreign gove-nnent if-'ciaii to issist tne
:on, \ -■tnolng *as orepared tne nex: :ay. "he -•noing was cleared
tne Director ^no :ar,ed McFarlane ino Don ^egan to ascertain tnat
ed this nad Presidential approval ana to get assurances tnat a
ing ^ould oe >o signed. After reoaated calls to «JSC personnel on
ovemoer and iuring the week of 2 Decamoer continuously receiving
surancesjf tne President's intent to sign -he Finding, ^e were
1 on 3 Decemoer :nat indeed tne .-•noing was signed. The President
. js not to infom Congress for :ne reasons of the safety ind
I release k" :ne nostages until ne 30 3irected.
UNCMiWiarn
946
AJOJ r^
UNtUSSIflEB c 21,
ft;-'
Parlialty Declassitled/Peleased on.
under provisions ol E 0 12356
by K Johnson. National Secutity Council
loAovr-gft
UW
iiNimro
OSi!^
947
UNCLASSIF
Ky
C 220
%U> <^3 I ■
r.
The -following intormation comes from an Iranian source whcse ' "^
reporting has proven accurate in the oast, who knew the information
«fOuld reach the American Government.
niration
There is currently a terrcrist team living in his home, and they have
arranged for a quantity of explosives to be delivered there. These
explosives are to be usea for at least one or three planned contin-
gencies;
with
--Kidnap or kill 2 ^^^^ ^"^^^^B because they work
— Send a truck with several tons of TKT to an
The source has sources of his own ^^H^^^^^^^^^land stresses that
the event of any action against tSi^organization, it would be good
protect his people or person.
2. ^I^BJ^^^^^^^^heads
an^i^th^representative of KAODeini
to^|HPBIV^9I^H^HH|i ^^* o^ ^' most
wave of revolutionar^mulTahs
e 18 ,the successor
irsty of the first
wife is
ayatollahs in Iran.
^_^_^ His
ne of the most important
He works closely with;
t
B^rw^rFT-i
m
aii^
ship
them
to
Teheran
Partially Dcclassitied/Reltased onJi
under provisions of E 0 12356
by K Johnson, National Security Council
This is a friend of the Prime Minister, anH is
He
He- is sai^t^hav^thecapacitytokidnap people
-B
9-r ri;
60
0 1
/> iiri «.-^'
UNCLASfliFIFn
948
mussif
/IU«,M2
Partially Declassiliea/Reteased on_245le*v^88
under proviaons of £ 0 12356
by K JoDnaw. National Seemly Council
UNCUSSIfP
'wrfioyg'l
^ 230
. 1^
f\^
949
itussro
O
•hdJiu/
'\'\.
V-*-*. '^'v »>
2Jf"
tJVp -■:
-rmr)
Tnere are cnree mort or less discincc groups. We call cherr. Line;.
One, Two anc Three. All of Iran's internal politics, foreign
reTacions. econoir.ic affairs and social conflict can be viewed
tnrough tnc interplay among and between the Lines. The fortunes
o: inciviou,.. politicians rise and fall in accordance with tnesc
coniiiccs. anr. tne positions the politiciar- take anc public
"images" tney attempt to project are often cne result of
naneuvering to curry favor with one Line or another.
Khomeini has repeated and officially spoken of the need to
eliminate this "line plavinp." which he sees as causing contiict
between various groups (the Revolutionary Curds, the clergy, the
military, etc.). He tries to enforce some sort of loose
discipline over them, and in truth there are some fundamental
principles upon which they are all agreed:
--A theocratic Iran;
— The supremacy of the clergy in all areas of national '.
life;
--No separation between church and state; keep the
military out of politics.
the
Aside from this, there is violent conflict. Each line seeks
total elimination of the other two. While Khomeini lives,
conflict will continue in such a way that one one Line can
*■ ^ t- ^^ ^ ^ ^ ^^j .,. .-u. «.-w»_^ D..,. I J z ..1 .
the conflict will continue in such a way that or.^ -..^ ^^...^ ^^..
gain total ascendancy over the others. But once he dies, there
will be a savage struggle among the three groups.
Pmially Declassified/Released on^^ia^-Sg
Line Two: the hard-liners """e' pravrsjons of e.O 12356
by K. Johnson, National Security Council
This line is also Leftist in its domestic policy, and has
three times tried to get legislation to nationalize all of the
land and investment institutions. These attempts failed, thanks
to the strength of Line One in the Council of guardians and the
cooperation of Line One with Line Three.
Line One: the Rightist Line
950
UNCIASSIHE
2Z2
Tncsc- peopife nave coni>ioera^)ic r.'0»e:'
cne Council o:" Guardians.
ree
of personal weaiCh and^pTbieccion o: private invescments. They
are cocally againsc communism and in particular _che government of
the Soviet Union. They believe in friendly relations with the
West and with Islamic governments throughout the world. They are
opposed to attempts to export the revolution by force or direct
influence, and they believe in the principle of personal freedom
within the Rules of Islam and non-interference in the personal
lives of Che people and neighboring countries.
Line Three: Che Balancing Line
This Line controls a majority in Che Parliament . conrols Che
High Council of Just_ice , Che Supreme Court, and has certain
influence over the Council of guardians. Ic has further control
over certain revolutionary foundations. This Line normally
supports the foreign policy of Line Two (the export of the
revolution; terror, etc.) and tne domestic policy of Line One.
Key Personalities of Che Three Lines
Line One (Rii
951
UNCUSSIHED
L; ne Tuc '-i -d - 1 iners )
This Line "-is-the direcr ^nd roncinuous support cf rThr.mpini,
•-•■; rhou: <.-^.:-l-. rhe ocher cu-c Lines would make it ir.pcssible for
rhetr, to govern.
Sayed Al i V'-'.-mie (President);
Er.cineer ^': r'-;r sein Mossavi (Premier);
952
UNCLASSIFIED
Line Three (Balancing)
Ayacollah All Akbar Hashemi Rafsanjani (Speaker of Che House and
Khomeini's personal representacive on che High Council of
Defense)
953
vmssim
UNCLASSIFIED
954
UNCUSSIFIED
..;::•. .-ir.c: .:: .-r : nic-rnicc". iirv ic: c.b_i-.--.. .•.".: sur.i-:- o: ; •
iiiitTr.cil iconcri. Tnt mosC imporian; o: tni.-.--. '.••esponoc-c ; r.
wririnp. laving our che people he believed to t>€ leva', to hin.
and expressing his plan for cooperation vitn uf. .
^S6
W.:r. the nar.c of Cod
■.Strictly Confidential, please destroy it after reviewing. Date:
Tuesday, 15th Tier equal to 27ch shavalulmukar am 1^:05)
Wi ch regards ,
Reference to our discussion, from my point of view, if our
western friends do not do their utmost to find the best solution,
urgently and strongly supporting, assisting, organizing and
positively responding to Che requirements of those who are in
favor of theni and have Che same establishment of views and
thoughts and common goals, aims and interests in Iran (our line)'
against Che line of first line (radical excremists and leftists)
who have the support of fanatic religious people along with
direct and continuous support of Khomeini, and referring to our
long joint border with the Russians and their goals and
longstanding wishes, there is no doubt that Iran will face two
different possible fates after the death of Khomeini: either it
will be another Lebanon, but on a far larger scale and with much
more dangerous consequences; or within a few months or maybe
latest two years there will be marked gains on behalf of Russian
interests .
#
What is the solution?
Therefore, now without losing time and with special and full
attention and complete security, we must bring togecher and
organize in a unified scruccurc Che moderaces and patriotic and
pro-Western elements cnat are serving within the framework of the
present regime, even chough they are opposed to many of its
objectives.
Although our line is not officially registered itis very powerful
in principle, and we are jointly enjoving comriion cnoughts (Note:
this means chat they meet secretly and maintain concac: with each
other) and have verv close and tight r^^ationy within the
franiework o: the Islamic Re
955
UNCLASSIFIEU
Now afcer several years of waiting and expectation, we see the
good face of gentlemen and your green light for bringing up the
necessary reform to the country with the understanding that from
now on, our line has your full support and lacking which we were
expecting that for quite a while, so to ensure our line's
ascendancy and decisively carry out our coming reforms, we have
to have a detailed plan under prudent timing for execution of
this operation. Because it is a very important and sensitive .
subject, 1 will go to Tehran next week Co discuss and review the
outcome of our meeting with those who are committed in blood as.,
my brothers and are the top men of our line in several private ■
and joint meetings, and at the latest within a month I will be
able to deliver to you the operational planning for complete
execution in detail with all necessary support and requirements.
Please find enclosed the names of key positioned men and the
institutions of the supporters and operators of our line.
I sincerely request you to destroy the said list for the sake of
their lives and saving our common goals, aims and interests.
I thank you in advance and wish you godd health and success.
The List:
956
T^^, UNCLASSIFIED
C Z3B
IN
UNCUSSIFIED
957
UNCUSS
^39
In addicion Co his courier service, Corba also provided Che
following informacion:
Corba 's group has 100 Turkish passports, uses some Armenians, has
^00 Moroccan passporcs, cries not Co use Iranians for operacions,
recruics Iraqui and Lebanese Shiices. On che 27ch of May goc 30
Syrian expercs in air defense Co come Co Tehran (for a cocal of
32 in all). They are in Che markec for Irish, Greek, Porcuguese
and North African passporcs.
They had an operacion in London, and recencly 3 Iranians, 1 Brie,
1 Irish were arresced (had been printing Saudi Rials for che
Haj).
For this operacion they had paid 100.000 pounds down payment,
all, Corba'.<^ group paid 3 million pounds to Che IRA for booby
traps, bombs and passports.
In
'inni ^iT^Q
958
UNCUSSIFI
240
i<. kill nis cricici and opponcncs outsioe tn? coun-. r\ . anc ic
this end he ha^ given inscructions cha: sl-Mupariefi be muraered :
if Che proposed scam is carried ouc .
5. It is proposed chat al-Muearief f .
icies would be exposed
}e approached and asked to "play deac
for three months. Once his death is announced, the Libyan
organization will be identified and rolled up, the money taken,
and so forth. Then he can re-emerge, subjecting Qadaffi to
substantial humiliation.
959
UNCLASSIHE.
UOtumcAJT
C 24/
Ops)
D
C//A/<J58'r
960
22 April 1987
2 1 /9rA i-o
C 6267
Allen E/w
He. Arthur Liman
Chief Counsel
Select Committee on Secret Military
Assistance to Iran and the
Nicaraguan Opposition
United States Senate
Washington, DC 20510
Dear Mr. Liman:
In response to the Committee's letter of March 5, 1987, enclosed are
further copies of documents in which the Committee expressed an interest
after completion of a staff review. Copies are also being furnished to the
House Select Committee to Investigate Covert Arms Transactions with Iran.
For record-keeping purposes, I have enclosed a copy of a manifest
listing the documents by number.
We will continue to provide documents to you as they become available.
Sincerely,
/<v John A. Rfzzo
Deputy Director for Legislation
Office of Congressional Affairs
Enclosures:
as stated
Mlassilled/Released on.
Ztia.vw.S8
under provisions of EG 123S6
by K Johnson, National Security Council
UNCLASSIFIED WHEN SEPARATED
FROM ENCLOSURES
HH^KiSSro
iW
961
Miissm
PAGE X OF 1
DATE
I qZN NO.
ND
23«n
ND
SMOO
ND
2M01
ND
S<402
ND
2H03
ND
24QM
ND
2MQS
ND
SMOb .
ND
SMQ?
ND
SMOa
ND
2^o'^
2MD1/A-2M22
DESCRIPTOR-TO/FROn
C 6261
Partially Declassified/Released on^^fcJ^M 86
under provisions ot E 0 12356
by K Johnson. National Secunty Council
82-688 0-88-32
962
^.^^ UriuLnOuiiji ilM
M\mm
963
lliLHSSIFIE
N 9293
^ASF/WH3R/S00.GZ/Z2/327,i:'1272/ ID: OLN/NIQl ,WHSR//
Ihope the phone call helped, in looking at your
TB MSG I NOTE THAT_ I DJD NOT
DETAILS
FOR YR INFO h CHARLIE S THE ARRANGEMENT CALLS FOR TWO
THINGS IN RETURN FOR THE SHIPMENT BEING MADE BY OUR
FRIENDS: RETURN OF THE HOSTAGES AND NO MORE
qq^
PR^ TO GOD THAT THIS WORKS, FOR MANY
BB HAVE TAKEN GREAT RISKS TO SEE THIS
OF WHOM H NOW NOTHING OR ONLY PARTS OF THE PUZZLE.
, Z^A-voS
PLEASE 5HREAD AFTER READING.
B546387
WARM REGARDS. NORTH
Partially Oeclassilied/Released onj
undet provisions ot E,0 12356
by K Johnson. National Secunty Council
964
N 12086
^ /
Partiallv Declassified/Released on Zfa-^-e^' — 89
undef provisions of E 0 12356
by K Johnson. National Security Council
UNCLASSIFI
965
m^"^^
\M , [S 221
itussw
Soco
afiioiiy Ueciassided/Released nn 2.(='-^€k~^E
undef provisions of E 0 t2355
by K Johnson, National Security Council
^xr^7
966
RCON
(^
18 December 1985
MEMORANDUM FOR THE RECORD
SUBJECT: Discussion with Subject VjjX^t.^^
C 222
1. Subject requested a meeting with Chief, DO/EUR and NIO for
Xj Counterterrorism at 1500 hours on__4^ecen4)er at Headquarters. He explained
that he had just returned from Pans where he had conducted some unspecified
business. While there, he acquired certain documents and other information
that he believed would be useful in a collection effort that the NIO/CT is
conducting on behalf of LTC Oliver North, NSC Staff relating to the US
hostages. Subject also proposed a new initiative against President Qadhafi
and Libya utilizing certain resources that he claims to have at his disposal.
However, conduct of this anti-Libyan effort would require Agency support.
Chief, EUR recommended that subject provide details to the NIO/CT so that this
could be evaluated upon his return on 13 December from a trip to Europe.
2. Subject proceeded to inform NIO/CT of private efforts that he had \
undertaken with White House encouragement to establish contacts within the
Iranian government--contacts that were helpful in securing the release of Rev.
Benjamin Weir in September. He stated that he had urged National Security
Advisor MacFarlane (whom he served as a consultant) over a year ago to
undertake an effort to establish links Into the Government of Iran and that
MacFarlane had agreed that secrst, indirect contacts could be established.
The objective was to build bridges with more moderate elements of the
government in an effort to modify the extremist, anti-Western policies of the
Khomeini regime and to determine if these moderate elements were strong enough
to seize power. Subject stated that he was able to establish contact with
some key Iranians utilizing Israeli contacts. Including one Col. Jackob
Nimrodi, an Israeli who is Involved in the international arms market. Subject
would not disclose any details on how he met Nimrodi, although the latter
allegedly was at one time a Mossad agent. Nimrodi, who has offices in Tel
Aviv, London, and New York, introduced him to a Mr. Ghorbanifar, who also uses
the pseudonym Asgharl. Ghorbanifar, according to Subject, was once an agent
for SAVAK, but saw where the Iranian revolution was headed in 1978 and bolted
to Khomeini just before the fall of the Shah. Subject describes Ghorbanifar
as *a recruited agent* and "a good fellow who is a lot of fun". Ghorbanifar,
who has a family 1n France, apparently also has a girlfriend in California,
who is having some difficulty maintaining her alien resident status.
ISO k^tibwn as^ Subject described
'an action guy" whose responsibilities aret^procure arms for Iran on the
international market; he also claims that ^^^^^P runs a terrorist
Pariialiv Declassified/Released on J^£^<~-~g<2j
unaei provisions of E 0 12356
K Jonnson. National Securrly Council
82-G83
nr,
CO
CL BY SIGNER
OECL GAOR SISR VOL
0RC!)In
scod
967
organization In Western Europe.
authorizing the procurement of arms|
MlfliJBP^in the Office of the Prime Minister. Ghorbanifar and]
assert that the activities of Hizballah in Lebanon are managed out of the
■ime Mini<tpr'<; nffif.fi lhfi_Llnp nf ganlrol goes from that office in Tehran
over Hizballah. These Iranian elements know
hostages in Lebanon and can secure their rel«
so.
also had influence
group holds the American
do
same holds true for the four remaining
liostages held by Hizballah; if it is decided that it Is in Iran's interest to
secure their release, this can be quickly accomplished.
4, Subject explained that the four hostages were expected to be released
just before Thanksgiving because of the Hawk missiles that had been delivered
with intermediaries (who include, among others David Kimche of Israel). After
delivery of 20 of these missiles, Sutherland, Anderson, Jenco and Jacobsen
were to be released in West Beirut; once these four were released, another 100
Hawk missiles would be delivered to Iran. This did not occur because there ;
were disagreement^o^r the particular model of the Hawk missile that was
delivered.l^HHUpn 28 November was frantically trying to contact Majles
Speaker Ransanjani, urging him to reciprocate by freeing the hostages now that
the Americans had shown "good faith" by permitting the shipment of Hawks to
Tabriz. According to Subject, the disagreement appears to have resulted from
a misunderstanding on both sides concerning what SM^ific type of equipment
was requested. ^^HIHHHUflH^HI^HI^MiHI^^^
through interme^^ne^^^Hac^^Tn^that Iran was displeased because it did
not get the correct equipment. Subject stated that the Iranians apparently
had expected a newer, modified version of the Hawk system. According to
Subject, the opportunity to deal with Iran now is "excellent" because Tehran
is "desperate" for specific types of equipment such as the TOW anti-tank
missiles. He also noted that neither Iran nor its surrogate has attacked or
kidnapped any Americans in some months. The crew, for example, that had flown
in the Hawk missiles had not only been permitted to return unimpeded but were
given "caviar" to eat on their flight out of Iran. These developments auger
well for the United States and every effort should be made to exploit Tehran's
need for arms in order to build bridges with more moderate elements of the
Iranian government and to preclude additional attacks against American
interests. This was a long term strategy that the United States--with caution
and discretion--needs to pursue.
5. Subject again turned to Ghorbanifar. The latter, at great personal
risk, travels to Iran about once a month to discuss weapons procurement.
Ghorbanifar has even traveled to Israel--without Tehran's knowledge--to meet
with Israeli officials. All told. Subject has had about a dozen meetings with
Ghorbanifar in France, Switzerland, Israel, and the United States. In fact.
Subject arranged for Ghorbanifar to come to the US in October and actually
brought Ghorbanifar into the White House. As a result, Ghorbanifar enhanced
his credibility with senior Iranian officials, including Rafsanjani, who
believes that Vice President Bush is orchestrating the US initiative with
Iran. In fact, according to Subject, Rafsanjani believes that Bush is the
most powerful man in the US because in addition to being Vice President, he
was once Director of CIA. aiKi^^a a ^^^^mwmm»a^
., ,. ' JiwfiUJiJincn
968
C 224
6. Subjeoi^stated that Ghorbanifar had met with Agency officials in the
j)ast but that he found that CIA officers did not trust him. Ghorbanifar was
'extretnely reluctant to have further contact with CIA and stated that his
experiences with CIA "had been bad".
7. Subject stated that Ghorbanifar had proposed to him a
would discredit Libyan leader Qadhafi.
|the murder of Libyan dissident leader Murgiyah.
Ghorbanifar claims that this is an excellent opportunity to plan a "stino
against Qadhafi bv staoino the murder of Murgij
nccoraing to Ghorbanlfar's pi
Arrangements would be made for Murgiyah to_reappear after about three months
to expose^adhaf i's ijiten^tomurdei^nm.
Subject urged that the Agency seriously consider exploring
the possibility of supporting such an operation.
8. Subject stated that Ghorbanifar probably has a "limited life span" and
speculated that the Iranians may eventually take action against him.
Nonetheless, it was important to use fully Ghorbanifar's knowledge and
contacts at this stage. Subject noted that he would be traveling again '
shortly to Europe and would be discussing the proposed Libyan operation
further with Ghorbanifar. He was hopeful that, in the meantime, some reaction
could be obtained from CIA. Subject noted that he had discussed this issue
with Oliver North of the NSC •'ho favors the undertaking of this operation.
Subject claims that Ghorbanifar has good bona fides with!
^and that the risk of running the sting operation is "relatively
low". Moreover, in his view, the risk of exposing the US hand was eoualli
small.
10. Subject also claimed, without further explanatiors, that|
been recruited" and would do the bidding of those working on freeing the
American hostages.
Charles E. Allen
bll/VCSS'J
ORCON
969
UNCLASSIFI
C 225
Partially Declassified/Released on
iUle 8%
under provisions ol E.O. 12356
bir K Johnson. National Security Council
m^
f \\
500
rum/>-?<^
970
MTIinpAt'Olt'l
SiWECT: THp Iranian Political Seen*
C 226 '^^•^-^'^
('5^
."^"
"^\.
O. r-jur^^
..^^
1. Since Tate_nPi, the K^-onPini r«.oinA h^s Koen *ac1no..an'i nPnoti,n«
•lealinn effectively wit^— its n.patest chaHennes since cnnsoliH;,rim control
of Iran in nid-iqRl. Fart inn^l i^-i within |hp rpnimc gn^^ t;hor.pinrs fflilino
neaU^•, economic stagnation and f<winrt11no oil inco-e, war.wearm^ss .tnH ir;4ni
attacks contrihute'l to increase/I rtnnestic unrest, oonilar 'lenonstt ations
early this year anrt other sions of dissent h^ve heen nithlesslv sunnrossoH
hov/ever. and the populace seens cowed. •Moreover, KhonPini has intervenp'i in
the nolitic^l process to balance factional interests an/1 has oiv»n nr-f^rence
to nraonatic policies that weaken the radicals and strrnnthPn tr-pir moderate-
conservative opponPnt.s. Tehran has naintained oil Pxportj in thp face of
repeated Irani attac^s on Kham Islani and ensured th^t the lower classes who
support clerical rule are adeouately simpliPd with neressar-y ooods an^
services. The reoine's principal challenne in the near term will he to nana^e
ponular dissatisfaction and prevent it fron soawnino an effective anti-reni-'P
novertent. (S HF)
PRItir.lPAL PL AYE"?
Partially Declassified/Rele.ised on Z(jW~i
under provisions ol E 0 12356
by K Johnson. National Security Council
^Tt»-ijL.. .. "yi^ Jonnso
?. The Iranian leadership is split hy ideolooical. nersonal and
oenerational differences. One nalor faction, TKTTadicals 'avors nreater
oovernnent control of the econony, anoressive export nf fKe revo1(i*ion.-
includino use of terrorise— and continuation of the war, SnothPr nain
faction, a noderate/conseryativp coalition. seeVs to li-iit oov»/nnent
involvenent in economic natters, qenerallv onpnses violent exnort of the
revolution, and favors a negotiated end to the war. (s nFl
3. ^one of the nost inportant Iranian leaders—such as fhonpini's
recently named heir, Ayatollah «ontaz-H and Consultative Assembly Sp•a^•r
Rafsanjani— are praonatists who sunport the conservatives on so— issues anH
the radicals on others. HTomPini himself has increasinoly tended to fit t»<is
description and to suoport a middle course— excent on the war, which he
Insists must continue until Iraoi President Saddam Husavn falls "esides
Khomeini, the naior player-s are:
Oragmatists
^IWI^'T^^
971
uHWsra
C 227
— As<;e'»'^lv Soeakpr P«f$«n1«ni, a mifi.Uvol cleric in ►.<$ fifti»^"o >,;»<
»<1 as a sMIled oolitician and i^ now <»con^ onl^
972
4. Exiled opponents of t^^e r«>'?ine lack sufficient asset«i to exnloit \
problens. Thev have no leader or nroqran caoat>''e of c^allen^inq Kho-^eini's
charisna and ideolooy. ^xile oroups are fu»the' linitod hv rest'icto'i
contacts inside Iran, ninina'' popular sunport, and constant ^ic^^rinn a^nnn
thenselves. (S HF)
5. The nost effective onposition to the radical elen*nt^ of the clerical
reoine cones fron the noderato/conservative coalition within th« oovArnmpnt.
other domestic intPfest nrouns that are potential threats to anv forn of
clerical governnent 1nclu'<e:_ . ^
'jyjpjyj
<^^
973
UNCUSSIFIED
IN
full
UNCLASSIFIED
974
Al!en &>I?
10 December 1985
MEMORANDUM FOR: Deputy Director of Central Intelligence
FROM: Director of Central Intelligence
UNCLASSIFIED
0275
1. At the 1030 i^eeting today, Rud reported on his discussions ove"- '.He
weekend with Gorbanifenr In London, He did not have a good impression o'
Gorban i fehr and recommended that we not pursue the_Qroj)Osed relationshi p
with him.
2. Everybody supported this in our roundtable discussion. Other options
which Bud had suggested were to let the Israelis go ahead doing what they would
probably do anyway, and hope that we get some ^cnef 1t,^mimi^mi||^|ti|^^
H^^^D The President argued mildly for letting the operanof^^ahea^mhout
any commitments from us except that we should ultimately fill up the Israeli
pipeline in any event, or the Congress will do it for us. He was afraid that
terminating the ongoing discussions, as Bud had speculated they might, could
lead to early action against the hostages. The trend of the succession of i
this was that it was a little disingenuous and would still bear the onus of
having traded with the captors and provide an incentive for them to do some
more kidnapping, which was the main burden of the argument against going forward
on the program. /The President felt that any ongoing contact would be justified
and any charges that might be made later could be met and Justified as an effort
to influence future events 1n Iran. I did point out that there was historical
precedent for this and that was always the rationale the Israelis had given
us for their providing arms to Ir
Lain contact with any of the Iranians who turned -d
in^his affair who are willing to do business on the basis of exchanging
information and looking for ways to collaborate with respect to Iran's '.'ure.
4. As the meeting broke up, I had the idea that the President had -ot
entirely given up on encouraging the Israelis to carry on with the Iranians.
I suspect he would be willing to run the risk and take the heat in the '-ture
if this will lead to springing the hostages. It appears that Bud has fe action.
Partially Declassified/Released on 2^ fV>08&
under provisions of E 0 12356
by K Johnson, National Security Council
William J. Casey
liNCUWe
CL 3Y
SVW 0
975
mmm
Executive- Reg i-ry
««/0^«€
a&- 504B
Altenbv^aO
MEMORANDUM FOR: Director of Central Intelligence
FROM:
SUBJECT:
Chief, Near East^^^^^^^^^^HDivision
Meetings with Michael Ledeen/Manuchehr Ghorbanifa:
1. ^n the afternoon of 21 December, Chief, NE/j
contacted Mike Ledeen to lay-on arrangements to neet
Manachehr Ghorbanifar (Subject). Ledeen advised that Subject would
be arriving a day later than anticipated. He suggested we get
together at 1100 hours 22 December to discuss our coming meeting
With Subject. I OOP')
Meeting with Michael Ledeen
- During the 22 Decer.ber meeting, Ledeen reviewed his ' '
relationship with Subject. He said about a year ago, he (Ledeen?
had gone to the former National Security Advisor Robert McFarlane to
discuss the need for an Iran policy. Ledeen suggested to McFarlane
that he be authorized to contact the Israeli Government to see what
could be done in conjunction with them. McFarlane authorized this
contact and shortly thereafter Ledeen met Prime Minister Peres.
Ledeen added that Peres was very enthusiastic about working with
Ledeen and the U.S. Goverr.rent on the Iranian prooler and told him
about their contact with Subject. Two Israeli officials, David
Kimche and Jacob Nimradi, introduced Ledeen to Subject. Since then,
he has seen Subject 20-30 times, often in conjunction with Kimche
and Nimradi. It was from this contact that the operation developed
to have the Israelis at our behest deliver to Iran 500 Tow missiles
and, more recently, 18 Hawk missiles in exchange for the release of
all the hostages held in Lebanon. Ledeen is convinced that the
release of Reverend Weir was tied directly to the first shipment of
missiles. Ledeen went on to say, however, that he never really
expected the Iranians to deliver all the hostages given the
•Iranian's merchant mentality."
- The delivery of the Hawk missiles has been an operational
nightmare. There was a misunderstanding about the type of missiles
the Iranians were seeking. They wanted a missile that could hit a
Partially Declas^ilied/Released on ZUJ ftl*^
under provisions ot E 0 12356
by K Johnson. National Security Council
INTELLIGENCE SOURCES
AND METHODS INVOLVED
WARNING NCTICE
^rrv */7i^/£ 01
976
target at seventy-thousand feet and already had Hawk missiles in
their arsenal, what they thought they were "going to get was a
modified and advanced version of the Hawk. They are quite angry
about the delivery of the missiles and have asked that they be
removed from Iran as soon as possible. Their presence in Iran is
politically troublesome to the Iranian hierarchy. They are now
asking for Hercules or Phoenix missiles,
- Ledeen stated that at a recent high-level meeting which
included the President, Secretary of State Schultz and Defense
Secretary Weinberger a decision was made not to proceed with
Ghorbanifar in an effort to release the hostages. Schultz and
Weinberger reportedly were quite unhappy about this operation.
- As
Iranians a
Subject ' s
Sub]ecr St
returned.
- Led
man .... a
to the U.S
credibilit
hir. The
Q£era_tjjm.
SubjecL, h
Situation
lying to u
relationsh
understand
suggested
latest rev
Hqs area o
an as
nd ha
pel 1 1
ated
ide ,
d us
ical
he w
Ledeen noted
ed around $20
contacts ins
as holding $4
they had purposely ove
0,000 of these funds to
ide Iran. Later that s
0 million which the Ira
rcharged the
suppor t
ane evening,
nians want
I 0283.
een i
Inost
. to
y and
nur.be
Led
e con
( see
s, sa
ip wi
his
that
elati
n 6 J
s a
too
meet
to
r on
een
tact
Atta
ying
th s
rela
perh
ons.
anua
fan o
good
with
find
e ite
said
ed hi
chnen
he c
enior
tions
aps a
He
f Subjec
to be t
us in o
a way to
r in thi
that whe
m in an
t A) . H
ould not
Iranian
hip with
new pol
agreed t
t and describes him as
rue.* He had asked Sub
rder to straighten out
keep the relationship
£ latter area is his pr
n he learned of our Bur
effort to have him expl
e comnented that Subjec
reveal his source nor
officials. He felt we
the Iranian government
ygraph would be useful
0 a polygraph to be con
a 'wonderiul
]ect to cone
his
going with
oposed Libyan
n Notice on
ain the
t admitted
explain his
would not
. We
given these
ducted in the
- In closing out this session, Ledeen made the point that any
serious covert action operations directed against Iran using
Ghorbanifar should be run out of the White House not CIA because 'it
will leak from Congress."
Meetina with Ledeen and Ghorbanifar
- At 2100 hours, we met with Ledeen and Subject at Ledeen's
home. After a few pleasantries, we began to discuss Subject's
reporting concerning the "Iranian hit team* which allegedly is
USSIFIEO
977
SLlKj
as a secondary target. When we went over this a
reluctant at this neetinc to identify
source. However, at the meeting qji the ^^^U^S^^Jr^^
December, he identified his source as Ie^BJJ^HBHHI^BE^^^ This
is the same source who provided the false inf ormat ior^^st Kaich
concerning an alleged Iranian plan to assassinate Presidential
candidates which did not hold up during Subject's polygraph (see
Attachment E,
team, is very reminiscen
after investigation and polygraph, turned out to be fabricated,
is our feeling there are bits of valid information in Subject's
reporting but he has embellished and projected his own feelings in
presenting this information as hard fact. This has been a
presistant problem throughout the four years we have known him. His
reporting has sometimes been useful but it is extrerely difficult to
separate the good from the bad information. It is hard to find in
the file any instance where his reporting in fact resulted in a
solid development.)
UMEUSSIflf
978
I 0285
- Subject had no additional information to add at this time
other than the fact that th;
■ At this point in the discussion, we shifted to his views on
the current divisions within the Iranian Government. He described
them as:
line one - rightist;
line two - hardline;
line three - balancers.
He said that he would like to modify his earlier reporting
(Attachment B). He celieves 'line two" and 'line three* are now
working more closely than in the past. His reporting on this is not
very substantive and did not bring forward any really new
information. He said he is working closeJ.y ..with the 'rightist tine'
He said that the 'rightist group' is not easily discernable because
of the physical danger associated with openly opposing the
government. Because they are not 'visible', it is difficult to
measure their strencth within the Armed Forces, Revolutionary Guard,
iazar. etc.
:is point, he provided us wi
document
panaiysis ot the Islamic jinSfl. He said there
is new intormation and details in this document which our analyst
will find very useful. (Comment: While we are having the docum.ent
fully trajjslated, the translator's earlv impression is that the
cument
1
m
on tc
Idoes not reveal any new information) . Subject went on to s_a
that he could put us in touch with^^^BBW whom he describes as
supposedly wd
be willing to answer all of our questions provided we give Sub]ect
three guarantees:
DUiC
- There would be no harm done tc
lor his associates;
- That we would coordinate all our efforts with Ghorbanifar
and;
That we would suppor
979
msim
0236
He added that this
CIA. He described
for Iran. VJhen as
replied that we sh
What we are talkin
purchasing efforts
carefully and get
noteworthy that Gh
and he only raised
ago. )
- At that poi
^BHBHP). Sub
and has developed
descr ibed
the Regime? Ft sa
the
guarantee would have to come from the Director of
PfHjIB^^ being in charge of purchasing weapons
Ke^what^support^Hm^His looking for, Sub]ect
ould help him be^^ec^ve in his 30b. (Comment:
g about here is f acilitating^^HpE|||^^|arms
We told him we would reviev^^^^^port
back to him with additional requirements. it is
orbanifar's contact withU^BH^^^very recent
the idea of cooperation w^^^^^^^^V one week
v\
nt, we reviewed his rela^^nsw^th ^m^
^ect said he has known ^^^^P^or 2-1/2 years
^good personal relationship with hin. He
^^s a 'hard-line f undarentalist* who is loyal to
idi
used effectively in enhancing his position. Ledeeninf^r jected thei
observation that sub3ect has actually *Jnad^^^H^H|B^y his effect;,
in delivering n "^ilpfi *•" ^^'' '^ >• ^ " M fl r 1 ^I^^^^K 1 S ij)~.liked by tn
- Subject said that because of the negotiations concerning tr.e
exchange of the hostages for missiles, there has not been a
terrorist act directed against the USG since July. He implied that
this might change now that the negotiations have broken off.
- Finally, we discussed his proposed Libyan operation
(Attachment D). He reiterated that Qadhafi is very much interested
in assassinating Muhammad ( ( al-Mugar ief f ) ) . Libyan opposition
which the Libyans would provide $10 million in exchange for
al-Mugarief f 's demise. Subiect believes he would be able to extract
Lunds ^— ^^-^K^^-^^^^^-^— ^
?g^ ^He
NCUSSIHED
980
CLASSIFIED
' 0287
believes that when al-Mugarieff reappears, it would have a
devastating impact on Qadhafi's image. He proposed using the funds
($10 million) obtained from Qadhafi for joint operations against the
Qj ^^y other target we are interested i n . I^^^WM^^MM
Subject and Leaeer^nad^^^^^^ng pitch for a decision on
operation as quickly as possible. We told him that we__iiould
- Subject plans to travel to London on 24 December to be with
his family for 2-3 days. He has agreed to return on 5 January to
undergo a polygraph scheduled for 6 January.
- Around 2330 hours NSC staffer, Ollie North, dropped by to,saS'
hello to Subject and to talk wi^li_him about tjieproblem of
J*"- r i.evang the nissiles from Iran. We departed at 2400 hours and it
was arTanged to get tog'S'tli^r on" the afternoon of 23 Decenber to
discuss further sone of his ideas. (Comments: This latter r.eeting
took place as scheduled and the new information obtained during this
session is folded into this report -- spt»f i f i_ra 1 1 v arranoinc fhf-
ite for a polygraph and the identification
fas his source of terrorist activities in EuTop?
Kralis,
Subject is registered at the Madison Hotel in alias, Nicholas
I
981
SL'.Kil
MEMORANDUM FOB THE RECORD
SUBJECT: Ghorbanifar Polygraph Examination
' 0601
on the afternoon/evening of 11 January 1986, Ghorbanifar
underwent a polygraph examination. He showed deception on
virtually all of the relevant questions. He has
lied/fabricated his information on terrorist activities an^jas
tried to mislead us concerning his r e 1 a t lonsh^^ljU h <^^^J^mg
line inside Iran. He also has distorted^^HB^B^ role in
Islamic Jihad. Moreover, Ghorbanifar was tested on his
involvement in the deal to release the hostages. The test
indicated that he knew ahead of time that the hostages would
not be released and deliberately tried to deceive us both
independently and with ^HI^HHB \_^
Ghorbanifar provided new information concernin^r^lleged
terrorist plan to attack U. S. intei . -s inj^H^BHB^^ He
was also tested on this information and was shown to be lying.
It seemed clear from Ghorbanifar ' s behavio
realized that the polygraph test indicated dec
cor.nented during the test that he was comforta
the test questions, he said that perhaps the n
indicate some problems on a series of question
■■■land the rightists inside Iran. He said
b^^White House representatives' not to discus
CIA because the operation was 'too far advance
were involved 'it would require congressional
went on to add that he has supposedly expended
own funds for this purpose and has been assure
House representatives' that he will be reimbur
expenditutes. (Comment: The polygraph operat
Ghorbanifar's explanation/rationalization woul
the test results on the questions being asked
with fl^l| and his supporters).
in discussing the hostage deal, Ghorbanifar stated he was
very comfortable with the questions asked. during one of the
breaks m the testing, he commented that the Israelis rece ved
the $24 million as soon as the shipment was delivered and they
are holding all of the funds that the Iranians are requesting
Se returned. He added that the Israelis told hin that they had
r that he
eption. while he
ble with all of
achine night
s concerning
he had been told
s this topic with
d' and if CIA
briefings.' He
$800,000 of his
d by these 'V.'hite
sed for these
or stated that
d not influence
in connection
Pal;3lly Oeclass.fied/Releaseo on JJ^5
under prcvisfons o( £ 0 12356
by K Johnson. National Security Council
2G,-iAio88
Partially DeclassilieO/Released on
under provisions ol E 0 12356
'*,\liy tLJohnson National Security Council
WARNING NOTICE
INTELLIGENCE SOURCES
ANT) METHODS IN^'OLVED
^ZTAj^/ye /s O/
982
"doubled* the cost of the Ehipment apparently because the
Americans were involved. He said the Iranians were very upset
about the last shipment and might resort to terrorist
activities against U. S. interests. He remarked the Iranians
have been refraining from these terrorist activities cinc*> tttp
negotiations began. UoU2
Ghorbanifar is clearly a fabricator and wheeler-dealer who
has Undertaken activities prejudicial to U. S. interests.
Neither Ghorbanifar nor Ledeen have been advised about the
results of the test. Michael Ledeen asked that he be informed
about the results of the test as soon as possible. He was
called on the morning of 12 January and told that the polygraph
operator will be reviewing the results on Sunday and we should
have feedback about the test on 13 January.
m^sw»
983
imssra
— COMMENTS ON GHORBANI FAR' S POLYGRAPH
1. Ghorbanifar has been polygraphed by the Agency on three
occasions. Each test showed deception on the relevant
questions. In March 1984, he fabricated information concerning
an assassination plot against the U. f. presidential
candidates. On 14 June 1984, he was polygraphed concerning
information he allegedly had concerning the whereabouts of the
U. S. hostages held in Lebanon. All the Agency officers wy^n-z
■■■B involved with Ghorbanifar over the years have'°'-''J
recommendedtha t our relationship be terminated with him. A
burn notice was issued on hiir in 1984.
2. In his most recent polygraph on 11 January 1986, the
exarination showed deception on all of the relevant questions;
specifically he
(a) Li ed 'fabri Gated his informatior on terrorist
activities:
(b) Tried to ir.islead us concerning his relationship
with the "rightist line inside Iran"; '.
.distorted the leadership role ofj^^^^B
inside Islamic Jihad; ^^^^^^
(d) He showed deception on the question of whether he
was under the control of the Iranian Government.
The test also indicated Chcrbanifai knew ahf-ad of time that the
hostages would not be released despite our providing missiles
to The Iraniars. I'e deliberately tried to decei ve u^on thi s
issue both independently and with the collusion of^m^ i^"^
CxrAZ-^/yf Is Od.
MU^SSW
984
\mmm
OTTlf'ifo/ S ^J
985
■t'' ^--k: 2"^
foLf^MfH
13 January 198S
6H0CBMNlF/^/e^iS)
0607
il/LN u, wi.o
1^64 b) piovidmr
kiuliai-pilit of ■* '
adoiiiiistereu t'
bcLaOie of interest
plot to aSbdSS
i9b4. Ilowcvtr, a
topic shcweu decepii
rest>
. inafTri
s a 4 0 - y c ar\o 1 d m ale citiren of
caDe of ii.terest to ^Bl^^ dur i ng ^la^ch
with information regarding the
^^^citizen. liowever, a March J^84flB^M
on this topic showed deception^^^^^^ ago in
hen he claimed to have information of a
'^^^^ p 0 litica 1 figures during the Fall of
ne l&644j^|[^p administered tofl^on this
01'- «e4.W4AM
>Ci,1Ult
I tne
lUKrOofc:
^YC*M0H
uas reqij
irutlit uii.ess rcgarai
1^^ ^i^^HB ''ost-ages. C/
not 10 le aaviseo of
intei 1 orated .
PKOCtLUki.:
ested by Kh Livision to dc termine Qj^^^- C )
rig his inforuotion of or iiivclvement v.ith;
rists. i DEN D, and negotiations to releasi
the
declared that^^^
results, confronted, or /^\
y 19L£| Letweer. the hours of 1 Sf C ano ICCr
a flHI^V by examiner ^^HHBBI^^
le at a local hotel in 1. ashing, toi. , D.C.
n the hotel room. test site during the
glish language was used.
Deception indicated to thirteen of the fifteen relevant
vtuebtlons. Inconclusive to the renaining two.
Cc)
^\
M^^pHHI^^ whi
^B^H^^^reQairied ii
entile test.. The eni
hki^lllL,:
^^'accompanied ly wB^K^tt^> arrives on time and appeared
to be in fcood physical health. he said he was not taking anv
medication. M^^^explained to^^^tiiat testing would be
adcinis tered (in four phases
4-M^m,iO^
CT^A/ ^/f3U
O^'-
tie s
'CC&'
SECRET
Partially Declajiided/Reieascd nnl0'''^^d8
under p'ovisions o( E 0, 12356
by K Johnson, National SeCL;rit>' Council
986
:> i. C K fe I
Cc>
Miase 1 qut^tioi.^ Oealt wiihmB inforaation of or
ii.vol vcycnl -^^ th IbLN C. I'liase I relevant questions and
ai.swcrs tij^pear below:
A. hai 1 DLN C per bOna 1 ly told you lie is willing to
cooperate with ^m^ Ui te 1 1 i^enc e? Af.LI.LF: Yes
B. Art ) OL tr)jhp to ueceivc us abciul 1 DEN C's actual
uc'rcc of UitlueiiLe with IPEN L? Af.Sl-EK: No. I
ro
06C8
lestini, shoucG dcceptioi. to questioii b. (^uestion A is
1 ..coi.c 1 us 1 ve due to ii.cci.s i s ten L rfoCtions.
rhase 11 questions covered ^^^0 information of or
ii.vol vebicii t with li/EN E terrorists. Jjyj" inp pretc^j discussions
of questioi: F (aware of threats aga i nst^Hi|^^^^<l^^^ provided
vtr) basic and "new" j^f orma t ion about terrorist's current ij^iTLMJiAU
j-lans tari,<.tcd i i i 1 I^BJI^^ i iil i i|iii n i ^^^ggt i i i i iii_ n n PO r«*rT.
tills "new" ii.f onto t ion showed deception to all relevant
cjues 1 1 ons ^ L'^^se see "Ihasc \")_... ,Also during the pretest
cibcus s 1 oiff'^^^^ia id that in a cor.v ersa t ion with ITEN F that
iDk.'. F brai^Red that "e> group" (IIEN C) assassinated IPEN L in
'auii "we are very happy." Unable to locate
t ne ir i eal largest (ILLN W] , the hit tcair chose IDE? L. Fhase '. •
ifr^cxunt questioiis ana J^^^s answers a|.'pear below:
r^
Are > OL ir>ing to ueceivc us in any wa> about i hr
soLii-c cf iht n.fornation refurding the thrcc-nan tear
llJic itt.". G three-Dan hit tear.)? A.'.ii.LR: Ic- .
i.c t = ! u ;i.{ Lli 0). Loi.-L ased II/LN B terrorist, have you
del ibc: o tt ly fabricated an> cf the ; r. f c: r^ : j or: > ou
i.a\e ^rovi-ea? ANiLLK: Nc .
Did iDLf. F tell you the hamburg Teac (The IDEN C
three-Qian hit team) killed IDEN L? AKSWEF.: Yes.
tthcr than what you have t oj d us. are you aware
of ongoing plans target inf'^H^^^ persons or
.interests for acts of terrorism \ou are not telling us
about? Al^bKtK: No.
Testing showed oeception to cjuesticns C, E, E, and F
istipnj
Pnase iil questions focused on ^^^^ infornation of or
invojveuent with IDEN D. Ihase III relevant questions and
f^^Bansweis appear below:
0. Are you trying to deceive us about your claiaed
contact with iDHN D? ANSWER: No.
SECRET
987
h. nrt )ou i.yi''f ^0 occeive us whien claiming IPEN T
ai.d sciiior c f t i^^^^^^^f said ic have agreed ic
Ttbin.t siiowcu vji cejt 101. lo question li. Testing v.as
ii.L^^i.c 1 ui 1 w. to c;ucstion C due to incor.s i s tfia reactior.s.
-S) us
riiasc l\ e,utstioiis dealt with ^^^^ informal ion of or
1 ;.v o 1 voLit 1. 1 witfi tiie iic-go t 1 a t 1 or.s to release tf^^B^.os t a pc s .
^llase 1\ relevant questions and ^Hfl^ answers appear belot; n ^ f r^
(C\ uS ' 0609
i. Lid you liave prior knowledge that the ^^H^^^^os t a[;e5
woulu hot Le released at the conclusion cf the
i.egc t la tioiib ? ANSI Lk: No.
J. Liu ) OL anc ILlN i coojcrate together ic deceive
■^■^■P 1 n the hostage deal? /vNSl.LR: Nc .
I. Are ;. OL unoer coi.tro^ t: an> cificial orj. ai.i ;a 1 1 on
of t..e iLLf. E gcvei i.r,( .M ? A.'. I. Li.: Nc .
L. liC ;• OL i iidepciiOer. 1 1 > i.'lai. to oecc i ve VHH^^^^J i.rii.g
t,.e hostogc i.tgoti at i( 1. s ^ ANilVEK: Nc .
, C S I 11.
Sli
■ e^ejtici. tc quest 101. s I, ., \, anv' L.
i.Lvii.j c::.., leteu the f c ur^j hases of testir.g, and icaliziii;
pt h a I .■ L > I ^.oLL t ve; y thi i.g ^Bfc iec 1 ar ed ;. as leei. fabricate r,
■IBP : e t l: ..ec lo the "new" i i.f crLa 1 1 en atcut tericrist's
cur r(->jL j. lei: tarLeteii agi ; r.s i ^^■■^^.''^V.h i le discussing th
to; 1 4 ^^^P .a s occas ioiialX) ,£j as 1 ve and often reluctant t<
a n s w t r
S.S-C'R £ T
988
- (a
Nut oiily was ^^^ occab i oi.a 1 ly evobivi and oftrn rtrluctani
lo oiisucr quest 101. s ^^c c oii t rad i c t ccJ__hnn_^_el_f . Di-riuf the
Ic^ II. I. inf. uiscuss 1 oilrJ^^fcioid tl;a t
i.i.d
terrorist were
jicbti.t ui tiiib mcciiii^. Ul^I^O miiiuies later when .
ihg this s tor) , 4B^ f a i led to nei.tioi, the preserfcc 06'G
1 t (. 1 I o I lit
^
ri)
U54
k i iOLi aps of jilastic explosives to tcirorists to target, in
l.'sr t , ^^^^^B^fac 1 1 1 1 les 111 IDLN J. The following relevant
v,uestio).s and J^^^s ui,6uers appear below:
^
Last juiida> anu f.onday did > ou neet with T a 1 e s 1 1 r i a r, s
to tclk alobt their desires to t arge t^^^^^^ 1 n teres t
ii. IDhN J? ANSV.Lk: Yes. mJ^^
..asi L.bi.c£> afid f.ci.ui) did vcu a^Tce with 111 es<
I'ales^iiii aiiS to deliver, in part
A.'.Sl Lk: les.
yjc voL_l\ ii.c to nt about an> asject of the mectin?
I w 1 1 h tci ro: 1 s t s ? A.VSI.LF. : l.o .
.yC^P^
/■. t II. e cci..(. iL 1 1 cr. c f
iL.CdL'i\ lerii. ii... tt>. .
£«r^ini<u^<^
Listi ibui iohi.
Orig
ALL PORTIONS OF THIS DOCUMEKT
ARE CLASSlHtD StCkET
4f.S,;^,.C.»;E T
989
IDLM ITY l-liLLT
^H_l A Cil('l.l■A^I^AR , r.am;chcher
L'lOE: S/y,i':, Tehian, Iran
li;]_f, 1, Irai., 1 raiiian
lllU L
ibht. D . . . . ■.
ILtN L Islamic Jihad
ibLN 1-
ibL.'. G Hair.do' Kassani
iDLN h
iL.,'. i
iLtl. J Siudi Ardbia
iLi.1. K Irai.iir. r;t vo lut i c r.ar > CLircs
IDLI. i. .Ki.'i.AF ! , .■^c ;:
C6?7
ALL 1-Ci.ilCI.:. OK "il.lS DClU.'.LNT
Ai.L CL,.i>i,ih.LD SLCKLT
SECRET
990
*ussw
&'y^6^i0-
DC I
13 January 1986
Allen £c.-2f"
0273
The Israelis are moving ahead en their Tow for Hostage deal with the
Iranians. You recall that in Sporkin's legal analysis there were two options:
One for DoD to do it directly with the Israelis, the other to do it through
CIA. Sporkin feels that the nost defensible way to do it from a legal standpoint
is through CIA. We prefer keeping CIA out of the execution even though a
Presidential Finding would authorize the way Defense would have to handle the
transactions.
Libder this option the idea was that the Israelis would buy the improved
version of the Tow and ship the basic Tows they now have to the Israelis. The
Israelis would then replace those basic Tows by buying the improved version.
Unfortunately, there is not enough money available to do this. The Iranians
'■3VS placed S22 million in an account in Sv/itzerland. This is enough for the
basic Tows but for the Israelis to buy the improved version would cost about
S44 mil 1 ion.
Therefore, they want to use tr.e second option under which CIA would buy
4,000 basic Tows from OoO for $21 million. As far as Defense is concerned these
purchases would be purchased in general for CIA uses for assistancel
^^^^^^^rhe roney for the Iranian account v.ould
be fansferrea to the Israelis. '--. Israelis ..'c-id fc-:sfer tna: -oney t: a
CIA accou'.t to pay for tnis :urchcs=, provide tne Tows from DoO, ttie ship;ars
would move the Tows to the Israelis ■.-.ho would then move them on to the Iranians.
The Israelis would keep their basic Tows and the problem of upgrading then to
the new Tows wo'jld be handled in •--. ror-.a'' DoO Israeli "elatics":;.
leussinED
Partially DeclassilieO/Released on._
under provisions ol E 0 12356
by K Johnson. National Secuiily Council
991
4l»tASSiFIED
I am told that time is of the essence ;n getting this done^^^^^H U2 74
fe situation in Lebanon is dete^-iorating so Oat any ca'ay
:an see m the :'-os;ects of qetti'^q the lostaces out of Lebanon snould b=
992
m
n
y^sim
"''T/NOFOftN/NXONik.HcT/UKw
EXCLUSIVE DISSEMINATION
The Director of C«n(rj| Inlelligena
*iJhiri«u«l.DC.2H05
-b^
2 ^ O^'V rC>
National Intelligence Council
NIC 00473-86
29 January 1986
MEMORANDUM FOR THE RECORD
SUBJECT:
Interview with Subject
Subject's Relationship with CIA
1. On Monday, 13 January 1986, I spent five hours with Subject, an
Iranian national who has had sensitive contacts with senior officials of the
National Security Counci 1. «lanet"With^ubjectlBljtfiej:£questSDf aheTBCiain
T3rderxtojassess^uWectJ..s_:l5cess^oJranian:£o¥firn^men_tjIeaderj3n(Jjaoj.btain
f rom :MmTlnf ormation3hat Jie .l:laMins3oTp^re"ss3rr5eaLOJlLst3\etworlcs-. The DC I
request came after Subject had failed a polygraph examination administered by
the Agency two days earlier. The purpose of meeting with Subject was to
obtain a general overview of the information he possesses, not to conduct a ■
detailed debriefing.
2. Prior to discussing specifics, 6ubjectstate(fahatj4e>an.tedjto
exp 1 aT n^Js^pr jor xel atl onsTin th "Ihe :^ency ,'2tbic!lJ'e jLejTDed^^
wnsati^Tactory"" He stated that he cooperated with Agency officials from 1980
to 1982 but, because CIA only wanted to use him as another source, he decided
to cut off all contact. Hextitedjthatthraloes"aiolTwant"3ito"*e'^n'*mployee?'
not j ng sthat 5>eTi rc^raurTrac e/^jrjD ject jman . " ^le glajms3thjt:t>eireverj'equested
iijnd.sjtf rom Tthe^gency 3)ut"aha"t Jils jpnjy ajltecgst rin :cooperatinq'y1 th 3 tJlira533to
f i ad JB upport JtfiJCh angt ahelEx^refTi s"t aalurTSf -ahe"3ia rdlirie"ane"a calJErg line"a3'f
^atgJJadjKhOineTnT. He claims to have suffered as a result of his breaking
the Agency because Ci All rTfoTned0||HHBPHIBH||||HHVHBI
^at^ubjectlBassiot «to be a:rusted . As aconsequence^ubject stated that he
"retaliated" by ensuring that some of his Iranian contacts stopped their
relationship with CIA or that they fed the Agency false information.
^-7
Partially Declassified/Released on_2tJ^'0 88
under provisions o( E 0 12356
by K Johnson, National Security Council
;>..- /i.
993
4. In essence, Sabiect«tatedtthat#iearasgeQuestinQ^U-aiore-!Princ<Dlea'
^pprp^gh ^owards'gilgraYahFaQencv. His major reason in asking for a
relationship with CIA was to seek its support in a long-term effort to modify
^aeaKhqffiein1»-eq1me"ahJCh:^hroaqh'a^ts^ad1cal:'^und
opeira r-^n 3t5Xo v i elU fiT 1 uetic e ^r-Uven"^ i r ec t"n n^ e r Vent i orr. ^n'^Obl ett U syjew .
^£iiaBia5t«ligT>"atSelfJinth-«he~3*est. The United States must lead the effort
to preclude the Soviets from controlling Iran. Subject stated that he can
assist because iie»irSecr'etl)ripart araheltonsecy.atlyg "gi-lne Dae mfjgtlfflran
^ran ithatg^^poseS tth^I'llne'yws'Z^roijp^hlch'Il^ehemeii'tiy^Tr^P'octs'S" _
fundamentalistTlsJamlclIran jndr"?avors ^1ts"ixportTtoT6thetilsliimAc3rountf1e??
In cooperating with the Agency, Subject stated that "he and his organization"
would pay for the operations they conduct. Once, however, he and his group
have completed a major operation with Agency support and endorsement that, for
example, "saves the life of the Crown Prince of Bahrain," he would expect that
his organization wou1djec^u^^substan^^^5um^o^^nevj^^Le. millions of
return fro1^^^^HH||^HH|^H^^^^^^HH^^The
be used to support his grou^an^t^aavancetn^caus^of Line One.
Areas of Possible Cooperation
5. Subject stated that te«isr»ed3to>orJi; with :the :US:£overnmento?rd £IA
in.^'rfiumber.^f^reas^ Clearly, the iiSJuaslageLtfieldarTSLainon were a high :
priority. He would continue to work with the White House on this issue; this
effort would be kept separate. A second area would be to asststStheTWeStllo^
blunting ^rarnan^erforism'. A third area would be working with the Agency to
tteartilby artan d :Syr.1an-?ponsored ■terrorisitL3Bratte~as~slst*Tn ^he overthrow "of
iA bvan jj eader^a'dhaf i ;
interrelated: hostages and the futur^ours^^ranian terrorism directed at
the United States. He claimed thatU|^^^J^J||smjneimalS.tfli:^iCiHose1h
Mus^y-i^lChamenelT^nU y i riT5tey35Tg)ffSngHIIB<ezraJ?z aaeh'gii^Tl Ml6l'€SiCS'
isoon ;un less^rriangementglagain ^roceeg!!Ejt3t!Le3lBite.d.StatgrSO-^upp ly^argTs
triEpOgh'SntiTTSed T aT3 eTSf i TF!^ sf3Fl I"3(53 r^ . All three Iranians have told
President Ali Khamenei that the CnTtgggtatesysTgllllnQ'aaiDrovide
soptiiftlcated3JS«annsilo^ran' in return fo^Te^^'s promise to secure the
release of US hostages held In Lebanon. JH^^HI Musavi -Khamenei, and
Aqazadeh had assured Khamenei and other senior Iranian officials that a
ipngagfSTFirtionsM p^yTth"ahra)rii tea 3tat6ra«ra"s:3)ein9:3ievsiopea: i^rs
con sjeq J6rtt6.TUehran'^r"aeTeg 21 r.aal an^efrS ^ 1 s tielements it qjx e as e_att acking "US '
persolinel ^gf^aci 1 ItTeT. <n ffjigt 7»»o'!ittaclt s'Sponsored 2)y"aran":i>aveTbccurted
agalnst3the"DSSforSeVerOnonths. Subject stated that "the Islamic Jihad
Organization (IJO)" would strike soon unless a new understanding was reached,
perhaps as early as 24 January.
7. Subject stated that he had convinced the Prime Minister and the
Minister of Oil to trust the United States with Israel acting as an
intermedi ary . AcaTr«iarfi5hOWmag'(5oa3fa1th'ia)y3>ayiD9-dn advance Jtgnns
<lP^Xyprip<**"'^"vpmhPrr^allhen^ahe^gooas^^Ha^wkaurta^cT?to=Til^anisslle5>'a^riYed
<iD Jate"»ovefflber,'^heyTJereTan'Zo1d JfodeJivsoiting ipux.:t1n>esjlhe":?rJce
"orig1,na.lJ^"j3gree^ Tjpon.TrrJhe"li^3nlss1Je.s_^re^triJ^-at2rehran -International
AirporJ,'*:awTiting'"pickup for jTlurrT^o^he -West"7*~the""Prime Min'fster and ^
others believe they "were cheated." In fact, nine of the 18 Hawks have the ■^"^'"^
n
SECRET/N0F0RN/N0C0N><WtMManLIU?9il !f ?' "^''°
imniJIOOirirt^
»USS!f!E
82-688 0-88-33
994
star of David Inscribed on them. <Ob34f tCtlted ttfuttlttej^asitoIdXhe^SrlJDei
Min1st«rathat,^tm1e«-wgiTrenerrtWTth-lthe^nU6<J KtStesilsTl'eithfed Jby;
24a}anaaryi^e'an)Trtd sra^Iongeran Sh'Stff^TrTeTK^in'il ntermedi aryanjfiea Uog
withaheXJmie35Tale??
8. As far as his personal s i t uaUorMjas concerned. Subject expressed no
serious concern. MusaiOLSlL^ia'neneJHpilflPi'^ndj^qaz^dehjlJjpyf^e
substantiaV-sums jrfjgioneV. |B|^^^B|5!ore^erv»I>as"a)een1phdto'gfaphed An
compromiTing'sttuatiAns:witW*esterrrvomen7'an:actiY.ity3that >(ould3'inish Jilm
with the :<home in i -f undamenta 1 ist.taovernment yere "J t '.toT)ecome3cnown . Even
though all th"ree individuals are identified with Line Two and have blood on
their hands, he has np fear of them. 4<hata:onc6rns2SubJecttls1that,'Saf^a1lcS'
br«l:l3own-«v*i th^hl^n*"! le'd :States.~7T^espread terrorjst ?5ctl v1tyT?1 1 1 rensJe.
9. Subject stated that the':3'rJ(h6">1inisterISf'a"s^eady:to:3ccept'!US
assistance.^jnilitary.advi^eT^and "^nTiriofficlaT JJS 'presence~3n"Tehrjn J)ut ithen
thei'xheating"th1ng'.occurrVd "1n~.lrte'7<oVemb'er to Musavi-Khamenei 's dismay.
Thejpriginal-l'lanxas'^forjran to\try .to :xle 1 i verjnot jn 1 y .the "ijye liS iiostages
but;the'.twoTJewish~6nes as"'we11.' ■A'*Jterrorist'Warijnayjip,w, ensue. Subject
spoke of activism by Shiites in Pakistan as being a particularly worrisome
source of potential terror against US interests. JheTIranianiRevoJutjonary
GuarJ j:orpsi(IRGC) 'can^Texert "control 'o ver_:the~5h lite "tap tor SDfithe
AmerjcansTSSAl 1 "thafi s"Treqinfe"3 'fo~r~the~Amertcans'^o"^e?rFe"g ^s'lypr .Prime
Minister31usavl-l(>iamene1^o^1s'sue^rroraer-and"lhe^RGC-will secureTtheltj
release.
10. Subject state^ha^hpissue of the hostages could go either of two
ways. Musavid^hamenelH^^Hhand AqazadehTCOuld.enjujiejtheJioslaaesj^re
kilLe4itin^^gj;;eemejit VUh^^ .~7Xo7iVerse 1 yTgthey jpu.l d
ensure release -of -the hostages -if proper Tagreementsiare -reached. Subject
noted that he feared the Soviets would attempt to take advantage of the
current factionalism within the Iranian regime. For example, thieJSecond
hijhest3ranV1ngT5ffina1'tln~!the~W1nTstry"2)f iFore1gn"^ffa1rs"S;NFJ)y3iiay3)e
sympathe^rcTto^he"5ov1et-4JnionT The United States would be wise not to let
this happen; cooperation was essential to ensure that Iran moves towards a
more moderate course.
995
Iranian Terrorism
14. Subject stated that he had four sources of Information on terrori
^emanating from Iran. His first source was, of course, j^
IP^^m^H^HJHKt He m^nt^n^^^ect contact wTxrr|^^^^ who
a terrorist net of 20-30 peop|flHp||^is an extremely "dangerous
individual but Subject can contr^^mi^^in fact. Subject has paic
large sums of money and has information by which he could blackmai
if necessary.
996
23. Subject stated that his current relationship wit^^^^^^Vis to
assist th^latter with procurement of arm^fo^Une Two. Heu^mea to have
assisted^^^^^^^in obt^run^arms fron^mi^ In one Instance, a plane
load of weapon^was held flp^Hk^butSub^^ intervened to get the plane
released for transit on ^^ehran|H^Qf^was grateful for this
accomplishment.
24. Subject related a number of instances where he had intervened to
assist Iranians in dif^ij
indebted to hi
997
The Syrian Connection
26. Subject claims that both Syria and Poland support Iranian terrorist
networks through the supply of arms^
/>(5nM^ft^l)Co^cT/oRcoN
998
999
36. The IRGC has devel
should it become necess
Ian for
38. In closing. Subject reiterated his willingness to work with the US
government, not as a controlled agent, but as an individual who controls key
assets inside and outside Iran that wish significant change in the government
and needs US support. Subject made It clear that he and "his organization"
wished to be reimbursed for ser^ce^rgndere^inthwarting terrorist acts.
For example, he stated thati^^HHHHH|H|^B[ ^^°'^^'^ provide him with
handsome rewards (i.e., million^o^u^o^^^^^^he is able to warn of and
assist in i-ho nrauonfinn nf attacks On Gulf State leaders. i
39. Comment: Subject is a highly energetic, excitable individual who
possesses an extraordinarily strong ego that must be carefully fed.
Intelligent and clearly an individual who has made a considerable amount of
money in procurement of arms and in provision of "otner services", he is
relatively straight forward about what he hopes to get out of any arrangement
with the United States. He deeply resents "his treatment" by the Agency in
the 1980-82 timeframe and frequently speaks scornfully of a woman with the
name of "Lucy" from the US Embassy in London who met with him at that time. A
personable individual, he also consistently speaks of his love of Iran and the
need to change the composition of the current government there. It is
difficult to gauge just what Subject's "organization" consist of but he
appears to have influence over or business arrangements with a substantial
1000
»
number of Individuals in the Middle East and Europe and inside Iran itself.
We have hard evidence that he is clos^^h^Hm^linister, the Minister of
Oil, and other senior officials lil^e^^^^^H^B^ There is no question,
however, that he exaggerates and inflates ror nis own reasons some of his
relationships. He is impatient if one tries to pin him down on the specifics
of some of the complex plots that he describes. For this reason, the best
strategy is to go back over details in a series of meetings so that all
aspects of the plot can be determined. This indirect approach talces time but
builds rapport with Subject. The worst approach to Subject would be to
attempt to lecture him.
■Yiri. Allen
UNCLASSIFIEI
SECRET/NOFORN/NOCONTRACT/ORCON
1001
m'iiA^^^ ■
ILESTONES
Men E)^''^^^ '
Executive decision to proceed.
Negotiations with the accommodating 3rd party and
ultiT.ate recipient regarding shipment, delivery and
payment .
Possible scenarios;
0405
Arrange transportation/shipment with cooperating
intermediary.
Equipment will not be shipped directly to X, but to
a cooperating intermediary.
The Agen^ will receive payment in advance from X
for one-quarter of the equipment.
The Agency will procure and deliver to X
one-quarter of the equipment.
After X receives one-quarter of the equipment, X
will turn over to the Agency the materials it has
been holding.
X will then provide the Agency with funds for the
remaining three-quarters of the equipment which
will then be procured by the Agency and delivered
to X.
Funds will be transferred by X from its Swiss bank
account to a foreign bank account established by
the Agency but with no Agency overt connection.
Funds will be transferred from the Agency's foreign
bank account to the military in a manner consistent
with the military needs.
CIA initiates Economy Act Transaction with DOD
(statutory authority attached)
A. Prepare Economy Act Agreement
1) Oral or written
Discussions with military to ascertain how it
needs to book this transaction with respect to
sale of its equipment and receipt of payment
for the equipment.
■■►Declassified/Released on Zfc-' 4)0 g^
under Drovisions o( E,0 12356
by K Johnson, Nalional Security Council
1002
2) What level within DOD
-~3) Overt or classified transaction
B. Arrange for delivery of equipment to CIA custody.
Establishment of shipment mechanism and necessary
liaison with military.
0406
1) Prom where to where
2) Mode of transport
3) Schedule of delivery
C. Agreement as to method and timing of payment to DOD
1) Type of payment (cash or check)
2) What will be the recipient DOD agency
IV. CIA initiates positioning, or delivery of equipment to
ultimate recipient
A. Nature of activity
1) Overt - (military transport to accommodating
party)
2) Covert - Proprietary
B. Prepare for equipment movement
1) Location of deliveries
2) Schedule of deliveries
3) Mode of transportation (black or white)
DOD transport
Agency owned aircraft (Proprietary)
Conunercial (charter)
4) Number of shipments
C. Prepare for movement of funds
1) Establish throw-away bank account for receipt
of funds for procurement
mussro
1003
mssm
a. (Who will do It)
~^ b. (Where)
c. (Nature of Account!
1. Proprietary account
2. Nor.-proprietary account
3. Corporate/personal account I 0 4 07
d. Role of Office of Finance
V. Prepare plan for receipt of reciprocal items
VI. Prepare plan for shipment of remainder of equipment and
receipt of balance of funds
wmssro
1004
17 January 19S6
2:00 DRAFT
1. Equipment will be procured by the Agency from military and
in turn delivered to X.
2. Equipment will not be shipped directly to X, but t|o a QAQn
cooperating intermediary.
3. The Agency will receive payment in advance from X for
one-quarter of the equipment.
4. The Agency will procure and deliver to X one-quarter of the
equipment.
5. After X receives one-quarter of the equipment, X will turn
over to the Agency the materials it has been holding.
€. X will then provide the Agency with funds for the remaining
three-quarters of the equipment which will then be procured
by the Agency and delivered to X.
7. Funds will be transferred by X from its Swiss bank account
to a foreign bank account established by the Agency but
with no Agency overt connection.
8. Funds will be transferred from the Agency's foreign bank
account to the military in a manner consistent with the
military needs.
9. Equipment will be shipped out black:
A. Agency procured charter.
B. Existing Agency-owned aircraft.
C. Military transport (requires discussion with military).
wmsmi
1005
IWeUSSIFIED
TO BE DONE
1
Discussions with military to ascertain how it netdt to book
this transaction with respect to sale of its equipment and
receipt of payment for the equipment.
Establishment of Agency foreign bank account for receipt of
funds for procurement.
0409
A. (Who will do it)
B. (Where)
C. (Nature of Account)
1. Proprietary account.
2. Non-proprietary account.
3. Corporate/personal account.
D. Role of Office of Finance.
Establishment of shipment mechanism and necessary liaison
with military.
Arrange transportation/shipment with cooperating
intermediary.
1006
w^m
^?TTOTTS~"
1. Use CIA authorities to acquire new weapons from DoD and
then pass them through Israelis to Iran.
0410
2. Have Isri€li« pass the weapons they have and we replace
t'lrera with new ones.
Pros
i \J iA
Pros
There's precedent/authority -''^i / /j i
No FMS reports needed /
No unnecessary overlap between FMS and covert action
It's a straight covert action operation
Cons
Failure to report raises political sensitivities
Argue it's
for U.S. )
-- Don't report unde
to use covert actid
Cons
-- Means withholdino/n
(i.e. PMS and oVers
(Israel acting only
t would frustrate intent
ies are broad enough to handle
by current law
t\o laws instead of one
even though
■discussion under FMS
PI
umm
1007
; -p ZP,*Jii,
1470
46 9611169 ASP^
PA
TOT: 1
AC^Oh
JAN 86
DIRECTOR 696S5I*
S E C R
STAFF 1
TO: PRI
h}W & -2^
SUBJEC
REF: DIRECTOR 6S2b86
12 JANUARY
TEST INDICATE
THIS REPORTIN
END OF MESSAGE
_ UNOERWENT Af^BHi^EXAMINATION ON
NCERNINC HIS RECENT TERRORIST REPORTING. THE
-- -N TO ALL RELEVANT QUESTIONS RELATJNC TO
~ NS NO FURTHER CONTACT WIT^^Ijj^
DECL OADR ORV HUM U-82. ALL
SECRET
Partially Deciassined/Reieassd an 7fciA-a^>'-^6
unaer provisions ol E 0 123S6
by K Joftnson, National Security Council
CLIth/ IO^<^
^/^W/flffl
^iim^
/^Sc
^SSC
1008
B'iSSm
21 January 1986
Ah(\ &*^0
MrMOR.^NDUM FOR:
FROM:
SUBJECT:
Clair E. George
Deputy Director for Operations
Sensitive Support Requirement
QC
1. The DDO requests that, in support of a sensitive
requirement relating to the hostage s i tua^^r^fo^wf^chan
approsriate Finding exists 4^^^^ provid^^^|^m^^^|^^H^^
^■Mfl|^^|^^^a pocket tape recorder t^Colon^lOl iver North
of the Nat ionalSe^^^^y Council . This equipment will be
turned over by^^^^^H|^on the afternoon of 21 Janaury with
the under s ignedp^sent to ensure that no inappropriate
additional requirerents are levied.
2. vour speedy reaction to this sudden requirement is, i
always, very much appreciated.
P3«yOeclsssir,ed/Re(easedon2t4«^
under provisions of E 0 m^
5old
dTlAj ^/f¥/s
01
1009
O/OCI
.OUTGO I M
DIRECTOR 705774
I 0566
U^fy02'b
Partially Declassified/Released ohi
under D'ovisions ol E 0 12356'"r^|j„j^
by K JoAnson. National Sscunly Counci/
SUBJECT: PRESENT STATUS IN SAGA REGARDING THE MOVEMENT OF TOW
MISSILES
PLEASE PASS TO DCI FROM DDCI EYES ONLY AT START OF HIS DAY AND
PLEASE CONFIRM DELIVERY.
1. A NEW DIMENSION HAS BEEN ADDED TO THIS PROGRAM AS A RESULT
" MEETING HELD IN LONDON BETWEEN NORTH AND GHORBANIFAR. HE HAVE
N ASKED TO PROVIDE A MAP DEPICTING THE ORDER OF BATTLE ON THE
*»AN/IRAQ BORDER SHOWING UNITS. TROOPS. TANKS. ELECTRONIC INSTALLA-
TIONS. AND VHAT HAVE YOU. THE GAME PLAN IS FOR A SEGMENT OF THE MAP
DEPICTING A PART OF THE FRONT TO BE PASSED TO SHOW OUR BONA FIDES
AND THAT HILL START IN TRAIN A SERIES OF EVENTS. WHEN THE MOVEMENT
OF THE MISSILES TAKES PLACE. THE REMAINDER OF THE MAP HILL BE PASSED
AND THAT WILL PROMPT ALL THE RECIPROCAL ACTION ON THE PART OF THE
IRANIANS. TIMING IS FOR THE FIRST SEGMENT OF THE MAP TO BE
DELIVERED LEAVING HERE TOMORROW. SATURDAY. 25 JANUARY. THEN ON THE
9TH OF FEBRUARY. A THOUSAND TOWS WITH THE REMAINDER OF THE HAP AS
THE FIRST TRANCHE OF A 4.000 COMMITMENT.
2. ME ARE TO GET THE TOHS FROM THE US ARMY AND ARRANGE
TRANSPORT OVERSEAS.
3. EVERYONE HERE AT HEADQUARTERS ADVISES AGAINST THIS
OPERATION NOT ONLY BECAUSE WE FEEL THE PRINCIPAL INVOLVED IS A LIAR
}AND HAS A RECORD OF DECEIT. BUT. SECONDLY. WE WOULD BE AIDING AND
jABETTING the WRONG PEOPLE. 1 MET WITH POINDEXTER THIS AFTERNOON
•TO APPEAL HIS DIRECTION THAT WE PROVIDE THIS INTELLIGENCE. POINTING
OUT NOT ONLY THE FRAGILITY IN THE ABILITY OF THE PRINCIPAL TO
DELIVER. BUT ALSO THE FACT THAT HE HERE TILTING IN A DIRECTION
WHICH COULD CAUSE THE IRANIANS TO HAVE A SUCCESSFUL OFFENSE AGAINST
THE IRAQIS HITH CATACLYSMIC RESULTS. I NOTED THAT PROVIDING
DEFENSIVE MISSILES WAS ONE THING BUT WHEN HE PROVIDE INTELLIGENCE
I THE ORDER OF BATTLE. WE ARE GIVING THE IRANIANS THt WHEREWITHAL
'aiiailv Deciassitied/Released on_L|ffe62@
unrtei orovisions ot E 0 1^356
bV K Jotmson. National Security Council
ilNDMfiSm
ET
COPY f 001
1010
UNeiASsm
TOT: 2
JGy02
JAN 86
DIRECTOR 705774
^""0567
FOR OFFENSIVE ACTION.
4. POINOEXTER 010 NOT DISPUTE OUR RATIONALE OR OUR ANALYSIS.
BUT INSISTED THAT IT WAS AN OPPORTUNITY THAT SHOULD BE EXPLORED. HE
FELT THAT BY DOING IT IN STEPS THE'TlGST *E COULD LOSE IF IT DID NOT
REACH FULFILLMENT WOULD BE 1.000 TOWS AND A MAP OF ORDER OF BATTLE
WHICH IS PERISHABLE ANYWAY.
5. WE iRE NOW PROCEEDING TO PREPARE 'HAT MAP AND DELIVER IT
TO NORTH AT nOC SJ^uRDAy MORNING WiSHjNGTOK TIME.
6 : ^iJi R£:D '-it SIGNED ciNC'NG DiTc: :7 ^iHlji- ■ '986 H'-ICH
:;/ES l£ T'iE Au'-'C'l'' *; 00 «--T Tnt NSC IS 'k".* -Si' IMG -ENCE. IN
SPITE OF OUR COUNSEL TO THE CONTRARY. '^E iRE PROCEEDING TO ?0LL0W
CUT ORDERS AS 50 AUTHORIZED IN THE FINDING.
7. NO FILE. DECL OADR DRV HUM-4-82
GRIG: DOCI 'MCMAHON i:55i
;nD of MESSAGE
ALL TOP SECRET. >
WMM
1011
•■'IB
2^ s7^^fc
C 3991
e/1
Ex, ^32
CASSMaBHS"''*^ 'Ghorba' (HC «2)
Pam&h M. Glli^tenifar (Ghor) and Charlie Allen (Charlie)
(lQetia«l Ledeen later joins then)
Da^t 25 January -1986 ""ae' prowaons of e o li^i?
"" ' "I"' Johnson Wat,nn,r o .
Pamall), Oec<a«,f,ec</Re:,a5.rt en 2U/W088
"naer prowaons of E 0 iris '
J<"-nson, Nanona, Securi./councI Z' /C/^/^
^///Z^/j>V7/^
1012
OocoHgoxs
-fheu.
^
ttWV^^^«®
Charlie: Beneficiary?
Ghor: This is, i s^^^^^^HH ^PO liere is whc
they have to pay us. I mean toCovc organization. Why we, we
need this money, we need for thfc^-inqing of reform in Iran.
To help Ollie's for his costing||Bbouth America, (laughter)
and, to rout all terrorism network in Europe and in Iran.
Charlie: Yeah. By carrying this off you'd expect a large
donation fr<
CO
/-o?
1014
ONCUSSIFIED
Charlie: I have some, some fresh fruits. I'lf^^t sone grapes
if I may. That my. my little daughter and I ^ grapes a L.
Apple will bo good, too. Thank you. Ghor .
Ghor : Here (sound of pounding)
IINCLASSIFIFO
1015
UNCLASSIRED
C 19S7
said his trial w«nt pretty well over in Roae.
It. . . (garble)
I was pleased to hear that.
Ghoilt; X need to contact with him because I have a lot of
trouai» je.tJi_tb»«« eyes. Today the Jacob because Ollie told ae
don't a?t»<f t « Tou know the whole story.
Charlie: Ninrodi?
Ghor: He is killing me. And I was looking. . .
Charlie: Crooked, isn't he?
Ghor: . . .begging them that t^CTBe put me out of this
business. Today he called my hgi«g2( whisper - and
threatening). Said very (garbHf) il^i s learn the lessons
(laugh) (garble) .
Charlie: Nimrodi?
Ghor: Yes. (garble). What thfeS^l is with me is not my
problem. You know he loves money. And you know this man dies
for money.
Charlie: He is a traitor.
Ghor: I have never seen such a man.
Charlie: You know he really is. New York, he has Jn office in
New York; he has an office in London, here. (garb/ip)
Ghor: In one bank I have account.
Charlie: Urn, hum.
\
Ghor: I have only there four hundred thousand JBollars . Ip
that bank, he has fhere, in the same offices with my friend, he
has seventy five million dollars.
Charlie: Gosh. He has seventy-five million?
7
JSJ?7/A
\mmm
1016
uHtyissro
I ?
9SB
Choc ^-BISHI|f?iMae of his daughter, has twenty five.
Ch^C1J.e« Bacd'%o believe.
Chfrlie: Jacob Nimrodi?
Ghirs The account - hm. He is seventy . . .in this bank he is
900«k.l tbink^^ec at least hundred million dollars. Be has a
Hidlana-<Mnk b«re ten million pounds. He has ten million
pounds here. (whisper) (garble)
Charlie: So, he is now being threatening? He knows it's going
wrong - so now hw is being threatening?
Ghor: No, he think that I. I
already. It was not my decis
Never. . .
Charlie: You, you had nothin
Ghor: This is nothing I do.
decision of the, of the other
this when I was out of this
^o put him aside, you know?
to do with it.
, they this is, eh the
le.
Charlie: That's right. That was the decision of the Israelis
and the Anericans.
Ghor: Americans. I had nothing to do with any of it.
Charlie: Tell him go talk to, to others, talk to Ollie and
others.
Ghor;
it. And to tell him this is not my business.
not let me up. He will be fighting with me.
.this coming ten years,
Charlie: Nir is ^ very politically ambitious man, you know?
He has great aspirations to lead Isreal someday as Prime
Yes, but, but they this, eh Nir, was sup^sed^to stop
ise Ve will
\
Minister ,
JifJ?7/A
wsmm
1017
witmvB
C 5999
litb'^Js style of operating.
Ghor; jfWiW ••r (garble) Nho?
Chop '"^l^arbleK ■» is a good aan.
Charlie: Smart. He has made a lot of eneaies.
Ghdtt Yes.
Cha^vt Hi
Ghor:^*, y»« (garble) Okay. Then. .
Charlie: All right.
Ghor: This is, this is the part. Now we are, we are so auch
involved with the^^^^^Hin this way and that way.
Passports. Many passports thevBBpply. I. I. if you like any
kind of passports I can get thpi or give you a copy of those
that you pay for Iranians.
Charlie: You get the passpor
Ghor: Many. . . from]
for us. The, the
; - genuine passports?
Many passports they manage
#11 Arab countries, all Arab
countries, ^^^^^^^pso on and so on so. And Nir was, was. was
has big eyes (garble). Ollie can tell you. He asked for some
question. Somebody wi th^^^^^^^H passpor t. And this was the
What everybody ask I tell them in the background who
is this. He was shocked. (laughter) Because th
there was a VIP they picked up sonewhere b^
which was the passport of. of, of uhj
Charlie: Yeah.
Ghor: And he asked me about twenty names. l/gave him a).l the
names who they are, and where they are and what (garble). He
was really shocked: Heh:
Charlie: And you have some South American ones, too don't
9
JS^7/A
IIM(4JK^oinrn
1018
«USS\fB
C 4C00
you? J^^^^HEi^*" And^^H^
Gho^fl^^sTw^^Ma supply all, all South Aavrican.
Ch^ll*: Some South American?
Ghofj They ace very helpful in, in, in South America. Okay.
What^ irou ceBMD*r when I was with you the last time? I told
you on».«^ Jth» reasons I was in Spain because the Iranian PM
wants those prisoners we have in jail to be released in Spain.
Do you remember this?
Charlie: Yes. But, uh.
Ghor: Three (garble)
Charlie: Three.
Ghoc: Okay. And then I told |pu that the reported to PM that
it is going to help and we canBp it. But the PM was so
ambitious that he ordered the Miktnq the hostage of the
Spaniard.
Charlie: They, they picked up three.
Ghor: Yes. And this happened after we had the discussion.
Charlie: That's right (garble)
Ghor: And now there is official announcement that the Iranians
tlT'y, they these three prisoners they should be re|^a«^
against these three. If you have any interest in JUlflbf^'-can
work out. T can release these Spaniard within hCLC anVu>ar.
If they agree to release them. Cause I 6iscusa^ft'Xbi»-r9ith the
Iranian PM. So anytime they deliver to you.
they like.
rhatl)?: If the.
UNCLASSIFIED
deliver <p what
Ghor: This is directly Iranian PM business now. Uh.
10
js^j/A
1019
UNCLASSIflED
C 4001
re three picked up by Anal Shi 'a.
this is all force.
Ghlrt Because two of these guys, two of these guys is, is from
the^H •tficer "^
Charlf>«a^Twa.4»f the chaps in the (garble)
Ghor : Two of the three. . .
Charlie: So he has a direct interest?
Ghor: Directly.
Charlie: He's got to get. . K •«
Ghor: Cause they were from -rthjs was his direct order of so
what, what it was supposed to'faappen in Spain.
Charlie: Yeah, they were, thKr^«fiere caught in attempt against
a Libyan. W^s,
Ghor: Attempt against Syr. .B^C .Soviet.
Charlie: That's right, a Soviet.
Ghor : To h i jack . . .
Charlie: That's right, Soviet.
Ghor: To hijack the Soviet plane to bomb the Soviet
installation, everything. Against the Sovi€
Charlie: That's right. So, uh, it would s«
as I understand it, uh, the, the Spanish. .
Ghor: That is why I call you. That is why
Charlie: . . .is to let the three go and sc
Lebanon and then, uh, ?x. . .
Ghor: And this I can r^o for them like this (sound of snapping
fingers) in one second. If they tell me they deliver the guys,
^ 11
t. uh.
1020
UNCUSMD
C 4002
the PM to deliver the Spaniards,
deliver (garble)
easy. It is easy to do this because we
PM for the last one month before this
u about this. Before it happened that we
are 901119 to tflscoss about this how to bring thea out.
Charlie: Okay.
Ghor : Now you, you have, a, a. about or ask about the things
generally you know. Now we are ready besides to do whatever we
discussed about these things with you and the messages I gave ;
to. to Ollie for you about theSUting all this Iranian
Speaker. About the.j
the man. . . Row did you fin<^Cb« translation of those five
pages?
Charlie: I haven't gotten the^^^k yet. And I am sorry. I
sent them to the translator and they haven't come back.
Ghor: Why?
Charlie: I don't know. I will, I'm glad you reminded me.
Ghor: This is now ten days maybe. It should take. . .
Charlie: Government bureaucracy is terrible, but.;
Ghor: It should take him, urn, maybe half an hour^HlF^Bsaiislate
this.
Charlie: I, I don't know where those are, I «#Kj I
check on that before I left. I brought, uh, ^'TVdon't have
those. jr \
Ghor: I wanted, I wanted you to because this was for very,
very first thing how you know (garble). How, how our
12
y^J?7/A
lillfll nsKfttrtrts
1021
UNCLASSiflED
C 4003
contractStf'^ai^BCy* very good contacts we. we have through that
channH alBoT '
ChaAiei I asked for it. I have been very busy. I am sorry
Chorea. I apologize.
Ghoni -SO. is uh/^. .
Charir«j Let ae find out. I will find out tomorrow. I will
get back, I'll be at the office tomorrow evening so I will. .
Ghor: Okay. Number one. our suggestion is this that besides
all we have offered to you. You know with whom we are in
contact, how we can manage ^^^^^^^^^^^ what is our relation
wi thfll^^^^^^^^l and what otheflk'tngs you can do. Now you
know generj
1022
^ BNcussra
HNWssra
m
1023
ffiSUWtB
4007
rlie: You mean uh, .? f
Ohor: ^IX^JfOO agree with this operation (name unintelligible)
believe me he was finished by now. Cause we have. . .You know,
you know the new terms he gave to us. we gave to Ollie, he gave
to you?
Char]
Ghor: The new terms he was c^dy to pay ten million dollars
cash and all these things. Y^ r«member I gave Ollie to tell
you the new terms of, of
Charlie: Re didn't tell me tb^««
Ghor: He forgotten it?
Charlie: Yeah. I'll, I'll check with, uh, new terms frori
Ghor: Yes. The general new terms he, he agreed to pay ten
million dollars in cash now. Besides for ten million barrels
of oil two, two below the narket.
Charlie: How, how much in oil?
Ghor: Ten laillion barrels. Two Jollars below
TELEPHONE RINGS
Ghor: Hello. How are you. (laughter) No, y<^ are downs^irs
Okay. Hold on onf second. Michael (whispering)
Charlie: It's okay. Let's don't talk about that
Ghor: No. no. Hello. Come uo, you know, 926.
■ 17
1024
mm\m
C
4008
HANGS
(gai
Ghof Mo this is nothing. (garble) We already discussed.
Chain*: Yeah, you need to write that in detail so that. . .
GhoA f^arbleL^oaorrow I will do this.
Charlfd . . .so that your friends (garble) they will
understand clearly, and give then. . .
Ghor: I know how. . .
Charlie: . • .that have been told by the emissary from
American that the evidence, th^_ij)JFormation is absolutely
compellingly accurate,
Ghor: . . .this in my report. Pikay'
Charlie:
you will have a good chunk of tfif^front in another few days,
if things look up.
Ghor: Okay-
Charlie: I. I. 1 think they will, I think they will say this
is a sample that shows the American good faith, let us continue
to work the problem. And, uh, the Hawk stuff
terrrible, terrible.
Ghor: Tonight I was talking to^^^^^^Bhis home/ I dM*t
know you take it to his home or no. But if he ]^it«n ^tonJ^ht
he will say the Prime Minister now is dying ar
stopping because of (garble). He said it is.,
believe it. Tonight I hope that you are on the air he was
V
cr y I ng ,
JJ^7/A
ONCUSSlflEB
SECBFT
1025
*Mg,
4009
Char liff Sg/ttif^z i gt t?
END ^ FIRST SI0K or TAPE
Ghodp leljeve m^, ^Anight, I hop* you are on the air, he was
cryiife:^
Charlier^Is that right? (garble)
Ghor : Believe ne.
Charlie: Hostages?
Ghor: Yea. hostage to this matter with Khomeni. (Garble)
Charlie: Very serious.
Ghor: This is a crazy action ^Hfjist America. I couldn't ...
Charlie: He is capable... gart
Ghor: I couldn't (garble) ^o'C|^< 1 hope, eh, I don't know
what you are going to tell me (^^[gwas, was very interesting
tonight discussion,
Charlie: Okay
OPENS ODOR IN RESPONSE TO KNOCK
GHOR - Hello
MICHAEL -Hello, how are you. Nice to see you.
GHOR - You look very fresh.
MICHAEL - Yes, you too, you are kind. /■" "tS. ^
CHARLIE - Come in Michael.
MICHAEL - Let's see you guys work. I'll go watch the Super
Bowl.
GHOR - No, no, no. no.
19
IGUSSIFe
82-688 0-88-34
1026
C 4010
HICHAE]g^M|^^9*'l^ ' S on
CHARl^ . »rt TIUMd help.
GROll - What would you like to have?
CRAILXB - We can watch the Super Bowl here.
GHO^^ Would y^ like to have something?
CHARLlB^j- Ite tew sone good fruit here for you. Michael.
GARBLE
MICHAEL - Fruit is fine. 1 just had (garble)
MICHAEL - Nice to see you.
CHARLIE - Nice to see you,
MICHAEL - You are looking fin<
(GARBLE)
CHARLIE - You are looking fineftoo. I am glad things are
going well for you.
MICHAEL - Ahh. 1 am fine.
CHARLIE - (Garble) Sounds like~you more than held your own.
MICHAEL - I almost froze to death in that....
CHARLIE - In, in Rome?
MICHAEL - Oh, the court was so cold, oh my God.
CHARLIE - Uh, they didn't heat it.
MICHAEL - Yeah. No. Well, they turned to, it
they, uh, ran the heat until about 12:30 and th«|L «*e^
started leaving for lunch. And we kept going op^ auid ,oif and on
and then finally around quarter to three theyjpsked me this
question. And I said, "I can't answer this Question." So the
judge saw a ray of light and he said well let's adjourn.
j^^y/jx
1027
C 'CM
MICHAEM^^^^^HWiP"'" ♦ ( Laughter continues.)
GBO|^|llfi(t Js^^^^d?
MTrfelTT - Oh, they'll have another hearing on the 8th of March
and^pnother one ^.JLpril and so forth. It is going to be a
Yeah. It is not so simple. Not so
r
^n a whirl
CHARLIE - Well we need to. from these new general terms. I need
to get with Ollie. (GARBLE) I've. I've seen Ollie one, two,
three times since he, he saw you.
MICHAEL - Yeah.
CHARLIE - But, he, he has beenT
GARBLE
GHOR - And it turns out that w#^agceed that we do the whole
operation for him in the Unite^^tates which is the most
important part. And to, to arfte^v for him the whole operation
in the United States.
CHARLIE - With Ollie?
GHOR - No, no.
CHARLIE - Oh
GHOR - Against United States
CHARLIE - Oh.
GHOR - And he will, he will supply .
CHARLIE - (GARBLE) Another operation in the Uni
GHOR - .
this start for bombing and, and, and uh, assassination in T3.S.
MICHAEL - You said bomb and assassinate in the United States?
Can we go to the State Department first? (LAUGHTER)
21
Stales .
and he will supply another ten mi lAion dollars for
CO
m
(GARE
1028
C 4012
MICBH^ Liste^.I'll give you soae offices on the lixth floor,
(LMOTTER)
GHOR^
CHARLIE/ HICHAEL - Yeah.
GHOR - So, now Charlie, you kmriBhat we can do for you. He
expect from you to hear from jmToirect, director make his
decision what you want to do. BhM you want to do with us.
They are ready now, prepared apy second we are prepared now we
are ready to go. too. You hav^^l the steps, all the proofs,
and we are not saying that yoiflRn. coming next month, next
year we say just five minutes fron now you can just
(unintelligible) the steps you can meet them, you can see them,
you can talk to them. You can walk to them. (LAUGHTER)
MICHAEL -^^^^^^^^^H can come with his machine. He can lash
everyone of them up to his machine. (LAUGHTER)
CHARLIE - So we can meet your people, talk to thi
GSOR - All of this.
CHARLIE - and, and we won'
don't like the polygraph, either.
GHOR - No, no that, that's fine but this is the, is the way.
Now really you must make it serious. What do you want to do
I't (garble) I won't, mJUNSSTCXI I
for us? Is not going to be a one way street.
22
m?\ ^^^
1029
C 4013
CHARIJP^^^^^X3k 90t to be a lon^ t«ra plan. We have to 90
oveg.'War plan. ^^^29^ enter this relationship to work with you,
Mi^«*l here, trying to find a way to bring back the kind of,
bcifjl^into powerrthr kind of government that you want then we
have^o «stabl:Mb ah....
GHOR - T*lM_J« 1* i s whole problem...
CHARLIE basic rules of order.
GBOR - (garble) this is (garble) we will do it.
MICHAEL - Ho, we are doing this. Don't worry about that.
GHOR - This is...
MICHAEL - GARBLE
GHOR - This is going to be vert, ♦*>. this is going to work very
well. But the step is this stlb«ow. i was talking to. to, to
U^H^Hand to the other peopleB0Du know the Khoneni has
decided to step down.
MICHAEL - HMMM
GHOR - On the 11th of February. And to, to resign and to bring
the new leader in charge to settle for a time. You k^w, he
wants everything be fixed when he dies.
CHARLIE - Montezari will ?
GHOR - Montezari. We are holding our own very w^li,' TQk J s a
big fight. There are certain leaders who don ' t^lfti^ t*'*1fco be
done on the 11th of February. Instead to be An^ on the.W>n
the March, 21st of, March, the new year, we are fighting for
this to be done because that is why the day before yesterday
>bV7/A
1030
C 4014
CHAflLIS^ Yeah
GH(9t - ^^^^^^^^^^^^^ He officially stated that the best
chcflce- that Ayatpllah Montezaci coae up. This was all push.
Cau^ «« wanjcJnii to (unintelligible) So but. but old friend
called^^^^^^^^B f rom the hone of Ollie. I talked twice to
his very late in the evening from his room. And he said these
are the most sensitive days in our history. Where are our
friends American? And we need a lot of stuffs. (LAUGH)
MICHAEL - He has it.
GHOR - Nothing yet. Who, who^ave him a penny.
GARBLE
MICHAEL - So money he wants?
GHOR - Yes. He has no money . ^_|l^j»i 11 take the money. The
American they charge. He, we^HPbd out that the, the, four,
five hundred eight (unintelligible) American receive nothing
(Unintelligible) we spend the money for you. What, who got the
money? Who got the "noney?
MICHAEL - Well, we didn't get - the money is on the accounts.
GHOR - No, they said they spent all]
expenditure and there is no money left even
MICHAEL - Who said this, the Israelis?
GHOR - Yes. ^nd they said to American. I
(garble) discussing this. This is the offi<
have now.
MICHAEL - '.Veil, 1 mean tnank God I don't know anything about
that one.
tfrz)7JA
w&mu
1031
i
CRET
Muolt
*»':•'',''*.,
Uij
4015
GARBLE
°bOV the other profit - calling ten tiaes a day
ise and today was very angry and threatening..,
CH9UB - He was getting very coercive.
GHO^-.«.» .because you told ne I shouldn't talk to him. And I
don't>feplk tio kia so he thinks I, I, he thinks I put then out
of the business. And I told you CONVERSATION ENDS.
NO PORTHER CONVERSATION ON THE TAPE
I'^Dl /A
DNCUaSfFlEO
1032
The Dtrecior oTCeniral Inielliincc
Alien £<!33
NIC 00812-86
18 February 1986'
hCMORANDUM FOR THE RECORD
SUBJECT: Interview Mith Subject. 26 January 1986
1. I met with Subject for three hours at the Churchhill Hotel in Portman
Square, London, on the evening of 26 January 1986. We spent about half this
time going over photographs that had been passed to an American official a few
days earlier. Subject also described a number of terrorist plots and
discussed the relationship that he wished to develop with the Agency.
2. Subject began the meeting with a lenqthj^latrlbe against th^gency
officer whom he met recently by the name 2dH^H||i^ ^* statedfl|HAhad
asked him for Subject's file on Ayatollah^H^^^strong Line On^Wponent
In Tehran. He described this request as "out of line* and that^jB^
association with those wishing to change the nature of the governmen^n
Tehran was "a very sensitive matter". He accused the Agency of wishing "to go
directly to the source' with the objective of 'backmaillngl^B^into
working for the United States. He stressed that^H^^ was destined to be a
future leader in Iran whe^ft^hange In governmen^occurs, that he was
working ven^losely "IthflH^ and that he resented the Agency's effort to
contact^H^directly. Sinject also complained about the manner in which
his recen^oTygraph had been conducted by the Agency, asserting that there
had been semantical problems with the polygraph operator who spoke no Farsl.
He said he "felt sorry" for the Aoencv^because of "the poor quality" of those
arkino on the Iranian deste.i
3. Subject claimed that he had worked with other Iranians for the last .
six years at great personal expense and sacrifice, endeavoring with others to
build an organization inside and outside of Iran that is capable of
challenging the Line Two. Subject recounted how much he had suffered since
the Khomeini regime had come to power. He said that he had lost "his best
friends* and that his sister had been tortured.
4. Subject claimed that his organization had such influence he could get
subjects Inserted into the debates in the HaJTes. He also asserted that he
could get a subject discussed at the Friday prayers by President Khamenei. He
Partially Declassified/Released on ^ (>J ftiOflR
under provisions of E 0 12356
by K Jotinson, National Security Coundl
imAssra
TJdtCON
1033
R£T/N0fO«N/NaONTRACT/O«COW
mm
claimed that '«e control the President like a chicken.* He noted that his
organization is not 'a broker of change" but 'an architect". He stated he had
put his personal fortune and the lives of his family at stake In order to seek
such change In Iran.
^^^^^^^_^.^.. again recounted how cneu^^BBi^^l^^hac
^w. „_. wn^wro^nhlmbecause he would not agree to be "a controlled
agert." He also asserted that as an procurement agent for the current Iranian
Government, he could write checks for millions of dollars, and displayed a
checkbook as well as records of deposits of large amounts of money.
6. Subject stated that he and his organization wished to enter Into a
relationship with the Agency in order to draw upon its resources to effect
change in Tehran. He asserted that "we do not wish to be kingmakers" only the
right to be "a small partner" whereby his organization and the United States
could work toward mutually beneficial goals. He claimed that his organization
had over (100 million In assets In Iran. With some emotion, he stated that he
loved his country and that he wished to return with his family. His whole
being was dedicated toward this effort. He compared his organization to "a
company" which had certain assets. His organization was more than willing to
provide information as part of the bargain; this was understood. Subject
described himself as "an unusual Individual" who is straightforward in his
dealings. He said that he would not "trick" anyone, unless he found himself
dealing with deceptive Individuals or organizations.
'rrorT/ijftrnou/unmijTOirT/nori-
1034
*M«/f/ffl
3^4
I
UNCIiSSIHED
1035
J75 milion. Including 10 million L,nH, 7""r°'^< c^i^^s to be wrth
arrange^^^nts with Subject and'^^s tl>,'f::!/:f]"g;j;^o;^ certain business*
1036
22. Subject again raised the question of his relationship with the
Agency. He emphasized the need for an early dec Isloj^n^note^hat "this
Mould not be a one-way street.' Subject noted ^'^<4H|^HHH^|*'^^
gaining In stature but would need some financial suppor^^S^consoll dated
his position. According to Subject, Khomein^iay soon step down In order that
a proper succession can occur In Iran. flH|0 s"'' others are urging that
Khomeini step down on 11 February but tm^iay not occur until 1 March.
Ayatollah Montazerl will be Khomginl's successor.
L3.
1037
20 Hay 85
13 Feb 86
Cll'i 173-".enc to DCI 'roir C/NE/DC Ri: CcKT-.ents on 5horban-;*a-'s
«ecent f^eetings witn NIO/Terrorism
:::'i 174-«eno tc OCI 'rotn C/NE'DC RE: Meetings witr Vic^.ae" -ee;
"anuchehr Ghorbanifar
ICIIN 175-Meno to C/NE,
,RE: Request for Assist^
from C/N£/Iran
iCIIN 177.Memo to
|CIIN 176-Memo toBBVH^''°^ ^'"''^
IRE: Request for ConrnlnTcanons Equipment
0277
fron C/NE RE: Request for Support
CIIN 185-Cable to U.S. Customs Service Intellinence Division/liiaison
RE: Flight Clearance
Partially Declassified/Released on Z6.alfl
under provisions ot E 0 123S6
by K Johnson. National Secuniy Council
.88
/llten tx.*^^
fwcuss/fe
50IM
1038
MEMORANDUM FOR: Director of Central Intelligence
VIA:
FROM:
SUBJECT:
Deputy Director of Central Intelligence
Deputy Director for Operations
Chief , Near Ea st
Di VI s i on
Comments on Ghorbani f ar ' s Recent Meetings with
MO' Terrorism i n97Q
1. The information provided by Vanuchehr Ghorbanifar in
the attached memoranda (Attachment A), like any good
fabrication, contains elements of truth fnares, titles,
respons 1 bi i t ies and poli_ticj_L leanings of Iranian officials,
et^^^^^^^^exarrp 1 e .H|^^^^^BHHi^H^^|Hi^|^^^^^^^^B
Hm^m^H^^BB^ ^ e three Iran i an officials wno suppos^lv
will visit France next week for R6R are fairly well-known
clerics. But, this type of information is readily available
dZXA/
1039
UNCUSSIFIED
3. There are two items in the attached Benoranda, however,
which are clearly untrue:
were included
''in the examination concerning the veracity of these . n07n
statements. The exatrination indicated deception on the ' U2/9
information he provided on this subject. In the follow-up
questioning, Ghorbanifar showed himself to be evasive and often
reluctant to answer the questions and contradicted himself on
relevant points. This was reported in the operator's writeup.
we planned to test him on its veracity and included in the
polygraph a question concerning whether he actually obtained
the SAVAK file on ^H^B. In the pre-test interview, however,
he said that he never had possession of these documents, but
had heard about their. As a result, we deleted this question
fror the testing and no further discussion was held concerning
the file.
1040
UNCLl^SIFIED
the chips were down.
6. It is also worth pointing out that each of
Ghorbanif ar ' s schemes involve substantial sums of money which
he would receive in exchange for his services. In his proposal
to "sting" the Libyan Government, he expected to obj
$l^n^^^^n and his latest proposal concerning,
HUHHj^^ $S0 million. Over and over again in his file the
monetary angle is present in all of his proposals.
7. As far as the Israelis are concerned, it is interesting
to note that in the memorandum of 18 February 1984, Ghorbanifar
stated he is having difficulty with former Israeli official
Jacob NJTii-odi . It was through this official that Michael
LejLppn was originally introduced to Ghorbanifar. This falling
out night be due to the financial arrangements made in the
negotiations. . — - -
r
8. The major problem with Ghorbanif ar' s information is
sorting out fact from fiction and we will never be certain
which is which. While Ghorbanifar has contact with Iranian*
officials, there are real questions about his motivation and
control. It is not at all clear which side he is working for.
In fact, hjj; polygraph indicated that he is under Iranian
Government control. Unfortunately , the U. S^! Government has
"enhanced this fabricator's credibility with the Iranians by
using him as an intermediary in the negotiations for the
hostages .
^^~G5o 1040
UNWinED
1041
WWSSIflEO
9. We have traced several of the individuals Bentioned in
Ghorbani f ar' s memorandutr and the results are contained in
Attachment B.
ATTACHMENTS:
As stated above
c/A^tr
0231
UNCLASSIFIED
1042
AHefl Ex*??
mmm
C 1466
1043
1467
I. APPRECIATE REF. AONAN KHASHOCCT
IRANIAN CONTACT REF IS MANUCHEHR GORBANII
GORBANIFAR IS THE SUBJECT OF A FABR I CATOKjKOTI CE
023056) ISSUED IN JULY ISau. BASED ON RESULTS OF TWOl
WHICH INDICATED HE WAS PRACTICING OECEPTIO* ON ALL REIEvI
QUESTIONS AND DELIBERATELY PROVIDING FALSE-iNFORMATI ON.
GORBANIFAR OPERATES AN inPORT-EXPORT BUSIJIESS IN PARIS AND
REPORTEDLY IS INVOLVED IN ARMS PROCURUEITF- FOR ini.
"XL B
END OF MESSAGE
SECRET-
Lklji^rUS^
Patnally Omiassified/Released on
under ofovisions of E 0 12356
by K Johnson. National Security Council
:5oiu
CUH lOSLf,
^^'^-'^^
/Vj-c,
4rcs
1044
C 1468
pip
LONDON. WORKING OUT SPECI
FICS (
rflTH ICA9IMK
2. FILE: DEFER.
DECL
OADR ORV^^I^BaLL
END OF HESSAGE
SECMT-
;^v - .- ■-'- .,,*.v ^;,f:
■" '''"5' ^----N
Partially Oeclassified/ReleaMd on Zb-i-ft/v- ^ — V ^^^
under provisions, ot EO 12356
by K Johnson. National Security Council — A
•U •
08 .0 /^^
«to^,
1045
CHARLES ALLEN, NIO/T
UNCLASSIRED
Ajc a^t--.
c u
KHASHOG^I^^IN IRANIAN CONTAC T. IN THIS MATTFR ^'^__^^^^^;^2!I^
GORBANIFAF
GORBANIFAR IS NOW IN LONDON
WORKING OUT SPECIFICS KEBHH WITH KHASHOGGI,
0 3 0 l/j<3
:(50i'
C///V /^A?
""^miB
uT^.'n'^^
Mfc^xrc
1046
TOP SECRET
mmmn
N
9213
February 7, 1986
^__^^^^^^^^^ came to town to give me the attached this morning.
The marginal notes and parentheses are mine based on questioning
of Mike.
Observations;
1. Mike says he doesn't trust us and he would like a clearer
picture of who is managing this. I told him he didn't need to
know who, he had a point of contact; and I repeated the litany
that no one trusts the group he represents either, but we are
willing to explore.
6. In short, this is still as flakya^ever.
^1 am still very dubious.
under DrovJs,ons of E 0 1^6^
TOP SECRET
Declassify: OADR
P/
b ^ ..
^°*>
1047
UNCUSSIFIED
X)cCUK€(Crrs
UNCUSSIRED
1048
BNCUXSIFIEO
1049
C\ 0151- I 0152,^ %.
7>eMiec> IN ITS
^TieerV
1 i
1050
m0\^^
mw""" ^^ t 216
Partially Declassified/Released on Z^^ftN. 88
under provisions ol E 0 12356
by K Johnson, National Security Council
A*rjr*>
1051
>r««r<r.n wi»->. R nn 2T Pphriixrv. JfllQ hnrir«
C 217
»noin or vnii , "r. unon* w;inr»n rrt Knnw y/i"
•i»rm mmkinn nnmm jtr runvmanf • w<»h Mr.lTrr
d» is verv an«ioii«'"T^°'wh»n h» shnuld com*.
*. l'v» h»»n trvino to aet Ahnid of von. Mr. RooH* w^nt-^H t-n know ^•''
h» nhniild com* l-o k»» voii. yon war* makinn xom* Jtrri
■^*^ with Mr. Good*. So Mr. Good*
G. OK. I t-*1k»d tnAxv wi»-h fh* a«rii-1*man von in*nl-ion»rt anH t.h» PM ' «
office. All is set for a m*etina at 2:30 om on Tn*sdAV.
A. Th<»n Mr. Good* will 1«av* tomorrow *v*n«na. H* will m**t von ;»r r h*
■ase olace for in*etina at 2:30 om In the afternoon. Is that correct?
C. OK. This i« v*rv advinxhl* thflt h* h«v* mor* Whit* h«ir on hi« h*«d.
White color to his head, white hair for them results in nor* resoect.
A. This can b* arr»no*d.
G. This is v*rv valnabl*. Tell hi" (Mr. Goor)*) this is a r*sl
breakthrouah. Thev have made ud their minds, and we have brainwashed the.<ie
oeoole and hav* instiaat*d th*m aoainst rh* north*rn n*iahbor so th*v ar*
readv to nake a real firn resoonse and collective coooeration for the future.
Thev should also be readv to b* * large* and to olav th*ir cam* lust to mak*
then showoff. I think this time with all the strlnas I have oulled now it is
aoina to work out. 1 was not told how thev arriv*. what th*ir oriainal
arrival, their arrival was suooosed to be bv a orivate iet which belonas to
P.M. I think thev were verv much concerned about th* secrerv of mission and
lot to call attention to this arrival. Not to brina anv attention to the
jountrv in which the meetina Is to be held.
A. So. thev will come normally.
G. I believe thev will arrive the same dav at 1030 in the mornina. It is
al*o verv advisable if vou can soot them on arrival when thev are all toaether
and take the necessarv ohotoaraohs. Then vou and I can discuss about these
photoaraohs later because there could be some other oeoole with them who stav
inside and don't show uo in the meetina. Bv this wuf. vou mav have some mor*
collective information who is in charae of makina such imoortant decisions.
A. I think that sounds aood and w* certainlv will take that into account.
G. So count on Tuesdav mornina arrival bv the national carrier which
normally arrives at 1030. I'm aoina to have lunch with the head of the
dcleaation, but I believe there should be some other heads of the deleaation
for confirmina and makina the n*ressarv onlicv makina.
A. Then Mr. Goode and anv other oeoole who would be comina with him will
certainlv have to leave tomorrow nioht in order to be readv to do business at
2:30Da on Tuesdav. To Mr. Goode. this is a critical meetina and we hooe all
will be resolved.
G. That is a real breakthrouah for all of us. We hooe it works but there
is aoaethina which could not onlv uoset these arranaements but could also be
rcallv brinaina the end of the life of those oeoole which we are workina on.
Tkat bcoaabt to ac a verv critical and deliberate mistake the name of an
Partially Declassified/Released on ZbJftW 88
under provisions of E 0 12356
by K Johnson . National Security Council
.5059.
DECL OADR
1052
C 2T8
individual «• m tmwt»t of vnor d«l«aat.inn which hit* auch a bad naa« in av
olaea. Ba's a c«*l Jcwiab aanaatar. Ha baa one of th« baavicat filaa in that
eraanisation whicb ia followina uo tha oaoole. Tbia ia a verv dana«roua
■iatakat I don't know who aade it on vour aide to aiva uo auch a Jawiah name
at auch a critical tiae for auch an iaoortant Metina. If I didn't know about
tbia. then it could be the end of evervtbina.
A. You're talkina about-, the man vnii're n^etina with one on on»^ at th»
Sheraton.
G. No. the nane of the name he aave to me was suooosed to attend as a
■ember of vour deleoation. His name started with 'Albert' — a Jewish
man — which I told him if it came uo it could be the end of evervthina.
A. So I should tell them?
G. No. This thev know and thev drnooed it. Be is a taraet for them. He
was auoDoaedlv the cover aqent for the cover comoanv to make
I will diacuss this with vou when I 8»» vou. Just remind me to discuss it.
Those two uniformed men who were recently lost in a third countrv are now
definitely in the hands of the IRGC.
A. You brina nothina but aood n^ws overall and I reallv do look forward
to aeeina vou aaain because we have a lot to talk about.
dpadss^if'
1053
,>^ ONCUSSIFIED '•'-"
CAv: r>ui=:».c- hi: association i-i-^h th; •.::
S":" ■■'■■ -' '.:: ':-'::■: -w i-"'. '^i'.':''.-'. : • ::' :.:
^^' :'=A-, It, :=,-:;--£= --hcf'Cina'"':- c:"i a:
.3r»"W<v'.).& _ " - J — .''>.-i_.^'.!J-_i4.^_*_: '
at: i:sc^:rTc= - Tc/FRor
undated -jtlIN0251 - Cave Document, relating information obtained from Ghorbanif
A'b B.*^
Martially Declassified/Released on •Z-fa4>yVlO 8S
undef provisions o( E 0 12356
^•^ K Johnson, National Security Council
uNtussra
1054
r
s y —
%
%
I. i0MAS VCrr RCLAICI «N> SAII THAT CVCRyTHIIIC V«S «RK«NCC». Nt I«it
MC M6MT 60_T» TCHRAII MnOIATCLY AfTCK OUR MJCUJJIOKJ TO Y PI*C£ JuRC
tVtRrTHmC JTAVJ ON TRACr.
e .HOANTOA TO CNM DHO NOUL> tC COIMC TO TCMRAN. TOlO NIR n«Cr*RLAN»,
.Mil COO>,ANI O'RCIt. KUS A COnnO XPCCIALIST. MC THOUGHT THAT HOULI BC
'IN?'
1. DC Toil Hin THAT «C >Z> NOT MANT TO 60 INTO KTAILJ AS THIJ «AS coOt
SMOV ANI NC HOULI CXPLAXN CVCRVTHINC THII ArCRTNOON. «C III I»Y THAT
cool HAI IRAHN W A tCHCfCULC THAT NC « HOPCI NOULI NC ACCCPTABLt TO
THC OTHCR SIIC. HC CnPHASIZCI TO Hlfl THAT Xlf THIJ THIHC IJ TO NORK
MC IIUJT PLAY A rCY NHICN VC NIU tXPLAlN TO Min IN 6RCAT ICTAIL THIS
AFTCRNOON. NC SCCHCI PLCASCI KITH ALL THIS. NC HAS COINC TO CALL
TCHRAN innCIIATLY APTCR HC LtPT TO tXPLAIN THAT NC HCRC LINING UP ALL THi
lucrx.
•I. MC SPCNT SOBC TIHC TCLLIN6 US THAT HC HUST flCNTION NOTHZNC AVOUT
ISRACL IN OUR IICCTIHCS AS TMIS~COULI «UCCR TNIN6J. MC SAII BAYBt HC
COULI nCNTION ON LCAVINS THAT TMCY COULI RCLY ON ^ ol THIS CASC {HONt
HON nuCH THIS IS COINS TO COST THC ISRACLIS>.
$. Nt ALSO SAII THAT HHILC IN TCRRAN HC MAI TALrCI TO THC CONSCRVATIVt
LCAICRS LINC NO. S.
fACCORIINC TO OUR
RCCORIS>. Tttr SAII THAT NC NAI ARCUCI HITH THCH THAT THIS HAS i 6RCAT
TMCY ARC COINC TO CCT INTO POHCR AfTCR KHOniCNI COCS, SO
iLJC nAKTNC'OPCNIHC TO TMC AflCRtCANS. "
tSO tRicrCl'cCRTAIN MILITARY LCAICRS ON THIS PROJCCT TO 6CT TMtl
SUPPROT. WKCSS TO JAY TMCY HCRC CNTMUSIASTIC. '
7 .'ASrCl^^ir rOLLOHINC* CIviCN A SUCCCSSrULL nCCTIHC, HHO HILL HANILC THE
^OLLOH W*ONTMf'rtAHfAN$lic#*tHiS CAUCHT Mlh"iv'"SUPRISC AMI HC SAII THT
HC tHOUCHT IT HOULl MAVCTO INVOLVC iOTH RAfSCHJAHI FROn LINC THRCC ANI>
SOnt PCOPLC rROHLINC 0«C."mC SAti CtvCH THIS" NC THOUCHT IT CSSENTIAL
THAf THC CROUP ALSO I1CCT HITH PCOPLC fROn LINC ONC HHICH HC COULI ARRANCC.
AS AN ASIICHCtAIITHAT «U$AVI IS %U PROBLCh IHTHAT MC RCALLY ICCSN'T L
LIK^ YOU i\sr%.
OPPORTUNITY.
."■ffi!,
f^EVitWEO FOR RELEASE
Ctxk/ "^^SiS/
1055
\
\^. KE T«L» Hin THAT Mt'\lkMtl T
WhC >tKtCT PH»ht'tAU.S TO ^H^
1^
tTKAICMTCN OUT THE >ZrPXCULTlY OVCK
LLS TO M^^B TOL> Hin THAT THE CALL MAS
'AN> HOT US AH» ZH OUR REPLY HE TOL>
ZHSTZ6ATE» BY
fC ti»KSZ>CR THt »tAL~TO BE AS CHUNCZATE»
H
PRO^Ltn SOLVE* AS XT HAS HE MHO TOL»
i_
THAT
Ahfn
H FRAHKFURT. MJftSAIS THAT
TO CALL US ZN»PEN»ENTLY TO
CHECK OM'HZn'AN»'HZl HOHESTY VZA AHOTHtR CHAHHEL. THUS EN»E» THIS
tONVCRSATXOH. ':• * - \ .. - 7 _:_.'.•..-. J ._ '.T ••
10 UcRC -HAS SOnEtftZNC' ZM HZS COHVERATZOH HHZCH LC» US TO 6ELZEVE HE
I
ZN»iCATCl TMb TRZPS TO TEHRAN. - • . -- • r - ' -•
il.-ME HA» TO'XZSTtH TO AT LEAST A HALF AN HOUR OF TALK On'hOM Ca'rCFULL
HE nirST BE ZH KALZH6 ilZTH THESE'CUYS AH» HOW HE NtC>C» SUCH A PERSON AS
HZh'TO CUZIC' THE HAY" HE KNEH HOH TO HANKc'THEH.
12. HE ALSO PROPOS'eV THAT'HE USE* PROFZTS FROH THESE »EaIs Z'l AN» OTHERS
NZCARAU6RA.
HE COULV »0 THE SAHE HXTH
... I.
<^/J f^,^A^(.,^ 0^Jt<f^A^
1056
1
MEMORANDUM FOR TVE R£XX)RD
SUBJECT: Conversation with Subject
NIC 01716-86
2 April 1986
I 0;66
1. Subject aall«d on 31 March 1986 to infora ■« that ha would be arriving
on Thursday, 3 April on the Oonoordc fron London. Vm stated that he was
prepared to discuss the "principal matter", Whic* he reasserted "was
essentially btivind us." He was hopeful that we oould soon begin to develop a
relationship in other areas.
2. I told Subject that I would pick him up at the airport and transport
him to his hotel.
Charles E. Allen
"n«er provisions „, f 0 ,i^^^^^^^
"y ^ Johnson Naiionai «•
™3"onal Secunty Counc.l
P'Odi.
0m*'/9^/AiL
III
CL
LSCL QA£]
'/ORCON
1057
ommi^
Q/^p/i p«
y
mc 017IS-B6
2 April 1966
MEMDRANDUM FOR THE RECORD
SUBJECT: Qonversaticxi with Subject
0167
1. On Sunday, 30 March 1986, Subject endeavored to contact ne but I was
away froa bane when the call cane. Later In the afternoon, Mam called to
state that he wished to relay to ne a message from Subject. Adaa stated that
Subject would arrive here Thursday afternoon, that he would remain here during
the day Friday, but would leave again for Europe either Friday evening or
Saturday norning.
2. Mam stated that Subject wanted reassurance that the US side Msuld not
attest to bypass hin in dealing with his fellow countzynen. He stated that '
Subject would seeV specific assurances during this visit.
3. Adam then stated that he felt it was unwise to try to eliminate
subject from the^negotiations because of the hold that Subject has over the
i^lMfH^pp TheT^BBSHMf according to Man, reports all such direct
contacts to Subject. Mam stated that he recognized Subject was not always
truthful but that, with patience, the principal matter cxsuld be resolved by
keeping Sjijject involved as originally envisioned. War sta'ed that he
i 1 1 L CI K-UvJ Lu Cill Mr. CkXjli; nifl woulil be cxijl-lijiiiKJ Lo liim liio vit-w. on t'.-
matter. In response to Adan's comments, I stated that m^* respjonsibility was
to collect the facts, not to get involved in detailed strategy planning.
Qiarles E. Allen
unoer srous/ons o( E 0 liifi^^
" '"""^""Nanonal Security Council
'O^J
'ilMl^'JnlA 13
82-688 0-88-35
1058
r/NOFOPN/NOaCNTRACT/ORaDN
Ditseaination
'1)0 Not ilcfli"
1/
NIC 01714-e6
2 April 1986
MEMORANDUM FOR THE REOORD
SUBJECT: Oonversatian with Subject
0165
1. At the urgent request of Mr. Goode on 28 Marai 1986. I called Subject
in London. Mr. Gcxide had explained that he had learned fron Adaa that Subject
was enotionally if>set and >ttd told Adaa that he had learned he was being
shoved aside fron participation in the "principal matter". Mr. Goode
requested that I explain to Subject that this was not our intention at all and
to invite Subject to Washington as soon as possible, hopefully on Monday, 31
March. I called Subject in London Wno answered the telephone iBDediately,
even though it was after 0|§0 there. Subject stated that he was indeed upset.
explaining that the MBHHto ^<^ called him and told hin about a teleptune
call fron Hakea in vA^ich the latter clainwd to be speaking for the President.
Haken had infonted the fltfflBBlh that there was no requirement for Subject to
be involved. _S
^./Subject stated that this was the second time this had happened, that
^'^ ^BtSflSP^^^^y^ reports to him in detail on such approaches, and that
the effort by HaVem undermines his credibility. He stated that the principal
ratter is essentially behind us and once this is indeed resolved, there is no
liff.it to the topics that might be discussed.
3. Subject stated that he could not come to Washington on Mcsnday, but
Msuld endeavor to arrive on Thursday in order to explain to Mr. Goode his
views and to seek assurances that our side did not again attenpt to cut him
out of the negotiations.
4. I asked Subject to stay in close touch with mm and to call oe on a
daily basis if possible.
under oroviaons 01 E 0 IjSfi
»VK Johnson. Na.o„a,s.c„;^^,
Oiarles E. Allen
^0^^
I/D'^WJ^
II
CL
DECL
/^^/
1059
SBCRCr/NOPOfW/NOCDNTRftCr/ORCON
Luslvc DiBsesunat ion
3 I />o^ ^ ^^
y
NIC 01676-86
31 March 1986
MEJ10RANIXJM FOR THE RECX)RD
SUBJECT: Oonversation with Sobject
I 0164
1. Subject called me late in the afternoon of 28 March 1986 in response
to a call that I had made earlier. I told Subject that it was ioportant for
him to know that we intended to continue to do business nth hix and that we
would provide him with appropriate support in sane of his endeavors. From
conversations that he had earlier with we and a consultant to the NSC. I had
discerned that he believed that there was no interest in a long-term
relationship. I assured him this was not the case and that sooaone would be -
seeting with him after he made his trip down south (i.e. Bahrain). Subject
seemed reassured by these oonnents.
2. Subject stated that he had "excellent news" for Mr. Goode and that I
should have Mr. Goode call him as soon as possible. 1 told Subject that Mr.
Goode was extremely busy and that I was not certain he was even in the city.
but that I would endeavor to make contact.
3. Subject, stated that he would be leaving shortly for the continent and
wDjld be spending the next thjree to four days in his honvs in tlice.
Ovaries E. Allen
'■'^~s^
(@)
C)J/1) */^^ /a /o
1060
SBCS^CT/NDPORN/NOCaUTRACr/OKXU ^ ^ /*^i^^y \r(^
ULlon
NIC 01654-66
28 Mar* 1986
MD-ORANDUM FOR THE REOSRD
SUBJECT: Relationship with Subject
I 0165
1. A consultant to the tSC called me on the afternoon of 27 tterch 1986 to
state that he had just talked with Subject kAio is currently in Londan. In
this conversation. Subject requested that all of the original documents and
photographs he had provided Oj^gen^^^returrje^wnediately. ite requested
that documents pertaining toH^^HH|^^H|^|^^^|in particular, be
returned. ^^^^^^^^^^^^^^^^M
2. According to the IGC consultant, Subject was extremely unhappy with
what he believed to be deceptive actions by the Agency. Subject dained that
the apartjnent of his girlfriend in California had been entered and her
personal effects rifled through. In addition, a business associate in New
York, Femmark (phonetic) had his office entered as well. Subject stated that
he suspects that the Agency was involved in these activities and, as a result,
has decided not to *ork with the Agency on issues relating to terrorism.
3. The NSC consultant stated that fror. Subject's perspective, the Agency-
has been totally u.-iresponsive in assisting hir. in his e:v3eavors. Sot^ect is
already under pressure in "work in the principal matter" and now feels
;holoq i ca 1 1 V _dainaged by the Agency's unresponsiveness. Subject cited the
as another exao^le of perfidy.
4. The NSC consultant stated that Subject also
received no assistance with I
lained that he
5. The NSC consultant stated that he wanted to convey Subject's consnents
to ne as quidcly as possible because he believed that Subject intends to sever
all relationships with the Agency.
lender provisions of £ o I^iT^^'^®^
^V'<^o.nson.Na„„„, 3,4356^^^
diaries E. Allen
^OSii
Cm*^9.<^M Of
CT/ORCCN
1061
SECREr/NOFOKW/NOOQKTRACT/OROQN
"^^^POf^r^^C
NCUSSIFIED
NIC 01649-86
28 Marc^ 1986
0161
MEMORMIDUM FOR "mE REXDRD
SUBJECT: Cbnversation with Subject
1. Subject called ■« en the norning of 27 Iterch 1986 to infora wm that he
had decided to travel to Bahrain. He stated that he mst go to tehraln in
order to sort out the serious financial problems that had occurred as a result
of a sale of Yamaha boats to a Bahraini in^iort /export executive by the name of
al-Murbati. Before he could und ertak^^i^^iD^ha>gver , he required that I
return to his certain documents H^^|^H^^|||^^^^ In addition, he
requested that I the originals of tv*j F&rs^aoSSent^as well as the >
photographs that he had given me. He requested that I provide these documents
as soon as possible to an NSC consultant so that they oould be sent by express
nail. He also asked that the NSC consultant call hia in London where he was
currently staying ( telephone j
2. Subject stated that his financial situation was currently precarious
because of the al-Mjrbati affair and that his own credit too has been shut
dc*.Ti in Gerie-.^ where he does his banking. He ccrplained rather plair.tively
that he had covered the bad debt lHi^|H^H^^|^^H|HHHHHIBI^fe
but ncx finds himself without a cash flowTT^state^thatit was it=>srative
that he solve the Bahrain affair inmediately in order to keep himself afloat
financially. He indicated that he had talked to certain inportant officials
in a neighboring country who had agreed to assist hia in (leveraging)
al-Murbati.
3. On t}te "principal matter". Subject stated that an important meeting
would occur tonorrcw at 1600 hours in Tehran. The principal issue would be
discussed at this meeting and that Khomeini himself vould be consulted. He
expected acne "very positive" developments as a result of this meeting and
stated that he would know by tonorrow evening the results. He requested that
I call him in order to obtain the results of that meeting. If the meeting
concludes with a positive outcome, he expected that Mr. Goode and he would
have to travel to Tehran fairly quickly. f ^f\Ok^
4. Subject discussed terrorist activities briefly, stating that the '^
Iraqis were behind the recent boriing along the Chajnps Elysee in Paris. He
also stated that the bo«nbing that occurred early today in Athens vas
unquestiorvably the work of Lib^-a and Syria, perhaps using Abu Nidal. He also
stated that he
(?/;/^*yf^A
UNMSSinEK
CL BY
DEXX
jS^X^i
Ias5ilied/Relej5«<) on_
revisions ol E 0 1235«
GHnson. Nalional Secuiity Council
^8
1062
would lilce to resurrect the prc^osed scam against Qadhafi. He believes that
the operation j^ feasible and could be conducted fairly shortly. Unless this
operation was concluded, v*iich would bring humiliation to Oadhafi, he expected
the Libyan leader to engage in a campaign of terrorism against the US.
5. Mam called later in the morning ty inform me that^m^ras indeed in
London. He also reported mucH of what g/j^had told me. .Idam again
acknowledged that he and his associates were assisting .
effort to get him over the current financial crisis. ^-^ircx. L
►financially in an
0162
#yjs^
\»&E
nwmm
/
NIC 01572-86
24 Mur<^ 1966
MEMORANDUM FC» TOE RBOORD
SUBJECT: Qonversation with Man
0160
1. I oallad Mas on the loming of 24 Mar^ to detemine the location of
Subject. Man inforaed ne that he had talked with Subject the previous
evening and that he waa in Paris. According to Adam, Subject intends to
travel to London late this aftemocn and to spend the night there, ft can be
located either at the Churchhill Hotel or at another telephone number
previously made available to us by Mam.
2. Mam stated that Subject oontinues to show evidence of being under '
pressure to produce but thought that this pressure mbs ^f>rppriate. provided^
that the US side was sensitive to some of Subject's needs, ^i^o^hese is '
■ current financial status. In an effort to bail oui^^^^^^^f
_ Subject allegedly has had to utilize funds from his wife's account.
Adam again reiterated that he and others associated with him on this endeavor
were attespting to support Subject financially. Adam also reiterated his view
that Subject should also be supported in his other endeavors (i.e. terrorism)
inasmuch as Subject's credibility apparently is at stake with socie of his
associates.
Charles E. Allen
Partially Declassified/Released on 2.(oJl»iOf
under provisions of E 0 12356
by K Johnson, National Security Council
5C^.
cm^'J9^lAor
1064
Exclusive Dissemination
UNCussra
2_ / A)^/( ec
NIC 01512-86
21 Mardi 1986
MH10RANDUM FOR THE RECORD
SUBJECT: Conversation with Subject
I 015;
1. Subject called on 20 March 1986 from Nice to inform Be that he had
just returned from a meeting with Adam. He had briefed Mam en his trip to
Tehran where he had met with some senior Iranian Govemnent officials en "the
principal matter." He stated that he had talked to the Prime Minister,
Speaker of the National Assembly Rafsanjani, and Ahmad Nnneini (son of the ;.
Grand Ayatollah) . These discussions had been very stressful but scoe useful
develogcients had occurred. A report was being sent ty express mail to Mr.
Goode in Washington. Enclosed in this report were sane technical requirements
from the Iranian military. He was hopeful that a meeting of the principals
could be conducted in the near future. ,
stated that he had a very interesting discussion with the
activities
3. According to Subject some significant changes should be occurring
within the Iranian Goveminent in the next ten days. Ihese changes are very
interesting and have been carefully pre-planned. In Subject's view, this
would create a somewhat different environment for the initiative of Mr. Goode
but the problem was workable. He noted that Ayatollah ntooieini himself
remained very ill.
4. Subject stated that he had provided several photographs to Adam
including one of the next Prime Minister. He also requested that I return to
him the originals of all naterial he had provided me at meetings in JanuAry.
He asked that they be sent to him via an associate kto would be coBiing to
Europe around 10 April. I assured him that I would provide him with the
originals.
Partially Declassified/Released nn IJaOl^rODO
under provisions ot E 0 12356
by K JoDnson. National Security Council
MW\^^
1065
IfitASifllfr
5. Adajn, in a conversation with me later on 20 March, confirmed that he
haJ met with Subject and that the proposals nade by Subject were "somewhat"
proQising. Hoivever, the sequence of events that were to occur during the next
meeting with the principals was not acceptable. This oould be worked
successfully, hov^ever. Adajn stated that Subject needed the help and support
of all parties at this critical tine, pointing out that Subject renains the
central thread in this entire initiative. He noted that Subject in this
latest meeting lacked his usual optimism and zeal. He said he fourd Subject
almost totally exhaused. Adam also claimed that Subject urgently needs
fincincial assistance because of arrangements that he has made to cover the
indebtedness of others. He asserted that he was making arrangements to assist
Subject at least temporarily.
6. Ada.-n stated that Subject had clearly lost some credibility with 'y.^"
associates because of his inability to deliver on the issue of terrorism. He
asserted that Subject needs assistance in working on terrorism matters and was
at a loss why more support was not forthcoming on the part of the United
States. He thought there was "a tendency" on the part of the US to state that
Subject could not deliver. JVe then ensured that this was a "self-fulling"
prophecy by not providing him with assistance. He urged that the US
Government be more responsive in support of Subject, again noting that he
remains the best hope for a successful US initiative.
■ f
7. Concient: I tend to agree with Adam that we should work with Subje<rt
concurrently both on "the main problem" as well as en £tssisting him in
terrorism, regardless of whether we find his inforaation at this stage
credible. He remains the single link to significant Iranian leaders who may
be able to acconplish a major Atoinistration objective.
Charles E. Allen
m
1066
J^^SRfT/NOPOIW/NOaaNniACT/OHOQN
DieiMi nation
piye PieiMi nation
NIC 01442-66
le March 1966 /
hJEMORANDUM FOR TOE RBOORD | 015 7
SUBJECT: Conversation with Subject
1. Subject called fron f^xin late in the afternoon on 17 Marc^, stating
that he had just returned frcn Tehran. He said that he had siet with key
people in Iran, that he had had a difficult tine, but that he believed he had
achieved gaat of the objectives of the trip. He stated that he was calling
froD^^^^^BB^in Paris and was endeavoring to get in contact with Man
but had been unsuccessful.
2. Subject requested that I contact Mr. Goode and Mr. Mam and to convey
his request for an "emergency neeting" in order to discuss further the t
"principal aatter". He clained to have nade certain unspecified arrangeoients
for this Beeting and iaplied that he had nade arrangenents for other Iranians
to attend the neeting. He stated that he had other "good news" to tell Mr.
Goode — again unspecified.
3. Subject stated that he would like to neet with ne and ny assistant San
to talk about "the other subject" (i.e. terror isn) as soon as it was feasible.
Qiarles E. Allen
Partially Declassified/Released on_2(o^^^>i%fe
under provisions of E 0 12356
by K Johison, National Sacurity Council
5023^
„ , ,, mmm
Clia^'/fl I A or
1067
D# NirUffi^
1 1 Ao/^nS^c
National Inlellifcnce Council
NIC 01306-86
12 Mara\ 1966
MEMORANDLM FOR THE REODRD
SUBJECT: Conversation with Subject
0156
1. Subject called afternoon of 11 Pehnnpj' fron Monte Ckrlo to infom aw
that he new plans to travel to Iran "by private jet" early on Ihuraday
■orhing. He stated that he would reraain there three days, returning on Sunday
Doming.
2. Subject, who had earlier in the week requested that I return certain
aateri&ls relating to Iranian terrorist activity to him inmediately, stated .
that I should not atteopt to have the aaterials sent to his until he returned '
frcB Tehran. He stated that he would call me Sunday morning to advise where
the materials should be sent.
3. Subject seemed soraewhat unsteady and acknowledged that he was ill. He
also noted that he was traveling to Iran at some personal risk but claimed to
have good friends there who would protect him.
'O^-^
Partially Declassified/Released on 2^iW>oB?i
under provisions of E,0 12356
by K Johnson. National Security Council
0//a'^^9i>M Of
X C^^^^*
1068
po hJ0T l^fi^
Naiiunul Iniclliccnoc Council
NIC 01270-86
U Marc^ 1986
MEMORANDLM FOR THE RECORD
SUBJECT: Oonversation With Subject
I 0155
1. Subject called ne on 9 Marc^ to request that I return iamediately acne
of the original mteriala that he had passed to ■• in ny Meetings with hixD in
January 1986. Although he engaged in considerable double talk, he tried to
portray himself as an individual nAio had asked for assistance in countering
terrorism but had received no assistance. He stated that he recognized that
probably would be forthcoming on the^^H^HH^H^B^
but that he and his associates had ^^in^l^^t^rSol v
that issue now.
sject stated that I should
naterials %dth other papers being sent to hia by oourier by Mr.
assured hia that I would ccnply innediately with his request.
Goode.
2. Subject stated that discussions on the "principal matter" that had
occurred on Saturday in Paris had gone well, although there was additional
work to be done. For this reason, he wouldb^departing for Tehran in the
near future. Ke stated that his associate^^^Blprobably would also be going
to Tehran as well. ^^^^*
3. I told him that I understood his impatience but that the "principal
natter" nust be resolved, prior to further interaction with hin en natters of
terrorism. However, if the "principal natter" was satisfactorily resolved, we
would proceed ijisnediately to work tdth hin on other issues.
4. OCTinent; Subject seemed unusually subdued and less sanguine than in
previous ccnversations that I Have had with hin.
Partially Declassified/Released nn ZfaA^vofiQ
under provisions ol E 0 12356
by K Johnson, Nalional Security Council
niJ/i}'^'/^!^^^
iniUsm
tefctMs
1069
itussw
^J^(^P<Q
June 1986 /4 fe F")^ ^ VX
MEMORANDJ
olral Polndexter on 5 June
The ^HBvlng subject* were discussed at Che aeetlng:
.•■<?'ft«?Si<
^ ^469
Pamally Declassified/Released on 24 J a^^I Po
under prousions of E 0 12356 '^
by K JoHnson, National Secur.ly Counci
5^36
DCI also oeacriDca etforcs to|
IS well •• a^dl^suggesced effort to
ransoa Che boscages froa Hlcballah. He Indicated Chac chls sight cost as
auch as tlOH Chat could be raised privately. Polndexter agreed to Calk
Co Che Presldenc Co see if Chls kind of an approach could be pursued
privacely given the Adainistratlon' s policy on ransom. (S/Kf)
suggested that prepara
out, however, against the possibility ChaC we would have
Incelllgence breakchrough or special access Chat would
knowledge of the location of the hostages — in which ca
probably have only 24 or 48 hours to act. In this com
wondered whether we could get a full-Cime DI analyse t^ hatp ChailitL
Allen. (S/NT) f^
'- • bv±<\
tU^J l*^33> U
'mssm
ffJfJiT
OECL_^
1070
y
it
wt4ssife
-^^^
^ U70
PJWB
14. There was considerable discussion of a deal on cbe contras that
would Involve ilOOH being allocated i20M a quarter for a period of IS
months. There would be a second vote by the Congress, 6 to 9 Months Into
the program on whether It should continue. The focal point for such a
deal probably would be McCurdy, as well ss a few others. The DCl
indicated that such a deal would be all right with hla. (C/NT)
*%
Cj/^ /V33
m
[Motht Rifirirr j
'5o5u
1071
3 <^ v7"^<V<P"fe
C 200
Allen Ex.^^^
>30?JUN86 S=SAM^^^^^^^^^^^^
AFTER GREETINGS:
S-WE SENT OUR FRIEND m PRICE LIST FOR THESE 240.
IwHEN"''
Partially Declassided/Released on _Z(>J fUJ R p,
S-LAST THURSDAY, unOer provisions ot E 0 12356
■ by K Johnson. National Secunty Council
THURSDAY?
S-RIGHT IT MUST HAVE ARRIVED.
^Hs THAT THE SAME PRICE LIST THA* HE GAVE US 1»» WHTCH THE PtTICES WERE
^IX TIMES HIGHER?
S-NO THIS IS THE BASIC PRICE FOR THE 240 ITEMS. IT DOES NOT INCLUDE
TRANSPORTATION COSTS. INSURANCE, AND A FEW OTHER THINGS. JUST THE SALE
PRICE.
^■hE DIDN'T GIVE US THIS.
S-PERHAPS IT HASN'T .= [:.-CHED HIM. BUT WE SENT IT LAST THURSDAY.
^B?YOU GAVE HIM PRICE!' ((INAUDIBLE))
S-YES
(KhE cave us a PRICE LIST. BUT IT WAS NOT LAST THURSDAY. IT WAS BEFORE THAT
^ND WHEN WE FIGURED OUT THE PRICES. THEY WERE ABOUT SEVEN TIMES HIGHER.
NOW, I DON'T >^NOW WHETHER YOU'RE TALKING ABOUT THAT LIST OR SOMETHING ELSE.
S-SOMETHING ELSE. THESE PRICES THAT HE GAVE YOU INCLUDED EVERYTHING —
TRANSPORTATION. ETC. WHAT I'M TALKING ABOUT IS THE PRICE FOR WHICH THE
240 WERE SOLD.
\BsO IF YOU SENT IT ^Hi.iRSDAY, SHOULDN'T IT HAVE ARRIVED BY NOW?
S-IT SHOULD HAVE.
^Bl'LL GET IN TOUCH WITH HIM TONIGHT, '^^IF I CAN LOCATE HIM??
S-LOOK. MR. GOODE AND i ARE IN A BAD SITUATION HERE.
\B-UHY''-'
S-BECAUSE THE HEAD OF OUR COMPANY IS VERY TIRED OF THIS DEAL; HE WANTS TO
BREAK IT OFF
HM'^- -E S.ME POP .E HE.. iiMPi AQQinrn
1072
UWiSSW
S-FINE. THEN BOTH OF US ARE IN THE SAME BOAT. C 201
fcwHAT?
S-WE ARE BOTH IN THE SAME TRENCH. WE'VE GOT TO BRING THIS THING TO A
CONCLUSION AS SOON A3 POSSIBLE
tJo
<(FEW WORDS MISSED >) MY SITUATION IS EVEN WORSE HERE. ((FEW WORDS))
row. IF THESE PRICES APE LOWER, WE CAN PRESENT THIS PROPOSAL OF YOURS.
S-LOOK. THIS IS UP TO OUR FRIEND IN EUROPE.
■-CAN YOU GIVE ME THE PRICES YOURSELF?
S-I DON'T HAVE THEM.
HwHO HAS THEM?
S-UH, ONE OF THE EMPLO^tES OF MR. GOODE SENT THEM. I HAVE NOT SEEN THEM
AT ALL.
Hr??WHEN WILL THEY GE"' TO US (( INAUDIBLE ) )
S-UH. THEY MUST BE irJ OUR FRIEND'S HANDS NOW. YOU WILL HAVE TO ASK HIM.
^M( (INAUDIBLE) >
S-HE HAS THEM. YOU WILi. HAVE TO CONSULT WITH HIM.
^|((FEU WORDS)) WE TAL^^ WITH YOU?
CLASSIFIED
S-FINE. THAT MIGHT DS: t^OSSIBLE IN THE FUTURE. THAT'S WHAT WE SAID WHEN
WE WERE TALKING WITH i CU IN DUBAI. ((TEHRAN)). WE SAID THAT IT WOULD BE
BETTER IF WE APPOINTED TWO PERSONS TO BE WITH YOU ALL THE TIME FOR DIRECT
COMMUNICATIONS. THEN THESE MISUNDERSTANDINGS WOULD NOT OCCUR. DO YOU
REMEMBER WHEN WE SENT ■ Ou THAT VOLKSWAGEN. THIS WAS GOOD. THE PRICE WAS
VERY GOOD. THE BEST POSSIBLE PRICE.
H-LOOK. ALI, I KNOW IS TVIAT HE SENT US A PRICE, t^ WHEN l^E FIGURED
~ OUT IT WAS'SIJf TIMES H I CHER .-^( (FEW WORDS MfSSED))
S-THE PRICES WHICH WE SENT WERE THE BASIC PRICES FOR ALL THE 240. WITHOUT
TRANSPORTATION. INSURANCE, AND THINGS LIKE THAT
[B?WITHOUT? TRANSPORTATION AND INSURANCE?
S-AND ADMINISTRATIVE COSTS. AND FOR CLEANING OFF ALL THE CRATES.
^|l COULDN'T HEAR YO'J SPEAK UP
S-THE PRICE THAT WE SENT DID NOT INCLUDE TRANSPORTATION, INSURANCE, AND
OUR FRIEND'S PROFIT.
^Rw
INE. YOU TELL HIM TO GIVE US THOSE PRICES SO WE CAN SEE HOW MUCH
iWER THEY ARE IF THE PRICES ARE ACCEPTABLE, I CAN PRESENT YOUR PROPOSAL
S-V^Y ©OOO B^JJ I'VE.(y3T NOTHING TO Oft ♦♦ITH^THIS. THIS IS BETWEEN YOU
AND THAT FRIEND OF O'JP's.
^(j5yH^(FEW WORDS) )HE SWDRt THAT HE DIDN'T TACK ON ANYTHING AND THAT THESE
1073
UNCLASSIFIED
202
WERE THE PRICES YOU GA.E HIM.
S-FINE. YOU WILL ±1AVE to SETTLE THIS W^TH OUR FRIENB AS 80eN AS POSStBLE.
TALK UITH HIM. LT'S tOT NOTHING TO t)0 WITH US I JUST WANTED TO T€LL YOU
THAT THE HEAD 0F_ OUR COMPANY HERE IS MOST UNHAPPY, AND WANTS TO CUT IT OFF.
^HwHO WANTS TO CUT IT IFF?
iS-r»E HEAD OF OUR COMPANY /hE SAYS. "IF THEY WANT THEM. THEY SHOULD BUY THEMj
IF THEY DON'T WANT THEJI. THEY SHOULD CET THEM SOMEPLACE ELSE. "
^BfO»»'TME same PRICE'
S-THAT'S BETWEEN YOU A^Jb OUR FRIENBt
< (INAUDIBLE))
■
S-1
Mil
1
S-THIS LIST WHICH WE ^g{AT_.aiNTAINS THE PRICE EOR VjHirH ATtUJin mi Tl Tfl THE
MIOOUEMAN. 'THI9 FRIB^ OF OORB BOMHT K fWoT^Ih^ HIDBLE^AM.
( INAUDIBLE) )
S-WELL. UNFORTUNATELY. IN THIS INSTANCE. THERE IS NO OTHER SOLUTION. WE MUST
THINK ABOUT THE FUTURE
|H<<FEW WORDS MISSED) > YOU WERE SUPPOSED TO GIVE US THE FACTORY
PRICES. IF YOU GIVE US THIS PRICE. DON'T YOU KNOW THAT. . .THIS
FELLOW SAYS THAT HE 13 NOT TACKING ON ANYTHING. HE IS NOT USING
ANY ((WORD MISSED)) HOW MUCH IS THE TOTAL PRICE?
S- THEY SAID THAT IT UJAS ABOUT 43. IS THAT RIGHT?
^^45?
S-RIGHT. ((ONE WORD); 1HE 240 AND THE TWO CHUTIS.
^KjITHOUT the LOADING AND INSURANCE
S-I DON'T KNOW. I'M JLIST. I MEAN, I MEAN THE TOTAL PRICE, I MEAN THE
TRANSPORTATION, AND THE TWO GHUTIS AND THE 240, AND THE INSURANCE, AND.
ABOUT 45 I'M REALLY NOT INVOLVED IN THIS. IT'S ABOUT 45. RIGHT?
^HwAS 45 THE PRICE VOU GAVE TO HIM?
S-NO, NO. Wg^Dia NQT_-««^ THE" W»1CE. UE xA>ST AUTHOftilED THE COMPANIES TO
SELL THEM TO.^Sk'ERAL hIDDLEMEN. OUR ERJlEMa^AOUCHT- THEU FROn MIDDLEMEN
jH ((FEW WORDS) >THE PPICE AS IT NOW IS. DID OUR FRIEND ADD TO IT OR DID YOU
■>('FEW WORDS) >'!'
S- NO. WE WERE NOT Ol^PSELVES INVOLVED IN THIS DEAL. THIS IS HOW THE
TRANSACTION WAS. WE AUTHORIZED THE COMPANIES TO SELL TQ SEVERAL MIDDLEMEN.
THESE Minni FMFH^gQl n in nilR _f pit-yn this PFTCE THAT" WC- SENT TO OUR FRIEND
IS THE PRICE THAT THrTOMP ANtES SOLD TO-THE-n»DLE«EN.
VH((FEW WORDS) )DID THEY SELL IT TO OUR FRIEND'-'
1/2)
S-NO, NO OUfT FRIEND DOOGHT IT FROM THE" MTDPLenCM. ^^rBllI flWIrIi*!
UR FRIEND BOUGHT IT FROM THE MIDDLEMEN
1074
UNCLASSIFIED
C 203
S-YES. AND THE MIDDLEMEN BOUGHT IT .FROM IM£ ^OMPAMMV UB^HERECY AUTHORIZED
THE SALE OF THESE 240 AMV THE PRICE LIST WHICH WE SENT. IS THE PRICE FOR
WHICH IT WAS SOLD- TO Tv'E KIDDLEMEN.
m
THE PROBLEM IS <( FEl^ WORDS)), I DON'T THINK THAT.
S-THAT'S WHY WE HAVE ALWAYS SAID THAT IN THE FUTURE WE MUST BE IN DIRECT
CONTACT FOR THINGS LIKE THIS. IT'S EASIER AND CHEAPER.
B( (INAUDIBLE) )
S-THIS TIME. IT HAS TO BE THIS WAY. THE HEAD OF OUR COMPANY IS VERY TIRED
OF THIS. HE'S ANGRY, HE SAID. "IF THEY DON'T WANT TO DEAL, BREAK IT OFF. "
TTbU
OOK. THE PROBLEM IS THE PRICE. I HAVE NOT YET BROUGHT UP THE MATTER OF
UR PROPOSAL THE PRICE IS AN IMPORTANT MATTER FOR US. ABOUT THE PRICE. YOL
SAY THAT YOU CAVE PERMISSION TO THE MIDDLEMEN TO CO THERE AND MAKE THE
PURCHASE.
S-RICHT.
BwE DIDN'T MAKE THE FEQUEST OF < fFEB- II0TO9r>T- UB> HADE THE REOUERT OF YOU.
S-WELL. WE HAD NO OTHER ReCOUBSE; IT HAD TO BE THAI WAY — FOR THE PRESENT.
IN THE FUTUREi»'WE MIQHT BE ABLE TO ARRANGE SOMETHING. BUT NOW.. THE IMPORTANT
THING IS. IS THERE GOlriG TO BE A DEAL OR NOT.
1
THE IMPORTANT THING--FQR US MOU I& TtMA-XMEfi^lgBICES YOU GAVE ARE SIX TIMES
E ORIGINAL PRl£ES^^UlM<pr M IlWUW'atii FUll^b. " ll#ilMl><M EFFECT ON THE
OUTCOME. THS» S0n. THIS IS NOT GOOD RELATIONS TO SELL SOMETHING FOR SIX
TIMES THE PRICE
S-I CAN'T DO ANYTHING ABOUT THAT WHAT CAN I DO ABOUT IT?
^'
ELL, LOOK YOU ARE THE ONE UE'MHE. BIEUM I AT I NG WITH. VUtTTWOW PERSTHfT AND
IS YOU WE ARE TALKING TO.
S-BUT MY HANDS ARE TIED. THESE 240 HAVE BEEN SOLD TO SOMEONE; HE BOUGHT IT
AND RESOLD IT TO OUR FRIEND. WHAT CAN I DO? IT'S BEST THAT YOU BUY THESE
GOODS SOMEWHERE ELSE THESE WERE VERY DIFFICULT . .
HLf we buy THESE. . .
S-CAN YOU GET BUY THEM SOMEWHERE ELSE?
\M|^ INAUDIBLE))
S-NO. NO. IT WAS A VER. DIFFICULT THING TO BUY ALL OF THESE 240, BECAUSE THEY
ARE VERY SCARCE. AS VCU KNOW, SOME OF THEM WERE OUT OF STOCK.
<fe^.
INE. I ACCEPT THE FACT THAT IT WAS DIFFICULT, BUT SIX OR SEVEN TIMES
THE COsY? THIS IS NOT RIGHT. THIS IS HAVING AN EFFECT ON THE DEAL — ON YOUR
GOOD WILL THAT' YOU WISH TO ESTABLISH. AN ADVERSE EFFECT. THEY ARE SAYING,
"ir THEY WANT US TO DO THIS SERVICE, WHY ARE THEY CHARGING SIX TIMES THE
PRICE? WE HAVE NO PROBLEM WITH OUR FRIEND THAT HE IS ASKING THIS. WE HAVE
NO PROBLEM WITH HIM. WE SEE THIS AS YOUR FAULT ((FEW WORDS. )) TELL US
WHAT THE PRICE IS. WHATEVER IT IS. WE HAVE NO QUARREL WITH A 5 OR 10
PERCENT MARKUP, BUT 6J0 PERCENT — NO.
)II(D
■^^J S-BUT IT ISN'T 600 PERCENT.
UNCLASSIFIED
1075
iiNCUSSifim ,
J 204
YES IT IS. IT'S M0=!£ THAN THAT. IT AVERAGES OUT TO 6. 15 TIMES HIGHER.
S- YOU SAID THAT-YOU HAVE A MICROFICHE. HAVE YOU SENT IT TO ME.
YQU CAN GET ONE OF THOSE YOURSELF. I 'LL SEND IT TO YOU. I 'LL SEND IT
A FLIGHT TOMORROW < (PORTION MISSED. )) WE AREN'T GETTING THESE GOODS
FROM HIM. WE'RE GETTIKtG THEM FROM YOU.
S-NO IN THIS INSTANCE. YOU ARE BUYING FROM OUR FRIEND, NOT FROM US.
It MIGHT BE THIS WAY IN THE FUTURE. BUT NOT NOW IF THIS DEAL IS TO COME OFF.
It Hill ha5e to be through our friend, and if this deal is to be successful,
IT has to be through cur friend, there is no other way.
JBl DON'T think they WILL AGREE IF THE PRICES ARE SIX TIMES HIGHER.
S- YOU AND I ARE IN THE SAME TRENCH; YOU HAVE A PROBLEM. I HAVE A PROBLEM.
r?HE HEAD OF OUR CO«'ANY IS VERY DISPLEASED WITH MR. COODE AND ME.JPARTICULARL
WITH THE DELEGATION THAT WENT TO DUBAI. THE HEAD OF OUR COMPANY^S VERY
DISPLEASED WITH THE TREATMENT THERE. AND HE IS READY TO TERMINATE THE
SioLE dIaL I have my OWN OPINION ON THE MATTER* I WOULD LIKE TO SEE GOOD
RELATIONS BETWEEN OUR COMPANIES IN THE FUTURE.
K-SPEAK UP. SO I CAN HEAR YOU.
S- I WANT TO SEE GOOD RELATIONS BETWEEN OUR TWO COUNTRIES, BUT THIS HEAD
OF OUR COMPANY IS EXTREMELY UPSET.
FINE, IF YOU WANT < ( FEW WORDS)) HOW CAN WE DO ANYTHING FOR YOU WITH THESE
"ices? we SENSE THAT THIS IS <<ONE WORD))
«
S-IT IS NOT SIX TIMES HIGHER. IT IS MUCH LESS THAN THAT.
(AnO. believe ME THAT'S WHAT IT IS. I'M WILLING TO BET WITH YOU ON THAT.
S-FINE. BET WITH ME, B<JJ YOU HAVE TO SEND THIS MICROFICHE FOR US SO THAT
< (FEW WORDS)) IT
m
lUR)
'LL SEND IT. BUT < CFEW WORDS)).
S-WHO PREPARED THIS MICROFICHE?
«THIS MICROFICHE THAT UE HAVE NOW. IN THE MARKET. . ((STARTS OVER))THESE
PRICeI T^AT you cave US ARE BLACK MARKET PRICES. ON THE BLACK MARKET THEY
pSi PRiJeS T^AT ARE SEVERAL TIMES HIGHER. AND IF WE BOUGHT THESE THINGS ON
THE BL^CK mISIeT WE WOULDN'T HAVE TO PERFORM ANY SERVICES. SO WE WILL BUY
FROM THE BLACK MARKET .^JST AS WE HAVE UP TO NOW.
S-((FEW WORDS)) BUY FOR LESS ON THE BLACK MARKET?
WLq. these PRicE5.iijnT >rni. mm niMCM are dL;^^ "a«:;5I "^'.El^'^SSkv*'"
^?1CES 1 MHWTTO PROVE HERt THA:;^ It yE DO T>f»- SeRVtCE, ((FEW MOfWS-V)-
Yoiw^LLG^A POSITIVE ANSWER TO tWR ((FEW WORDS)). MY REPUTATION IS
BEING rSJiSeD BY ThIs THING. I WON'T HAVE ANY POWER TO DO ANYTHING FOR YOU
ANY MORE.
S-SOME OF THIS IS NOT IN MY HANDS. WE MUST UNDERSTAND THAT. .
ftllE ARE WILLING TO BUY THIS, BUT FOR A REALISTIC PRICE, NOT FOR SEVERAL
rrhES HIGHER. WE EXPECT YOU TO SELL AT THE CORRECT PRICE. ._«.
'^5^-9^
1H0I AQQinrn
1076
UNCUSSIFIED c
205
S-FINE. THE PRICE THAT'S RIGHT BUT IN THIS DEAL. hONEY IS NOT AN
IMPORTANT THING FOR US THE IMPORTANT THING. IS THE RELATIONS BETWEEN THE
TUO COMPANIES. ~^
|H<<FEU WORDS)) YOU INCREASE IT?
S-YOU HAV/E TALKED WITH OUR FRIEND ABOUT THIS. WHAT DID HE SAY?
%;
IE SAID. "THIS IS- THE PITTCt THEY CAVE- HE. " ((SENTENCE MISSEDJ). IS HE
LLINC THE TRUTH, OR NOT?
S-THAT'S RIGHT. I MEAN. WE SENT HIM THE PBICE OF THE 240. NOT INCLUDING
THE TRANSPORTATION^ INSURANCE, ETC, AND HE'LL HAVE TO TALK WITH YOU ABOUT IT
IT MUST HAVE REACHED HIM.
^■fwHEN DID YOU SEND IT FOR HIM? THURSDAY?
S- RIGHT.
>fl| DID YOU SEND IT Br ^;AIL.
S- WE SENT IT BY ONE OF THESE COURIER SERVICES WHICH DELIVERS IN ONE OR
TWO DAYS.
YOU
0 FRIDAY. SATURDAY . I 'LL CALL HIM TONIGHT AND SEE WHAT THE PRICE IS
YBU have given HIM.
S- FINE. I DON'T HAVE THE LIST NOW.
^■BCALL ME TOMORROW NIC-HT, AND I'LL GIVE YOU AN ANSWER.
^^LL FIND OUR FRIEND TONIGHT. LOOK. TRY TO KEEP THINGS GOING THERE.
WE'VE BROUGHT THIS THING TO THE FINAL STAGES AND ARE ON THE VERGE OF A
SOLUTION DON'T LET T--E ISSUE OP PRICE DESTROY UHAI WE'VE DONE. WE DON'T
HAVE ANY PROBLEM WITH ANYONE; NOT WITH OUR FRIEND OR ANYONP ELSE.
S- AND I AM IN THE SAr'E BIND HERE. BECAUSE I'VE WORKED A LOT ON THIS. AND
NOW IT HAS GOTTEN NOVJHERE. WE HAVEN'T ATTAINED OUR GOAL.
E MUST TRY TO ?PUFSUE THE RIGHT COURSE? HERE. NOW THIS PRICE THAT YOU
^NT TO GIVE. WE EXPECT YOU NOT TO INCREASE IT ANY.
S- UE HAVE NOT INCREASED IT. IF THERE HAS BEEN AN INCREASE, IT HAS BEEN
SOHEWHERE ELSE.
«
IF YOU HAVE NOT INCREASED THE PRICE. SEND US THE REAL PRICE.
S- WE'VE SENT IT TO ThST. FRIEND.
VERY GOOD. I'LL CONTACT HIM TONIGHT.
S-FINE. WE MUST NOT LOSE THIS OPPORTUNITY. BECAUSE THE TIME IS VERY SHORT.
FINE. I 'LL GET THIS ^iRICE TONIGHT. THEN I WILL BRING UP YOUR PROPOSAL.
S-VERY GOOD
S-l
ONCLASSIFIED
1077
The Director of Ceniral Inieltijcnce
vDcmos
28 July 1986
MEMORANDUM FOR: Vice Admiral John M. Poindexter, USN
Assistant to the President for
National Security Affairs
SUBJECT;
American Hostages
0176
After discussing. the release of Father Lawrence Jenco with Charlie Allen
and Dewey Clarridge, I believe It Is Important that you have our assessment of
this development and prospects for release of additional hostages.
First, it is indisputable that the Iranian connection actually worked
this time, after a series of failures. You will recall that the ^MMM^ .j^
Ghorbanlfar connection also resulted in the release of Reverend. ^^^^^^
September 1985.
After the impasse in Tehran over in late Hay, jmSHB|Ht# continued to~
initiate direct contact with one of my officers, George Cave, even though the
Iranians had beentold^hat we were no longer Interested in pursuing the matter.
The fact that JB^pV^terslsted in contacting us Indicates his desire t* arrange
a "deal" with Washington. either through Ghorbanlfar or, if necessary, wl- Cave.
He also clearly wantedfp keep a channel, open. Amiram Nir, Special Assi^:ant to
the Prime Minister of Israel on Counter-terrorism, has also played a critical role
in a deteralned effort to force Iran to begin the release of American hostages.-
He has been supported by Prime Minister Peres and Defense Mlnister'Rabin in
this endeavor. In order to make the terns of the arrangements more palatable, '
Israel, on its own, offered additional arms "to sweeten the deal."
he transferred J4 minion to a west turopean bank to pay his European Intermediary
for the HAWK spare parts removed from our mission aircraft In May. On Wednesday,
23 July, when no hostage had been released, Ghorbanlfar was instructed to Inform
that 'the deal was off.
Partially Oeclassifieb/Released nn 2tpJftN 88
under provisions ol E 0 12356
by K Jonnson. Nalional Security Council
S(^l
'>JJ/2) ^S^7 / R Ol
1078
r
NF/NtyuL ■
0177'
In return for the release, J|H|0[P probably expects to receive
most of the HAWK spare parts not yet delivered, along with additional
military equipment that Israel unilateral It has added to the arrangement.
Once this equipment is delivered.mpKMk^t^ted that Iran would take
action to obtain the release of one more hostage and would pay* the remainder
the money owed to the Iranian intPrmpHiary for the HAWK spare
moreover. Indicated a willingness to meet with U.S. offfcials again on these
matters, either in Tehran or "somewhere else'*..r'> presumably Western Europe.
. Jhis Js:hoR:we secHhl cufteot s(tuatlOn:^Z,r'. /. :; , ...;,,..
-- The Ghbrbanifar^l^BlPto connection has worked for the second
t\me — and another American has been released.
-— '6hbrban1far-1s an vncontrolTable factor, but appears to respond .
^ -"--oenerally
--'" Nif has^everyreasdn to work for furtherTfTfRf^TT 6ur hostages.
:"-'-Peres aiid Rabin have "put their reputation/on ;theGhorban1far-i
."-"'Hronnectltfii and support Hlr -fully .In, hfs endeavors.. There woulTl be
considerable loss of face for Nir and his superiors if the link were /
'-•broken. "This connection :.appears to be 'the only hope they have for./
•i -recovering their own mfssfng. sol41er$,v.L,-
t^.= ■"•^^••^-"/•.■-"- _. r '-•-.'■ - -, •- \ •■ '
— 4|^0H|i^has now acted and likely expects the United States to respond
quickly In turn by delivering most of the remaining HAWK spare parts.
He probably believes the United States Is also supplying the additional
military equipment that has been promised.
— Whether we are prepared to negotiate or meet their demands or
expectlons at this point, we should find out what they are.
If the deliveries do' not occur, ^0H|. will lose ))ad1y with his
sup't^drs^Te'hrarf'and oisttinT.coalorrum ugly ,• especially since the .
'IVb'a'nVse" "Hizballah 'captors ifrobably arre not pleased .with the Jenco release.
-.:.--. -, '.ziTi -.i':i .''e-: =.. -.:::. ... - .. .. .- . ^
If there is' no USS 'contact a's V result of Jenco's release, it, is entirely
possible that Iran and/or Hizballah could r«sort to the murder of one or
more of the remaining hostages.
'^sfTdl
1079
r
^wfu
0178
In surmary, based on the intelligence at my^disposa/, .1 believe that
we should continue to maintain the Ghorbanifar-^MMf|^ contact and
consider what we may be prepared to do to ("eet^lHPimfc minimum requirements
that would lead to release of the rest of the hostages. Although I am not
pleased by segmented releases of the American hostages, I am convinced that
this may be the only way to proceed, given the delicate factional balance
in Iran. I also see resolution of the hostage issue as potentially leading
to contacts with moderate factions in Iran that we may be able to deal with
In the longer term.
Casey
i^tr'crs ■• r cr^"'!'": t'z ~i'~z"'
^s-^
%
S/fi
1080
lenEy"*^^
-^ 1 C o- (- .
r- c -r r i.-. ->
2. 7JTc^.y^/^
N 10350
z
Parliaily Declassified/Released on_'2-(;J ftiOgfe
unde' provisions o( E 0 12356
by K Johnson, National Secunlv Council
?C)3'
UNCUSSiriED
RECEIVED
r -1
:,-: 23 198«
Ccp/ ''^ .'Receipt
1081
ROUTING
T«
Hamt <nd Addrttf
Oat*
InitKit
The President
-
ACTION
FILE
APPROVAL
K
INFORMATION
COMMENT
PREPARE REPLY
CONCURRENCE
RECOMMENDATION
DIRECT REPLY
RETURN
DISPATCH
SIGNATURE
REMARKS
cc: Oliver North (#2 and 3)
Jim Radzimski (#4)
TOP SECRET
TMENTED IN^-BWWTl
t
N 10351
NSOICS CONTROL NO. 42013
COPY NO OF
HANDLE VIA SYSTEM IV CHANNEL ONLY
NSC INTELLIGENCE
DOCUMENT
Pamaliy 0ecla5sified/Reie3sed on 2G J <t-<Jg8
unoer provisions of E 0 123S6
by K Johnson, Nanonal Sscunly Council
A
Warning Notice
Inttlligcncc Sources and Methods involved
NATIONAL SECURITY INFORMATION
Unauthorized DiKlosureSubiect to Criminal Sanctions
TION
1082
UNCUSSIFil
27 June 1986
N 10352
SECRET -
Lengthy meeting thi^^^ternoon with Gorba and Nir followed by
discussior^jrit^J^PHJI^^via phone. Following are salient
points. ^m^^^^^eReves he has demonstrated his ability to
perform an^na^^xpectations we are now prepared to deal.
Despite our earlier and current protestations that we want all
hostages before we deliver anything, this is clearly not the way
they want to proceed. They se^clearly that the ball is now in
our court. In discussion with||H|mHph^repeatedly asked quote
"When are you going to delive^T^wn^eUBBH^rade no
specific threat, he noted that he was unde^intense pressure and
could not totally control events. We will call him baclc 28 July
at 1100 Frankfurt time and urge that he come to Europe for a
meeting and to do nothing rash in the meantime. We are trying to
•Take this idea attractiver"
Jenco has expressec
lesire CO thank the three Wflfr^T^SBBTs responsible for his
release. The Pope, The Archbishop of Canterbury and RR. The
first two inten^^^oblige. Can we deliver on the last? Unodir
we will call^l^^l^^ in A.M. and urge him to meet us in Europe
ASAP. Since it will take him several days to get authorization
to come, we plan to return to D.C. via Pan Am 061 on 28 July and
report to JMP xn evening. Please advise via this channel if
other instructions obtain. Warm regards. North/Cave
Bottom line, is that if we want to prevent the death of one of
the three remaining hostages, we are going to have to do
something.
iLUiZL^
^.jUj.
J >6w* CJi^ ^.*,*A. jt
Partially Declassified/Released on 2bJ>f<0 86
under provisions of E.O 12356
by K Johnson. National Security Council
^
[
r
1083
NATK3NAL S6CUWTV COUNOL
WAS»««1T0N. 0 C 30000
July 26, 1986
SYSTEM IV
NSC/ICS-42013
N 10353
<
TOP SECRET
ACTION
MEMORANDUM FOR JOHN M. POIMDEXTER
FROM: OLIVER L. NORTH
SUBJECT: American Hostages
COMPARTMENTEO INFORMATION
Attached at Tab I is a memo from you to the President outlining
what we know of the Jenco release. Attached at Tab II are
talking points for use by Cave/North with Nir/Ghorbanifar/
in Frankfurt, GE.
Cave IS departing Geneva tonight tcj meet Horth/Secord m
Frankfurt tomorrow (Sunday) mornin^^jlir and Ghorbanifar depart
London tomorrow and have called a^^H^^ to meet them in
Frankfurt, GE, Sunday morning. The purpose of the meeting is to
assess Iranian expectations and ability to release the remaining
American hostages.
A draft of the DCI assessment on the American hostages and the
Jenco release is attached at Tab III. This paper was prepared by
Charlie Allen and Dewey Clarridge and has been delivered to
Director Casey.
RECOMMENDATIONS
1.
Tab I
That you initial and forvtard your memo to the President at
Approve
'ifoiia.mz
iaapprove
r
2. That you approve,.North travel to and fzom Frankfurt, GE, as
described above. 7
Approve
3.
%r
Disapprove
That you approvelvthe talking points at Tab II.
Approve ^<-Jh' Disapprove
Attachments /
Tab i - Poindexter Memo to the President
Tab II - North/Cave Talking Points
Tab III - DCI Assessment of Hostage Situation
TOP SECRET
Declassify;
COMPARTMENTED INFORMATION
OAOR
1084
•we
N in3F4
UNCIASSIREO
1085
WASH I NOTOf
TOP SECRET
INFORMATION
SYSTEM IV
NSC/ICS-42013
N 10355
COMPARTMENTED INTORMATIOH
MEMORANDUM FOR THE PRESIDENT
FROM: JOHN M. POINDEXTER
SUBJECT: American Hostages
The release of Father Lawrence Jenco is a second positive step in
our protracted and difficult dialogue with the Iranians. Father
Jenco 's release undoubtedly comes about as a result of Bud
McFarlane's trip at the end of May and the continuing direct and
indirect contacts we have had with Iranian officials. Our
Israeli contacts and the Iranian intermediary in Europe advise
that the Iranian Government now expects some reciprocal nove on
our part -- though exactly what, we are uncertai-.
decision to release Father Jenco was made in Tehran on or about
July 21. On Wednesday, July 23, our Israeli point of contact
advised us that "if, as we hope, a hostage is released, it will
be Jenco." It was also on this date that the Israeli point of
contact (Amiram Nir) told the Iranian intermediary in Europe that
the USG was breaking off all contact on this matter. We have
also learned that July 24 was a key date in the most recent
release:
The Iranian Government paid their European intermediary $4M
on Thursday, July 24, as partial payment for HAWK missile
parts, which were removed from our mission aircraft at the
end of May. (It is important to note that in order to pay
the Israelis for the HAWK missile parts, the Iranian
intermediary in Europe borrowed more than $15M and has been
under threat of death from his creditors. The Israelis
regard this payment as further proof that the Iranians wish to
continue the contact with the U.S. on the hostage issue.)
1086
TOP SECRET
\K»W
N 10356
COMPARTMENTED INFORMATION
Our next -step will be to have two USG representatives meet with
the Israeli and Iranians in Europe, if possible, tomorrow in an
effort to determine Iranian expectations. This is not a
negotiating session, but rather an attempt to maintain contact
and, if possible, assess how we should now proceed. To our
knowledge, no new Israeli deliveries have occurred and all
remaining HAWK missile repair parts are still in a covert depot
in Israel.
Prepared by:
Oliver L. North
TOP SECRET
OMPARTMENTED INFORMATION
1087
*%/}
N 10357
0
CNtUSSIflffl
TIfVS IL
1088
TOP SECRET
mmfii
•N 10358
COMPARTMENTED INFORMATIOM
NORTH/CAVE TALKING POINTS
You have seen the President's statement regarding the
release of Father Jenco. This is very much in line with
what your people had suggested.
Our government remains prepared to Open direct and private
discussions with your government leading to a normalization
of relations.
We recognize the important role played by your government in
the release of Father Jenco and regard this to be a very
positive step.
It is important that there not be any misunderstandings or
false expectations re-arding the release of Father Jenco,
On every occasion, including our meetings in Tehran, we made
it clear that we were not going to barter over the lives of
human beings.
While we are not empowered to negotiate with you regarding
any further deliveries of materiel, it is important that you
recognize that the understanding we proposed in Tehran is
still operative. We have been instructed to report back to
our goverr.rent any changes to this proposal.
We continue to believe that a direct channel of communication,
which will prevent misunderstandings is important. ^A^j^^
in Tehran, we are prepared to dispatch a^f^B^
fcommunications team to Tehran to faciliate tnis
c ommun i ca t ion .
TOP SECRET
Declassify:
"OTially Declassified/Releaseo on I / F«f « ftp
"Hder provisions of E 0 IP^^T"^"^
"^•^ Johnson, Na„o„aiSec4tunc,l
OADR
OMPARTMENTED INFORMATION
1089
SECRET
TERMS OF REFERENCE
U.S. -Iran Dlalogua
N 10359
SENSITIVE
Hay 21, 1986
I. BASIC PILLARS OF U.S. FOREIGN POLICY (Optional)
President Reagan cam* into office at a time when Iran had
had a certain impact on the American political process —
perhaps not what you intended.
The President represents and embodies America's recovery
from a period of weakness. He has rebuilt Ajtterlcan military
and' economic strength.
Most important, he has restored American will and
self-confidence. The U.S. is not afraid to use its power in
defense of its interests. We are not intimidated by Soviet
pressures, whether on arms control or Angola or Central
America or Afghanistan.
At the same time, we are prepared to resclve political ■
problems on the basis of reciprocity.
We see many international trends — economic, technological,
and political -- working in our favor.
II. U.S. POLICY TOWARD IRAN; BASIC PRINCIPLES
A. U.S. Assessment of Iranian Policy.
We view the Iranian revolution as a fact. The U.S. is
not trying to turn the clock back.
Our present attitude to Iran is not a product of
prejudice or emotion, but a clear-eyed assessment of
Iran's present policies.
Iran has us«d 'revolutionary Islaa* as a weapon to
undaraine pro-Western governments and American
interests throughout th* Middle Bast. As long as this
is Iran's policy, we are bound to be strategic
adversaries.
Support of terrorism and hostage-taking is part of this
strategic pattern. We see it used not only against us,
but against our friends. We cannot accept either.
Your influence in achieving the release of all hostages/
return of those killed (over time) is essential.
SECRET
Declassify t OADR
iBMSSF/ffl
SENSITIVE
82-688 0-88-36
1090
SECRET
SECRET
wmm
N 10360
SENSITIVE
W« 8«« your activity in many part* of th'« world,
including even Central America.
The U.S. knows how Iran views the Soviet- Union. But
subversion of Western interests and friends -objectively
serves Soviet interests on a global scale.
Thus, our assessment is that a decisive Iranian victory
in the war with Iraq would only unleash greater
regional instability, a further erosion of the Western
position, and enhanced opportunities for Soviet
trouble-making.
The U.S. will therefore do what it can to prevent such
a development. We regard the war as dangerous in many
respects and would like to see an end to it.
B. Possible Intersections of U.S. -Iranian Interests.
Despite fundamental conflicts, we perceive several
possible intersections of U.S. and Iranian interests.
I propose we explore these areas.
First, the U.S. has had a traditional interest in
seeing Iran preserve its territorial integrity and
independence. This has not changed. The U.S. opposes
Soviet designs on Iran.
Second, we have no interest in a Iraqi victory over
Ira
ire seexing an end to tnis
conflict and want to use an improved relationship with
Iran to further that end.
Third, we have parallel views on Afghanistan. Soviet
policy there is naked aggression, a threa.t__to all in
>n. ^_^^^^^^^^^^.^^^^^^_
^ ^^ I!^ZZ ^ut bur
objective !• tn« saaet th« Soviets siust get out and
let the Afghan people choose their own course.
C. U.S. Objective Today.
We have no illusions about what is possible in our
bilateral relatione. Perhaps this meeting will reveal
only a limited, momentary, tactical coincidence of
interests. Perhaps more. We are prepared either way.
In essence, we are prepared to have whatever kind of
relationship with Iran that Iran is prepared to have
with us.
Mmm
SENSITIVB
1091
SECRET —
vtmmB
N 10361
SENSITIVE
III. SOVIET MILITARY POSTUR£
Moscow has designs on parts of Ira n .^
Afghanistan illustrates th« pric* th« Soviets are ready to
pay to expand areas under their direct control.
Sunnarize Soviet capabilities along border and inside
Afghanistan which could threaten Tehran.
aware of Soviet activity in]
How they would do it.
Soviet plans
Iranian support to Sandinista regime in Nicaragua aids and
abets Soviet designs -- makes U.S. -Iranian relationship more
difficult ($100 million in oil, plus arms).
U.S. can help Iran cope with Soviet threat.
IV. AFGHANISTAN
Hay be real value for Iran and U.S. to find ways to
cooperate against Moscow in Afghanistan.
itance for refugees^^A
We need to know who you work with, what you elready provide,
and devise strategy to exploit Iranian comparative
advantage.
V. HAROWARK
We Bay b« prepared to resuae a liaited military supply
relationship.
However, its evolution and ultimate scope will depend on
whether our convergent or our divergent interests come to
loom larger in the overall picture.
What does Iran want?
SECRET
\immm
SENSITIVE
1092
N 10362
"wuss/fe
iinmim
TP* 1^
1093
The Dtrcdor of Cental IntdlfpKc
DRAFT
N 10363
July 26, 1986
MEMORANDUM FOR:
SUBJECT:
Vice Admiral John M. Poindexter
Assistant to the President for
National Security Affairs
American Hostages
After discussing the release of Father Lawrence Jenco with
Charlie Allen and Dewey Clarridge, I believe it is important that
you have our assessment of this development and prospects for
release of additional hostages.
First, it is indisputable that the Iranian connection
actually worked thi^^^me , after a series of failures. You will
recall '.'r.^z t^.eJJ^^^^'Ghcrbanif ar ccn.-.ect ior. alsc resu"
tne release of Reveren^wgir in September 1^85,
_^^^^^^^^^^^ After"
~rnr Tehran over in late May,'m^^^HH^^ycontinued to initiate
direct contact with one of ny officers, George Cave, ever, though
the Iranians had been told that we wer^n^lDnger interested in
pursuing the matter. The fact that ||||H|H[|H| persisted in contact-
ing us indicates his desire to arrang^^^oeal" with Washington
either through Ghorbanifar or, if necessary, with Cave. He also
clearly wanted to keep a channel open. Amiraun Nir, Special
Assistant to the Prime Minister of Israel on Counter-Terrorisn,
has also played a critical role in a deternined effort to force
Iran to begin the release of American hostages. He has been
supported by Prime Minister Peres and Defense Minister Rabin in
this endeavor. In order to make the terms of the arrangements
more palatable, Israel, or. its own, offered additional arr.s "tc
sweeten the deal."
To reinforce this
European bank to pay his
European intermediary for the HAWK spare parts removed from cur
mission aircraft in May. On Wednesday, July 23, when no hostage
«
''^^Ifll^
1094
DRAF1
N 10364
In return for the re lease^^^^^^^B probably expects to
receive most of the HAWK spare parc^Tot yet delivered, along
with additional military equipment that Israel unilaterally has
the arrangement. Once this equipment is delivered,
1st a ted that Iran would take action to obtain the release
one more hostage and would pay the remainder of the jncney
the Iranian intermediary for the HAWK spare parts.
■1£ - =
'somewhere else"
rioreover, indicated a willingness to meet
aziir. en these natters, either in Tehran .o'r
presumably Western Europe.
This is how we see the current situation:
The Ghorbanifarj
second time — an
connection has worked for the
'mt American has been released.
Ghorbanifar is an uncontrollable factor, but appears to
respond generally to Nir's direction.
Nir has every reason to work for further releases of our
hostages. P^^^^nd Rabin have put their reputation on the
Ghorbanifar-^HJ^^^^connection and support Nir fully in his
endeavors. There would be a considerable loss of face for
Nir and his superiors if the link were broken. This
connection appears to be the only hope they have for
recovering their own missing soldiers.
f has now acted and likely expects the United States
CO respond quickly in turn by delivering most of the
remaining HAWK spare parts. He probably believes the United
States is also supplying the additional military equipment
that has bean promised.
DRAFT
1U»D
DRAFT
N 10365
If the deliveries do not occui^HH^H^^ill lose badly
with -his superiors in Tehran and matters could turn ugly,
especially since the Lebanese Hizballah captors probably are
not pleased with the Jenco release.
If there is no USG contact as a result of Jenco' s release,
it is entirely possible that Iran and/or Hizballah could
resort to the murder of one or more of the remaining
hostages.
In summary, based on the intelligence at my disposal,
that we should continue to maintain the Ghorbanifar-
:t and consider what we may be prepared to do to
Iheet^^^^^^^l^ minimum requirements that would lead to release
of tn^res^ofthe hostages. Although I eun not pleased by
segmented releases of the American hostages, I an convinced that
this may be the only way to proceed, given the delicate factional
balance in Iran. I also see resolution of the hostage issue as
rote--,i5.1y leadirc to cr-tacts with noierate facticr.j in Iran-
that we may be able to deal with in the longer term.
William J. Casey
%
^*^|P
DRAFT
1096
HSttHSSW
!
C 209
^H Deciassified/Rele3sed on
under provisions Ol E 0 12356
by K Johnson. National Security Council
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1097
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by K Johnson, National Secar,ty Council
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^ C 213
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2 S«pt««6«r 1911
MIMOMNOUM roil THE UCOMO
SUUICTt ltost«4«-Mlat«d Actlvitl«t
f
r«qu«st of 1r. Soed* on 3* *uquat> t contaetad Aba
I on an allaqad divaraion of US tow aiaailaa to. Iran, t had
'^*n alarttd to this davalopoant two day* •acUar by lr. Good*, who had
^••^toi^^y Ab4 that 1.3)0 TQMa waca aboMt to b« aiiippa<3 frea Houatoti to
^|HB|^P|than on to Tahcan. i had dlaeusaad this posalbia divacaion
^iT^luekllavall *t>4 Oala Hartall of tha t*l and •til Reaanblatt and Gary
wahl o( Cuatoas.
]. Oft rriday avanina, 2< >uagat Aba inforaad •• that ha had laacnad
froa hia »*n in London ^HBlBllitok ^*^*^ ^^* TOMa would b« ahlppad
within 41 heucs ogt o( Houaton. Aba itatad that haaipaetad to qat tha
*"**' l^gTY aifai gapfabat, bgt that hta tinn'*** JMfc had baan told
_^ ^[that a ahtpaant was laainant. Tha ahlpaant eenalstaS
saeond 9«nacation of TVa which vara tailing at 8U,00» apiacai four
unnaaad Aaaclcana_wata involvad. Aeeo_fdin^ to Aba,^^^^HB| i« talatad
to mmHI^HI^IHHHHI^^^HHHmil^^^l^^^ '^* ^^*
wara to ba flown fcoa Houaton^^^^^^^^b^o^^^anaahipaant on to lean.
9. Sasad on this Inforaation and Xr. Oooda's raquasi that action ba
takan, I inforaad both tha T\l and Custoaa of tha naw inforaation and waa
aaaucad that action waa bain^ takan. in fact, t was in touch with Mr.
wahl aavaral tlaaa en 10-U Auquat and on 1 Saptaabar. Hr. wahl
Indieatad that' Cuateas had allocatad a lar^a nuaboc of a9anta in »n
affoct to stop this allaqad dlvartion.
4. On 1 Scptaabar, Aba callad •• ucjantly to atata that ha had
acquired soaa naw inforaation that could radically ehanq* our currant
TQM di»af alon. Ha aaid that ha h^^^A|L^in talaphona
LlM t<onden. 90///lft\td talkad withfl^^^B^in
had rafusad to provlda tha naaas of tha (our Antrieans
tcanaaction, elaialn^ that tha Aaarleana niqilfit ba
Tttvaalinq their naaes could put hit \ila in jeopardy.
*aaf la-typ««'
S. Aba atatad that froa what ha has learned of tha, transaction to
data« tha footprints of tha aatchant and his banker ara 'all over this
transaction.* na banker can obtain end user cartlfleatas and tha
aarchant has established two letters of credit with banks in Swittarland:
'^rtiai.y De:lc.3ifi.._/ ■
-M
■:r.-';r pro- r:c ■
'7 0..^^:- :..t;oPs'
' .'C'Jri'y C',
ttf^SSIHI
>^45l
1102
UNGEXin
^
V
v:
V
V
on« of tfM Utt«C« of er«4it it Itvm th« London tcanch of (h« tc«nlan
N«tlen«l lank.. AM ipcoilattd th«i th«t« l«tt«ra of ectdtt could involve
tranoaetlona iriat th« Mreh«nt haa undarway with •tr. Gooda. Aceerdlnq to
Ab«-> ha had no infocaation Indicating tha^^^^pMa had baan shipped.
Tha plan, according to Atta, waa to qat^BH^^to London »h«ra h« »iix
b« wlnad and dined by ^[H^ and hopafully will tall all h^knew^beut
tha TOW tranaaetion. At that ttao, tha plan »aa to hava^^^^^ in
London on tha avanlnf of 2 Saptaabar. Aba aqain raitatatad that *tha
•arehanc'a n.O. ia all ovar thia tranaactlon,* noting that tha aarehant
did net «at paid until raeantly. Aba claiaa that ha baliavaa ona laitar
of credit la (or S|N and the ether for t%n.
t ha^^Hj^^^^^K^alnaMwaa^^Hli nd
telephone nuabara in^PH^^^B^|^|BHHIHflrHa wondered
whether the aerehani waa not operating laparataly; the prepeaad neuaton
■oy be laa^inaryt although there were probably (our A«erleana In
one point. Ab^aaid that the telephone nuitaMA.aI.Jj«i» a^ent,"
"London, flH^BBM^^HUHBBlHIftBHHABH^BHiW'C'nalon
Ab^eallad again on 2 Septanber to ajtata that.^^^ had been told
by^^^^^HUmHB^***^ ^'** •itpaani TOMa arrived laat
Tafiran^T^^raault of thia ahipaent, Iran la prepared to consider tha
release of tha Aaeriean hoaia^aa. Currently, Iranian ofdciala are
eaaainlnq the delivered TQHai if all ia in qood order, Tehran will
validate the letter of credit in the Swiss bank.
Jn tha 2 Sapteaber call. Aba stated tha^l^Bj^Nas (old by
that a aee^n^between 'the two sides* would now be scheduled
in swi tsar land. ^'^HHjHBya id thath^janta^H^te partieipate:^^|^
deaurrad at thia SB^WWon but totS^B^BB^Btnat he would get baeii to
hta. 4HBVt* cheek ijf^^^BBBH/at^*7^^^
Iceitecated that three,
hoata^aa were bein^relaaaad *n a result oc tna ton shipaent. Abe
eoaplained that l^^mil story aada no sens* all. although it waa
poaaibla that another operation waa underway with the banker and the
aerehant parlufs cotttnf out Adaa and Gooda. Aba stated that Abe would
not cofM t*_|^ttftj|* * result of tha latest developaents. Therefore,
all 90 to|^^^^|^aorrew to talk dicactly with
had
9. Aboeall«d aqatn en 2 Sept*aber to state that]
ealla^l^^^^qain and elaiaed that three hoata^aa ha
*wera on tha way to tha United Stataa* ftoa Tehran. Mhen I pr^
ji« did not aako any sania, Aba aaid^l^ waa calllnq*
iO check tha atocy. Abo then called back one aore t lae to state
^___^__^^^^^ ,ha (acttona and thev knew
nothino"abnut a 'neataae relaaaa. ^^Wj^^^^aa calladl
to check tha atorj
UNE^ntD
LW6
y - -
J 59
It^ia^aUg^Wy* I'Ml^f" > S«pt<»b«r to infara — th«t th«
■^^^B^^H^^^HHBHiH^Bi[^BBiBHB»a> 'war* th«
^ purported TCM trana«etle^4n4 th« aeveacnk e( th«M weapons In aachan^e
(or hoaia^as. iMiat^nS^^nad ootainad this fr
/* , H4 ad'lad that^m^l^elaiMd Rafaanjani waa not p«rBonair7
^^ knowlad9«abl« o( tho transact ten.
d;<H^«i^^^ —
National tntalliqanca Offtear for Ceuntartarrorla*
Oiraeter, Kt/Hoatafa Ideation Taak rere*
I
wmm
1104
IF'
.UNPiiSI
nof
i th.i'
he r^^.is
a! 1
r. J 1 S 0
listens •
:o
lot Of
I r 1 r. 1 3 n s
wno
;(■■■.,■..• n I 1/ '«scri:i«':' -: i s sources. H<> sf-i'
[ranii^n r.-»wsr)aT=rs tfi^Jt he c-jn '(^c his hands on ^
radio ^rc^ricasts . :)p also rdi:<s to exiles, sees -:
travel i-ir^ ani forth no Ir^n, -laintains soor-idi-r conr.art wif^ for-.ipr
CO 1 I'-i-u-^s >"-.; .'-=""-■) m m Iran, ^lut nerhaos His n-j""- importer;-. STjrc^
-f nf or~.i". . or, jre the renr°sentatives of impor "an': Innians '.-.-i^o
•a'.'^l -iirr:'''!"! or, iTu.t L,?es " . T'":e npst inoor''.in': o' '.hes'? is t"? na- .;-;,
to Iran,
2. Like all I r anians , ^B^irouns Irani
says that Rafsenjani head^one qro'jo, Kh
Troup known as the third line is header!
IS the real radical qrouo which supports
there are two other groups worth neniion
another groupiask about this one). 1^ sa
loy Rafsen^ani and once khoneini dies wil
^Asaid tat Rafsen]ani and Xhaneni ' i are
coonerate after Khomeini's death. Rafsen
the Sepah- i-Pasdar through Mohsen Reza'i
resistmq the -love to incoroorate the mi
2. San and Abe told^Bthat thers '-.'as
USG m tryincj to use trade to gradually
Iran. SaTi and Abe olanned to capitalize
contacts ir, the USG v;ith when they will
This of course requires i political deci
the Iranian qovernnent.
~a]ority of senior Irani
political reLgt ions with
Ii-e pople. (Hlsaid that
opps^e and sucn action as
laivS
said that he
want to re-e
USG wi;h the si
the current pro
lonq as he 1 iv
ans into pat divisions. He
ameni'i another and a third
by seyyed "'.ehdi Hashemi. T
terrorisn, etc.|^said tha
ina, Bazarqan's people and
ys that Montazari is do-^ma
1 be Rafsenjani's point :n^n
both brilliant rr^en and wfll
lani now effectively contro
Khaneni ' 1 has been
litary into the Pasdars.
an interest 'on the part of
re-establish relations witn
on tne trade part usin.-
coordmato their acticns.
sion at the highest level o
IS certain that the vast
stablish sor.s degree of
ngle exception of the third
bleTi IS that Xhomieri woul:;
s. GrTu-dwor< can be done
Is
;taolisn cot •
. le we cor.sic
>r senc.m'
suqqeste^ tn?. t
■.erican to do sor^e
contacting after around work nas ^een done.
tadialli Oetiar.si' rd/Reieased dnJ^^/y 1.
andef ^fowJ'<v^3 of £.0. J2356
. „ - ,^ tj ,<•.-. -f- - -^ ' •"=18^. m^ 'JiJatoM! fe&irt^ «our.ci!
^
///2.
'*^.\
vv
1105
(f
S o !
ir
CP
CP
JljJi^u
' " -• -N '2398^
ANDS ALBfTT HAKIM ON II !'l,Y laOr
"to sam. He said •ha: ;: wp 'lad f-jrrMer questions ne nai ■
ability to get the answers. Sam said he would take a look at th«
report and get back to him.
3. Hakim spent a lot of time explaining to^^Hthat he wanted
get some legitimate business with Iran for Cove^purposes. He w
willing to sell Medicinals at cost or on a credit basis with up
year to pay if he could get some other benifit out of it. ^|B
suggested oil sales to the .US which he was in a position t^^^^a
for fob S8.20 a barrel. Srfh suggested rice since the USG was
subsidizing the export of rice at prices far below the going wor
quotes. There was a questionas to whether Oil wa embargoed. Dur
the course of the meeting ,HH||ia id quite frankly that he wasn't
to do this for nothing and Haxim told him that if anything goes
through he would get a good commission._ Hakim told Sam that
planned to pursue these matters with
has also set up a private polygraph
no matter what
on Monday.
as
to a
Id
ir.g
going
we dec : r'ed . He
01^
■<r-
1106
/ L, A.i^ J-C
'*'^%Si^t\iJ\
60^0^
5<^^
1107
^ /Ve\
UMCLASSiriD
,^^ Loj^
"tote, 18^^^
Partially Declassified/Relfased on__i_K;V5(- f
under provisions ol E 0 12356
by K Johnson National Security Council
UNCLASSIFIED
1108
Cs
CWNi A04<^
UNCLASSiFi'tD
1109
/V)g ^-^^-
o'wci4ssfr:D
'lilCnUcb ^laica Senate
lELtCT COMM.TTEC O-. IMT t IJ. .C C~C t
W»S«i~OTO~ OC 20510
*^
j ^>j'%? l-^ ^' ■
IxJ-.
^.
o
■t-f.
1^1
QjlV*J0(3L
-Jon 3rt;^FC-
under provisions of E 0 12356
by K Johnson. National Security Council
50^1
IJNCLASSIF'ED
1110
*^«Ji«s:;:£D
CcH''
vZ^'h^^^^^
ej/v^ow
.V"
IPy Declassified/Released on3/-v^FF-
under provisions of E 0. 12356
by K Johnson, National Security Council
'OHs:
UNCLASSIFIED
nil
UNCLASSirED
No CtC|-
t_
Qe^f^tcyf- /- /7*A
djt>-'>Jt-
A ^^
4juiJ
UJO^
Ay
•43 M ^ tv.
fillen S-'s
6//V2fl^?
Partially Oeclassified/Releasefl on_i%§Sf,
undei provisions ol E 0 12356
by K Johnson, NaWnal Secuniy Council
UNCLASSlfltD
1112
1
• r-<(
« ^-*-»»A-ui< <y- — >( ( 0 *^1
A-oU**-c i- Ado - i-li ^ ^ o-v^
GilN 2PP\<4
iiNCLASSir^EO
1113
UNCLASSinED
dJiiVim
Partially DeclassKied/Released nn "-f /-£ ■9 ^6
under provisions o( EO 12356
by K Johnson. Nalional Security Council
mtx\ B^S2
h|^c,/S-[
mew
^HCUSSffe
1114
^^i^SSlHEd
■'^^T"
'(5^"
CliVJ1%
UNCLASSIFIED
1115
^HcussiFm
f:^- ;
'^
^^''^ c&i^rw:-
CJ\^l^^'a^^c
liHCLASSir.£0
1116
V\ ('03) '
/4**-oU 6^ u^id <A Mil"?
(Lll^l3^<=^u
.9
w V- _. - 5 i! ilia ktf'
1117
WathMtgron; DC
>*r 2^
^/7L
C-
h
^.Ji'' ^^^
A
-^ijj^zu^ ^,
-ev
^%/
^%£i?
<lUti ^f\^^^
UNCLASSIFiED
1118
CONFIDENTIAL
TV Dirccior of Cenlnl Iniclliiencr
wukn««>i.oc mm
G-A 's dc/tniiiCjbu
UHCUSSff3
"lie 05710-65 T-
15 November 1985 Rlferi t-X ^^
SUBJECT:
rles E. Allen
National Intelligence Officer -:r Counterterrorism
, and Narcotics
Visit of Mr. A/nlran Nir
This is to advise you that Mr.
Prime Minister of Israel, will be
ry office in the Headquarters buill
an Nir, Special Assistant to the
Ing me cr Monday, 18 November 1985, in
/^:^^r2^t^
Charles E. Allen
cc: GDI Security
Owj^-^^i
Partially Declassified/Released on_ J^ (.-^i^ '
under pmvisions ol E 0 12356
by K Jormson. National Security Council
?0M5
DECL fiAHP
CL byIMJI^V
confident::.
[TCTtre ieytni
'110
UHCUSS'iKtD
1119
UN^LASSIFltD
/ s ^->o J S:
The Oirtcioc of Ctninl Inidlictnot
.OC nm
C-^ 's(Ju\arc
NIC 05711-65 . J
15 November 1985 ^ll^ri Bk. ^ '
SUBJECT:
E. Allen
ional Intelligence Officer for Counterterroris.T
and Narcotics
Visit of
This is to advise you that|
will be visiting me in my office atHBuarters on 20 November 19S5 at 1600
hours.
cc: DOI Security
Charles E. Allen
'■•ally Cecl3S3,r,e!)/Rele3sed on 3 i^C '^Sp
unoer o/ovisions o( £ 0 1^^355
^' J"''"^"''. National Secuni'yCoundl
dWVJ 3*^^
CECL OAD£-^
CL BY gH^p
UNCUSSIFSED
j £:=:a!;ff tt;.:tn/'i'^l
UMCLIVSSlr'.W
1120
AJ6 AJ^-<
Allen 5<*5^
WKH^t^b
Partially Ceciassided/Reieased nn ■< /("ciFS
under provision: ol E 0 12356
by K Johnson. National Security Council
UMCLASSIFiEO
[wofae gfyjM ^g?e^ 7 ^
S:)^
1121
^'WCl/ISS/f:£D
wang 1661A
12/9/85
NOT
FROM:
SUBJECT:
7 0^ ^S'
Micheal Ledeen Phone Ca ) 1
1. Micheal Ledeen called to speak to you this mornlhg,
w1- hat he termed a "Flash* for you "to pass to Oewey". I
exp led you were out of town until Tues. night, but I was
your lief of staff - could I help? He hesitated for some long
fflomen s, then said no, he'd get the ^^^e to Dewey another
way.
2. Oewey is on TOY all week,
called back about an hour later ("Tf
wanting me to pass a message to Oewe
follows:
~,1s f}\
today I
be having dinner In Frankfu
»wn who arrived there yeste
; surprisingly Ledeen
|Mike, again"),
le message was as
Ito Frankfurt
He will
th at least two other
One of these guys Is
I don't know who
the other one Is. There may be more at the dinner,
but there will be at least these two.'
3. I went down to EUR and talked to the Oep.
sal^Oewe^ias handling everythlnqinvolved with thi __
||HB|B| So I calledfllHHjHA ->£&<: tfX'dk^
4. It tookHpll^a while to get back to me,
did, he seemed a bit confused. He did not know who
but said he would find out and handle all this with .
We agreed that we/he would have to move fast, because
we were down to a window of only a couple of hours. I
to^^^l tomorrow to see what--if anything--occurred
CL\\K3f\^^
[nortnthftrtn lfC66
UHCUSStf3
-artially Declassified/Released on ji rC6\
under provisions ot E 0 12356
by K Johnson, Nalional Secunry Council
5(p^e
82-688 0-88-37
1122
UNCLASSIF
Partially Declassified/Releasad on 3 i'Cfi¥>^
under provrsions ol E 0 12356
by K Jonnson. National Security Council
UHCLRSSIF5ED ^^
1123
"ffOUssiFi£o
UNCLASSIFIED
1124
4 ^/yr/i
'-y . j.7^^^^^^
**- i:^^C«.t4.
C<IV31?0
^J-*:^F
UMCUSSlFJtO
1125
miASSinED
• /v%t>ti4. -z: -e^ ,'
<'«-i
<2LX ^>i/C
/-
(TC-*-^'^!
y
« *^^ Ia^,
CllM3*1?0
unclassif:ed
1126
UNCLASSIFIED
UNCLASSIFiED
1127
liNCLASS!F:£9
n^
^aJ/BD Ja)
UNCLASSIFStD
1128
TIk Oireacr of CcMnI iMdliteHc
N»t
2 P«
NIC 00543-«6
3 February 1986
ef, European Oivision/000
SUBJECT:
les E. Al len
■ffational Intelligence Officer for Counterterrorism
Request for Support frofli Mike Ledeen
1. Mike Ledeen came to see me urgently on 1 February stating that he
required Agency assistance in obtainingMjpHB visas for two Iranian
officials. Ledeen, a consultant t^-t^a. National security CouncilJ
j<ho would accompany^
Ivisa some time ago
e other individu^
^^^ ie^lTtter also applied for a
^lo^yet been granted.
3. Ledeen stated that in or^er for him to meet with thes^ndividuals as
sart of his NSC work for Poindexter, it Is essential that^H^B issue both
^ Qsas for one year for multiple entries. Ledeen claims to
have met wftlil^^Bon two occasions and^sserte^hat Bud MacFarlane, f^onne^
_Nat1onal Security Advisor, wishes to meet^|[|||^^in the near future
4. I told Ledeen that I would oass the request on to you with the hope
that you could Inter veneMBBBipBiBHB|H|H
the visas are granted. ^BHrsdefimteiy part tof iM ^^^itant taction
in Iran and contact with him probably would be useful.
CharJ
Cllf/ ^^11
OECL OAOR
^HGUSSl^^^"
[MfB'jw Rtri-.trr \')%'i
Partially Oeclsssifiedffleleased on J FeePfi
under provisions of E.O 12356
by K Johnson. National Security Council
60^.
1129
AJc ^Lj^yi.
ItO D^/^- /l-.^l^
UHCUSSIFIED
50Sf
Partially Oeclassilied/Released on3_t&^^0
undei Divisions of E 0 12356
by K Johnson, National Secuntv Council
1130
<«MMiWPiV%M
QS\\i l\'i
UHCLASSlFitO
1131
PI ^l^^s^^
unclass»f;£d
1132
^r^ll,
. (To
OiM 3^1
UNCLI^SSIFIED
1133
UNCLAS
UNCLASSIFIED
1134
\?~-^-^,'^"*>''
^ rs?:ifej
ClW 39?
UNCLASSIFIED
1135
UKCLASSliE^ ^x
(Jf-Ji^tAJ
■ -^ 2
rox.Lv etc Co-*.»-vs.'^, r^^w-N
J
TO
(VeH- 3, O^o
. Tux i P^^ M to^l' nn^^
UNCLASSIFIED
1136
jl
bmASSIF!Ed
•<»**«""^M«rv«l^
ai»^cr<Lp/- ^t^
UNCLASSIFIED
1137
— *i<— WIIW*' ii|» WHi
1138
GJIIV3S«|
■" V ''^ '-
UNCLASSIFIED
1139
un€lassif:ed
\ A,¥^ .qijC"^
va--«C.rt»
UNCLASSIFIED
1140
UMiLA3S!FlED ^
M»< ■ iiji
7-^
<)^<^ <,^>*u^ a**/" W99-
Atv*-
_ ^fc^tf-*-**^
ilNCLASSIFSED
1141
WNCLASSIHEB^ -^^ ---^^r^
<^«^
'■■* II 'tmifmtli^mt^m
":)
UNCLASSIFIED
1142
^ftCUfifii
^CV -^i.4.<^ic<JL (^
''S—^J-QJ •'^^
C<^.
*/2-^^u«m5c
•^.^cK^Ua^ -«<2^^2>Cj2>
UNCLASSIFSED
1143
UMCLASfFJED ^^Tt^
'■■t—^-^t- iti^r^
UNCLASSIFIED
1144
-W-.
^•■^•^pawfMv
UNCLASSirlci
• • « ,
UNCLASSIHED
1145
UNCLAfS!F:ED
*i' > ^W 11
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• O
' ''tic
6_^x-,_^j2_ '^s^^^' <*-'^^ OkA^x.^
uHciivss\rtto
1146
UNeiASSIFfED
\(Mt^
C'
^/^/bD j^
To /^l^
yMCLRSSSrD
1147
UNCLASSiSEt
'vsrr^^^*-
UNCLASSIFIED
1148
WNCLASSIREO
UNCLASSIFIED
1149
UNCLASSIHED
TW Oirecia of Cc Jil l«dlitaa
NIC 02549-86
28 May 19§f
.. 0
rector of Qentral Intelligence
E. Allen
Intelligence Officer for Counterterrorism
fliten £<%o
SUBJEJ
Mia»el Ledeen
Natii^^^li*^'.,"*?^:!" "^"^^ journalist a«i consultant to the
^sS^LfT^^ ^^'^ ^'^^^ "^^ oounterterroria. hw requesteTBT
^t\^ ll^^JtHl -JL «K«i"t«nt wich yoa to "discussTsensiUve
2. Ledeen. as you know, worked I
latter was the National Security M\
aa a csansultant on oounterterroris
cleara-Tces. It is By impression.
direcUy with Ledeen but allows hLu
Howarc Tteiciier on intexriational teri
losely with Bud MacFarlane when the
He has been retained by Poindexter
stains all of his security
that Ftoindexter does not deal
tk with NSC staffers Ollie North and
and other Middle Extern issues.
Irar ^ SJ^i^^^ "^ Z'''' ^ °° ^K*^ '-^^ i" ^^^^ «^^ to discuss
a^'^tlnS a^„^„^L*i^ ««tB»lair George. Given his credentials
brie^ T^v^^^!L^ "^ "^^ ^ '^««'=«™l that you agree to meet with him
to <il on yoT^ ^^' ^ '^ *^'^*^* '•"-^ ^^ *" appropriate tin* for him
Hes E. AlTen
Partially Declassifled/Reteasa) on -S'Fe-'igR
under pfowsions ot E 0 12356
by K Johnson. Nabonai Security Counc.1
Ci/N 3S?<\
UNCLASSIFIED
1150
'^l^lfi ma
-,, , ^^^^ '^•'-T^ /'^/CQ^
J^^O *vt
^/'V 3<i^s
UNCLASSIFIED
• iiariy Oeciassitied/Released on J'-c'iff^
under orovisions ot E.O 12355
by K Johnson. National Secuniy Council
1151
UNCLASSIFIED
-/^^-cA^;
^->'^-C<j2j^
:5
/^) %
dl/^^^3
^iVCLflSSffJED
1152
S.,
^
» ^ . t
215
J^^^^ ^^'^---^ A»yt,Jl -.Xtc'^
Partially DecbDslfied'RslCciseci on_/0^*'*r~ "**
under pioviSiu's ol E C 12J.S(>
by K Johncicn N^itii.nr.i Sfc.-.lv Council
V^-'f^
505^
1153
UNCLASSIFIED
■ ^ ■ •: : 3
IT. -^jU.
UNCLASSIFiED
Partially Declassified/Released on 3 ^ <- ''' f"p
under provisions o( E 0 12356
by K Johnson, National Security Council
82-688 0-88-38
1154
i*«*
Cjin3\m
\iHCUSS\f?-tO
1155
UNOLASSiFJ
PHONE CALL WJ
UNCLASSIF'tD
I ON AUGUST 9, 19 86
1. AFJ^^HB^^^^^KE PROPOSED T0|HTHAT WE HEET IN EUROPE ON
OR abou^^^Kgust^^^^ke also presse^^to pay the merchant for
THE REC^^^pHIPMENTliPWboN AS POSSIBLE SO THAT FUNDS WILL BE AVAILABLE
FOR TH^^H" STEP. ^ SAID THAT HE WAS WILLING TO MEET IN EUROPE, BUT
DIDN't|^HkE want to get one of the REMAINING ACCOUNTS RELEASED AS
^OON A^^^EIBLE? CLARKE SAID YES WE WANTED THIS TO HAPPEN SOONEST.
^^SAID^^^LoNCE TH^IK SHIPMENT ARRIVES, HE WILL TAKE STEPS TO HAVE
THE ACC^^BuiBLOCI^^^R: IMEDIATELY. CLARKE THEN URGED^TO MAKE THE
PAYMENT ^^^^^^^^^F AS SOON AS POSSIBLE. V SAID THAT THE INVENTORY
OF THE LA^^^^^^^BiHOULD BE DONE BY 11 AUGUST. HE WILL SEND A CHECK
TO THE MERChJ^^^WedIATELY AFTER THE COMPLETION OF THE INVENTORY.
CLARKE ASKEri^^IF HE WAS CERTAIN THEY NEEDED THE 39 NUMBER 24 'S
BECAUSE OUR MILITARY DOESN'T USE THAT MANY IN 10 YEARS. ^|SAID THAT HE
HAD CHECKED WITH THE "EXPERTS" AND THEY SIAD THAT THEY MUST HAVE THESE
ITEMS.
2.^|WAS IN A VERY GOOD MOOD AND SEEMED PLEASED THAT WE HAVE SUCCESSFULL
COMPLETED PART OF THE DEAL. HE IN^Tgn CLARKE TO DINNER SAYING THAT
HE HAD GUESTS IN HIS HOUSE FOR DIn|^HhAT EVENING AND WOULD BE GLAD TO
HAVE CLARKE.
Partially Oeclassilied/Released nn j^ I C'^ bn
under provisions of EG 12356
by K Johnson, Nallonal Security Council
UNCLASSIr'iD
Cl/Aj ^6^17
1156
^^ *v- fv: . f/"— ...11-1.
I/NOOOKIT^, ^T/U.-Qfj
Tbe OirtctorofCeninl InlellitCToe
»utn|ivi.OC nwi
Nalional Inlelligcnca Council
28 Augus-. 985
/
^Jlerl by. (p^-
KEMORAIIDUM FX3P, TOE RECOPD
SUBJECT: Oonversation with Adam
01 74
1. On the afternoon of 27 August I called
detemine the current location of
2, Adam stated that the merchant almost certainly was n paris and that
he expected to receive a call from him in the next hour or *-,. He said that
he would be meeting with the merchant in Europe during his "nrthcoming travel '
to the United States.
Adam inquired whether Sam had been in touch telephv, i(;^]^y with the
"■ I told him that U) the best of my knowledge n^. 'xjnversations
between Sam and the ^g/gtttfj^ad occuz^ed or that any we^ planned.
(Actuall/> ^ ^^s aware that the JHimpi^^ had called Sam a-..^ ^^at very
significant information had been exchanged between the two -oiatinc to the
possicle release of another Anerican hcstaoe. Unfortj-atel.. ^ effort to
deflect A.ca-T's interest was q-aickly overcor>e because t^^* '•BMBi|biir ailed the
nerchant 4^3 infomed him in some detail about his corversc . ^^ witr. Sar.
Adan in t..rn called Goode to complain about the lack of a c-^.f^inated approach
in dealir.c with the flHrtHF^-^
cc: CNE
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under p-o««s,P'sic'at,!ifeffincil.
1157
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1158
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V
N 17663
55
1159
kf^hxraKKKK^^asfstytioootmo^cy/ORCoti
/c ^zf^S^
G/i<?/^-7 max/ I
10 Septerrber 1986
of Central Intelligence
s E. Allen
tor. Hostage Location Task Force
American Hostages
': il. I met with Ollie North last night at his office on American hostages.
OlliC' had just returned from a meeting with John Polndexter on the same
subject.
I ,2. Baindexter has given Ollie
idance on the American hostages,
Ollie is to continue to deve
through Albert Hakim and Die
Associates. (Hakim, <
Rafsanjani. H^HL_
and George Cave to meet wi
shipment of arms to Tehran.)
Inks to the Iranian Government
3rd of Stanford Ttechnolog^^
[i/are, has links tcflm^Hof
is attefrpting to arrange for Ollie
ijani, presumably with the next
, — Ghobanifar will be cut out as the intermediary in future shipments of
cargos to Iran, if at all possible. To cut Ghobaiiifar out, Ollie will
I. have to raise a mininLunn of $4 million.
■ — If there is no other channel for financing ftiture arms shipments, then
Ghobanifar will be used as a last resort. |
3. Ollie is greatly relieved by Poindexter's d^isions ^^^^^k>e feared
that} John and the President would shut down conpletely
Iran because of the kic
UN£lliilHE9,
VNOCONTRACT/OROON
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[SOteO
1160
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(^KWi-m,
UNCLASSIRE!)
Harliall/ OeclassitiedWelessfid on jLt^^SS
untfer pfovisions of E 0 l?356
by K Johnson, National Security Council
1162
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1163
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UNCLASSIFIED
1164
-£1
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UNCLASSIFIED
1165
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/ A-i*-S. Ckv.-*. /^,
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iiNCLASSIF:E9
Partially Declassided/ReleaseO on "■?/"»; ■qP^
under provisions ot E 0 12356
by K Johnson. National Security Council
1166
0.\\N 3^U0
UNCLASSlF'tD
/ f Sep- fC
C
5
to
^'WCUSS/fa
beartM Rtt^lnf /v6^
W^'i
|i«*Oeclassified/Released an3f^C'^PR
under provisions o( E 0 12356
by K Johnson, National Security Council
1167
<^:3eilsn
•73
^6ctn
\m}m^
4 , Aib
( 17 persons) .
4. One and one- ha If
certainty and possibly t
be released from the Leb
after the delivery of th
5. Through^^ae thod
Albert and^JBby to
missiles wi^^a naxi
delivered to Iran wi
provisions of paragr
TOW'S (500 received
AJid tne 1,000 TOW's
davs .
8 October, I 'iri' ^
Evening until midnight
o Mr. HakiB the price of SCO TOW
esired--the Hawk parts that remain froa
s later - -should Iran agree--five
Hawks together with donated medicines
mg the provisions of paragrapn number
e plan for the release of the Kuwaitis
Aaerican hostages in Lebanon (one with
wo through persistent effort) [sic) to
anese through Iran's effort, (5-4 days
e cargo mentioned in paragraph 2).
for opening of credit to be studied by
fflorro^^ught: Five hundred TOW
mum ^^Hie hundred launchers to be
thin^^B days after fulfilling the
aph ^^B Iran will pay for ISOO
and C^^W future ones).
willH^Bel ivered to Iran within nine
6.
techni
well a
and na
submit
del ive
7.
riu s 1 i a
re leas
8.
Iprope
9.
in par
Tlie Uii
cal supp
s the re
ps and s
to Ir
ry of
Prior
(Shi 'a)
e by tne
Iran s
r) backg
Steps
agraph 6
ited
ort
juve
peci
the
to r
pri
par
hall
roun
to b
se
States sh
(both in g
nation of
al conmuni
price sen
items.
eturii of
soners in Le
ties involved
pursue its e
d for the rel
e taken for t
cond sentence
tart and iopleoent the
and expertise) for Hawks as
ary information (intelligence]
n. Ajid it ( the U.S.) will
and tine taole for the
to Teliran, the question of
anon and the process for their
shall be discussed with Secord .
fforts for the creatiou of
ease of otfker hostages.
he submission of items mentioned
END
T/^lS <i
Partially Declassified/Released nn :? ''>- '^rfi
under provisions ol E 0 12356
by K Johnson, National Security Council
1168
i> r o- ec
f
^A3f*c*-.-. -
1. A New York man whop I haven't seen in scxne years cane
in to tell me that he is currently working for Adran Khashoggi
and is involved in transactions involving Iran.
2. Khashoggi apparently got some Canadian investors to put
$15 million into a company called Lake Resources which was to
acquire goods for shipment to Iran, the Canadians are said to have
put up their money as a loan which was repayable In 30 days. As of
now they have been waiting five months for their money and are very
close to doing something to recover money put up since May 15 without
any collateral or signatures. Credit Suisse in Geneva is in sone
way involved in this. Khashoggi put the group of Canadians together
but feels their panic about their money is such that he will not be
able to. control it for long. He believes that members of the
Canadian group have been talking to Leahy, Cranston and Moynihar.
They are claiming that the latest shipment was SIO million short because
63 pieces were defective and 299 were missing.
3. The final message was that the only way to handle this matter
is to supply the rest of the equipment or agree on a refund of X number
of dollars or repay $10 million.
Allen ex*74
UNCLASSIFIED
^BIpDeclassilied/Released on^i-t^cP
under provisions ol E 0 12356
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1169
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i)HetftSSIFE£9
Objectiyi of th« Proqf:
In the short terw to r«solv« th« AiMrican boitag*
problem in Lebanon, through the offices of Iran, to
include
return of til presently held Aaericsn hostages, and
cessation of hostage-taking;
and to accomplish this without jeopardiring our public
policy of non-negotiation with terrorists and
host age- takers.
Ir thf )C'
t f rr- to 1 1 t i t 1 ; ; >• c c r t a c t r w j t h : r. t h <
• : ^ ■ . c- r ' : ■ - ■ ■ t ' ■ r . c ' • t (. : • t r. c { : : : . I . ] . • , c :
timz.r.z atrj'. a cta'-.ji i r, the regirrc i r. ] r a r (cr
jts attitudes), thereby
er t a t 1 J 5 ^ ! r.c cradualJN- a r a pr : ochre r, ', bctuccr the
U r. 1 t e : S " c t e 5 a -. d I t a r, .
Ult irate. Stratecic 0!:-'ert:ve? re-ain an a 1 1 i a r. : e which
c c r, t c ; r. - ? ' t c .' the S c v j e t U r, J c r. on a crucial f 1 a r t
and preventinc their move tOk-ard the iridcJe east;
counterweight to Arab themes in the Middle
Problems with the Program:
For over a year the US Government -- using private and
Israeli intermediaries -- has tried to resolve the hostage
crisis by treating wijth Iranian officials: the long-term goal
of eventually restoring a strategic relationship has remained
in the background. The principal intersicdiary has been
Ghprbanifar. and the principal official has beenj
In return for the shipment of American arms to Iran,
release of two American hostages was achieved.
mtA^HED
1173
WICEBSSIF^^
ragiF'
I 0139
^
B«c«ufe the Chorb«nif«^^^^K:hann«I, was vi«w«d
flow .nd unreliable, the White^Wf^^ncourased by Seccord
and Hakira — has turned to • new channel. The new channel^
Involves an individual purporting M^^mB^^m^^b^^ <//^,.^^^o/i A
Rafsanjani, Speaker of the Majlis and second most po-erful man
in Iran.
T^a fr,-
The
genu i ne
and his
loug
. _ >s accepted as
is influence with
WMle the -.cne of the fneetings has been generally
r ;::•-:••'• . f.r trrcf.-.-.nc has been touch and the
'■ ' - " . r • . r ' - :.::,•-..;•, c : c 5 j r e r e - a : r. : e ;_'.-. i
cr r.f r c ■
us IS t he" d; rpc c 1 t : cr cf
liar., airi (cr wh.ch he arrar.gtc t r.e financinq,.
Ghorbar.jfar and his creditors, including Adnan
Kh athcc:i, appear dc'ern;nec! tc recoup the::
"losses", ever, a: the r:sk of exposing US c : •. e t
arfT's sh;pTcr.ts in exchange for release of c.r
h : s t a q c ;
^"<? hav^^afes^r 1 ng sere for which no treatn-ert hc_
prescribed ^BHHHi^^^ den-anded that the Ghorbanifar-
iChannel be shut dc
axceady t (
ipproveo of the w;
heretofore. Notwi t hs t and i ng ,
spoken of 'eliminating
f utu re .
Chorbanifar appears to be harassed by his creditors, some of
whom already have brought the problem to the attention of the
DCI and Senators Leahy, Cranston, and Moynihan.
1174
WCtl^WD
Chorbanifar claims to have secreted, for
"insurance purposes', documentation of events
which have transpired so far. | Q "] 9O
Given this, the major elements of this initiative are
likely to be exposed soon unless remedial action is taken.
There is no indication that the White House has a plan to
prevent the exposure or a plan to deal with the potential
exposu re .
The Ghorban 1 f a r
way that contains poten'
hannel must be shut down in a
iraqe to the United States.
When the initiative becar. National Security Ad.'isti
KacFarlane wanted tc establish a channel to factions within the
Iranian Governrrcnt uith which the United State? tnicht
e-er.iually deal, a ^ r' u>.:ch r.cht s^:u:e ; r,c 1 dc r, t a 1 1 > tht
release of the Air.eiica.' hostages in LeLanon.
ae ; 1 cfficialr 1 1 1- e Diviz K: n-i-f r'-*: ^^^ white H-
; c : ~ e c ;
infludinc
- direct link t_o
"^ series of meeti
hichly positive
; •_ • • t c K c ; ." : i '. j a r. c ! : 1 c ; .- . :
■. c r L i r. 1 ; a r also e s t a t 1 1 s h c J a
Prirre Minister's Office. A
"ensued with negotiations sometin-.es appearing
sorr.e times near -disastrous.
One hostage was released in September
result c f this cha r - c 1
i96S . a:
A bteakdoun ocurred m Cere. a, in late Nover.ie:
19£S, when the Iranians accused the other side of
knowingly delivering the wrong version of Hawk
missiles to Tehran -- an accusation we believe and
for which we blame Nimrodi, if not Chobanifar.
Progress appeared dramatic in May 1966 when a US
delegation led by MacFarlane secretly visited Tehran. The
results, however, were disappointing. The Iranians were not
prepared to deal directly with so high level a delegation.
Still, another hostage was released subseguent ly , in late July.
Another channel, potentially more promising, was just
then opening up through private efforts by Albert Hakim and
Dick Seccord. Through a London representative of the Iranian
Government , ^^MM^Bflj^BA a meeting was held in late August in
WVOtASSIfJfg
1175
^NMASSIf^D
Bru«««lg with)
. WTTlnTurnTl^T to two iieetlngs t>«twe«n thT"
T^SJTJr"^ offici.l.. one -eeting In Washington, the "her
Chorbanifar's Alleged Financial Straita:
0191
hniH • "^rl Chorbanifar-^l^channel is technically 'on
nold. Clearly, however, jc is being supplanted by the Hakir
M^P^HBchannel -- a fact reportedly known by ^^^^^ anr)
presumaDly by Ghorbanifar. ■■■^ ^
The ,
".' trc-ractjcns ir, which Ghc rbam i b r er-^l
-'■> -■ c:-i'ce cf ary a t rr s delivery w^.l]e Tehre;
P^eMcusl? burnea tj cthe: would-be arms providers, demanded
shipr.er.t before psy-cr.t. Thus, it fell to middle-fnan
Ghcrbanifar to arrange the financing.
_^ C-^rrtir.if a,_ u^rl-ir.? with Adr.ar. Khashoggi, got some
Caradisr, investors tc lend $15 rr.illion to finance the shipment
Of hauK spare partr tc Iran. Khashoggi put up collateral t c*
^■••' ^' 1' ' f- :• ;^.J ]:-r' 7h« iMc:c:\ or t : - 5 . ' -
" ' . f^ ° •' ^ ~ . '. - r . - c : J . j ■ : T f . t ; c f i n a r. c ; a ; e : r a n g e r t -. ' ' - ■ - 1
r.ict C-, t.^e e-.z c • A,-.. -- te:cre MacFa r 1 a r,e ■ 5 visit tc 7 c.-. : a.-.
Since the loan was agreed to, Ghorbanifar claims to have
beer, paid only $s.m. He agrees that he received $4M at the end
ot July fcllwing the release ct Father Jenco . He claims
without proof, that only $3K can be applied to repayment'cf the
loan, the other $lr being related to a separate transacticr
_j-Xt_hjg^J^JJg Gr.;rtanifar ad.^.ts to receivmc Sbf tw- or
tnree wee^s later, but that no additional funds have beer,
f c r t hcor 1 ng .
He states he has been able to repay about $8M to
his creditors, including $6M to one financier --
of which $1M was interest.
He states, too, that he paid other financiers $2M
for interest charged.
Ghorbanifar asserts that he now has a $10-$11 million
shortfall that he cannot meet. The creditors are becoming
angry and have demanded additional interest because the
principal is overdue. Ghorbanifar claims to be under
tremendous pressure and feels financially discredited.
ifiiD
1176
ussfFt:
J
Ghorbanif «r '^^ financial lituation is aurky,
indeed. jMHH| ^'s claiaed that h« paid'
Ghorbanif^^ai^addi tional $aM in cash, an
assertion that cannot be validated.
Regardless of who is cheating whom -- and we are not
likely to be able to sort out these confused finances -- we
face a situation where operational security has been forgotten
and no one is prepared to deal with the issue.
019
Rapprochment with Iran
c c ! : ( c t :
t A- .. I i c i
: _ 1 ir.i , ;'.•.
1 r. t c U. €
factious gc ve f ruren i of Iran.
for example, ha;
atri supply.
Wc have r.ct yet deve^cpei a v:atle pi
fo cussed or Icr, c-terr
c f act ;c'
^
[?
"hanne 1 :
C^.c^i:a.-. .far is depressed and clairrs his financial
situation has been dar.aged. On several occasions, he has sa:d
he w:i.lc nc * sit idl) ty and pe r r . t hirrself to be rr, ade the
'fall gu>" ir. th:s r;tter. he clairrs tc have giverj writte'
accounts of all that has transpired to several persons in
Ar^erica and Europe. He has directed these individuals tc rrake
this material available to the press in the event that
something bad* befalls him. We believe this account would
include statements to the effect that:
the Government of the United States sold military
materiel to the Government of Iran in order to
gain the' release of American hostages in Lebanon;
a high-ranking US delegation met in Tehran with
representatives of the Iranian governinent in order
to discuss the future relations between the two
countries, with various cooperative ventures
discussed ;
ilNetASSfFFED
1177
W*CtASSIRED
the US Government made several promises to him
(Ghorbanifsr) that it failed to keep; and,
the Government of the United States, alpnq with~~\
the Government of Israel, acquired a substantial )
profit from these transactions, some of which
profit was redistributed to other projects of the'
US and of Israel. . !
There is a I so likely to be rraterial alleging poor judgerrent anri
shabby conduct by individuals of the US and Israeli gove r nrre n c ^
I 0195
i^t. tacc a d i s 6 s t e : cf tr i ■ ■: : f : : - ^ : t. j or, : :n our eii oil:
with Iran 6ezpi.te the apparent prorise c: the HaJ'.im-
char.nel. Tec irar.y know too njch. ard exposure, at a"
<'- :\c da-}~- '.^r r,^, cr, c-''^l r- :--:■■ . f--rLa;r f a '. a 11 >
Rafsanjani can rot perrrit h.rself to be zeer. a?
d££;:nc directly - i t h t ^ t "Great Satar"
i£ clear i : c r m^^^^^^m s cor^-^riis t r. .
not have total co^^^^^^^Pr the Lebanese Shia
holdinc the American hostaces.
Because the risk of exposure is growing daily
lie wine acticrr are reccT.-o- :jc;
the
(A; Estatlis!- a Sen;c:-L€
f .
.no Ce 1
at I n e -^ ;
l^'c^se tc focus cr the pote'tic! for rapprochnent wlt^ Iran, t r.
appropriate channels to be used, and the separation of the
tactical hostage issue from the long-term strategic objective.
This group could consist of two or three experts and
should be headed by sor-.eone with the stature of a Henry
Kissinger, a Hal Sauders, a Don Rumsfeld, or a Dick
He 1ms .
The group should have access to all data concerning the
onqoi no i n 1 1 i^t i ve ( s^) , inr 1 uri i nn White House records^^B
UtteifliSStRid
1178
«#«^LASSfFlH3
(B) Develop Press Guidance In the Event of an Ejiposurg.
We have no coordinated press guidance on how to deal with the
Iranian initiative should it be exposed publicly. Press
guidance must be prepared now. At least one, possibly two
major US journalists have bits and pieces of the hostage story
and know that Ghorbanifar was involved in it.
The Israelis have exposed some of this.
Khashoggi and the Canadian financiers are
complaining to influential US individuals.
.-■.•-
1
c
(C)
e;
:1
r Crde.'jv.
r =- 3CC- 1 :
1 - ■ 1
> I r c S h u t d 0 w n
c
r. - - :
; ■. It ^ '
• ■ . ; - « c - ^ ! d
t
0194
discredit a n^>"
d c c u rTi? n t a r V e v i d e r, c e
Dy Gr.c : Den : ( a : ,
ir>flicates L5 o
he hcs tec r,•JC^l
f J c 1 a 1 s .
;■::.'. a ;" : - e c r • e r. ; a ; -_- G r. c [ t i- ; ; : c : _ c "; ". e i w . : •_ , ; :
rcn-hcrtage-related projects -- say, in the a : e a
of Iranian, Libyan, and Syrian sponsored terrcrisr.
A s r a 1 i w o r king g : c ;
Ghcrbar. 1 (
those kncwlecgeabie of the
r.-el should rreet to ccrsider he
CJearJy. t.>-6:£ ar€ zz~e perscr
f c : G ".■:.' t i '. f a ; , : c : er arr^ la
Arrange perrr.anent a i i er. residency for his girl
friend in California.
Arrange for visas for his farr. ily so they can visit
relations in the United States, and so his mother
can obtain medical treatment here.
These steps will not •alleviate Ghorbani f a r ' s financial problems
-- regardless of their merit -- but may dispose him more kindly
to the US Government and lessen his inclination to expose the
Iranian initiative.
Wet"ASJfFf£D
1179
/4 Cd^c.
UNCLASSIFiED
3^cz;
fC«u«;
nr
^^*tjV
(^IN ^'^SS
Declassified/Released m3_feH 9SK
under provisions o( E 0 12356 ~
by KJoNnson, National Secunly Council
«WCI/ISS/F?£0
Allen E/77
1180
TV WrtslorrfCoiirjl Inidlittna jdiL-si^r- -^H C
17 October 1986
Nsiional Inlclligcnce Council
M£>10RANDUM POR: Director of Central Intelligence
Deputy Director of Central Intelligence
I 0 198
FROM: Charles E. Allen
National Intelligence Officer for Counterterrorism
SUBJECT:
Ghobanifar(
• Channel
1. My meeting yesterday with RovL-tL Furmark. New York representative of
Adnan KhasrK)ggi , only served to underscore the serious concerns that I
outlined to you in my me.-norandmn of 14 October. Indisputedly, we must
endeavor to^ffect an orderly, damage-limitmc shutdown of the
aiobanifar^B^HM| channel now before serious — perhaps* irrevocable — damage is
done to cui^^^rmtiatives to free American hostages in Lebanon and to '
establish links with moderate factions in the Iranian Government.
2. Furr.i:K, ;
following points:
trief conversation uitl-
c- 16 October, rrade the
— He has kno^nttliobanifar since January 1985 and has detaile^ knowledge of
the C^obanifarlH^^^^^tnannel (although he never mentionedfl^H^f^ Dy
name). ^^^^^^^ ^^^^^^
— He has met with Ghobanifar many times and participated in discussions in
the sumer of 1985 on the need for rapprochement between the US and Iran.
He acknc^.■ledged that rapprochement was not just a national security issue,
but that he, Ghobanifar, Khashoggi, and others saw a potentially lucrative
market if relations were reestablished between Tehran and Washington.
—Thf '^''^ '^^ prnviriinq Iran with milir^ry pginptnenf in e^rh.ir>QP for
American hostages — ^f^p ds ^ '^y "^ f-urrnf-nn nr; a Hi;<loque with Iran — al.<;o
nrTgThorrti in thr nurmr"- qf ^^85 and he along with Ghnt->arii far . travelpd to
•Tel Aviy.xD August 1985 wIiptp t-h^y mp^ wl^h A niimi-rfT of I.«:rapli officials
including _AiTuran Nir, Israeli Sp>ecial Assistant to the Prime Minister for
C5n£atting Terrorism. Subsequently, arfns were delivered to Tehran in
Segs^absii— W^St- a development that resulted in the release of Reverend
Benjamin Weir.
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— After a number of false starts in late 1985 and earlf 1986, Khashoggi
agreed to finance anotlier arms transaction in May 199^ just prior to Bud
fidcfarlane's secret visit to Tehran. He borrowed money from a nuntoer of
Canadian finaixriers. On the basis of a signature loan, he borrowed a
total of $15 million at 20 percent, agreeing to repay principal, and
interest in 30 days. Everyone anticipated that the MacFarlane visit would
result in resolution of the hostage crisis.
— Unfortunately, this did not occur, and only $8 million has been paid by
tlie Iranians for the equipment received. Of this, $5 million has been
used to pay back one creditor; the refraining $3 million has been used to '',
cover expenses and for other matters. No profit has i been rteiahepd, and
Kiiashoqgi owes the Canadians $10 million. U I 7 7
--T^iL- cur.'onc financing was cor^licated by the fact, tr.at Iranian officials
in the FriiD'T ^ir.ir'.er's Office conplaineG about the price of the Hawk
spare parts that were shipped, asserting that the cost was five or six
times wnat should have been charged. Many of the delivered items,
moreover, did not work or were for a different model of the Hawk missile
systeir. .
--Iranian officials, after having paid $8 million in cash, claim that no
additional funds are o-ed to Qiobanifar or Khashoggi. Tlie shipment of the
lijwk spare ports to Ter.ran, however, resulted in the release of fatner
J. FL.-r-.i.'K sia-.Tci tiu-.: ine current situation has left G.-'.oljanifa: a-.:.
.-..'lasiioygi witri $1U million of indebtedness and no prospects for resolving tr..c
indebtedness. According to Furmark, Ghobanifar and, by virtue of his
financial involvemeet in the scheme, Khashoggi, are being blamed Ijy th$
Cinadia.-i creditors for this situatior.. The Canadian entrepreneurs, who have
investnK?nts in oil, gold, mining, and real estate, reportedly are aggressive,
tough-nnded individuals who have influential contacts in liashington. They
iiave told Khashoggi that unless some payrnent on the principal is forthcoming,
choy would begin to inform individuals like Senators Leahy, Moynihan, and
Crnnston around 13 October about this back-channel deal with Iran and how they
hove bee/1 swindled. Furmark, while stating that he was not authorized to >,
provide tne names of the Canadian investors, asserted that we should not S
iinderer.tiMiote the determination of the Canadians. He claimed they have a
reputation for dealing roughly with those who do not meet their obligations.
r:hashoy<ji allegedly is trying to get them to extend the 15 October deadline,
but wos uncertain as to whether he would be successful in this effort.
4. Furmark stated that he spent two days last week in London talking to
Qiobanifar. lie stated that Qiobanifar is telling the truth about these
transactions and insisted that the Iranian entrepreneur had not made any
profit off this deal, lie stated that Qiobanifar was in a "devastated"
condition without any constructive ideas on how to pull himself out of his
current financial morass. Khaslioggi, who also has financial problems, is not
in a position tb repay the Canadian creditors. Furmark stated that he had
worked for nnny years in the oil business and was a good judge of individuals
who wc-re attempt ing o swindle. In this case--regardless of other Ghobanifar
business dcals--he was convinced that the Iranian was essentially telling the
truth.
^NCLASSIFSED
1182
uftcmsrnEB
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5. Furnark stated that everyone had agreed to keep this back-channel
arrangement with Iran 'highly secret* but that if the situation remained
static, he is absolutely certain that the Canadians will talk and that the
matter will eventually become public knowledge. He recorriended that the US
consider at least a partial shipment of additional arms to Iran in order to
maintain some credibility with the Iranians in the Prime Minister's Office and
to provide Ghobanifar with some capital so that the investors can be repaid
partially and so that Qiobanifar can borrow money to finance additional
shipments. TJiis would keep the process rolling and could result in release of
additional hostages. Furmark offered to meet with me in New York next week in
order to report fully on his involvement in these transactions. r\r^r\r\
6. Coninen^J^ find Furnark's detailed knowledge of the
GhobanifarSjjj^^^^ link deeply troubling. Regardless of who is at fault on
the financing — and we know r.hat Ghobanifar is not to be trusted — the exposure
of these back-channel ceaiincc will almost certainly have a crippling effect
•on the new channel thit har now been op:-ned between the United States and|^H|^
Tlie risk of exposure is growing daily,
I ^ain believe that you must advise AdmiralRpindexter that a group be
formed that is knowledgeable of the Ghobanifar^BfcBM| channel to consider
how to cope with th:s burgeoning prooie'-. If this is not done iimediately, I
predict an exposure of this activity in the near future. At a minimum, we
;o find ways to stave off disclosure for 60-90 days while we work the '
rhannel tactically to get our hostages released. Furmark showed he
TTcaTior: that he -cc awirc- of the- ne- c'..-inne!, tjt we kno- a-.ot.anifar ; =
larles E. Allen
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ME210RANDUM FXDR: Vice Admiral John M. Poindexter, USN
Assistant to the President for
National Security Affairs
SUBJECT: Roy Furmark's Comments on the Hostage Situation
I 0195
1. Charles Allen and George Cave went to New York on 22 October 1986 to
meet with Roy Funnark. This was an extremely interesting meeting in that it
revealed that the financial backers of Qiobanifar have been aware of the
operation since its inception and may actually have played a key role in
getting it moving, possibly for altruistic reasons, but almost certainly f,ot
their own profit. Roy himself admitted several times during the evening that
profit was certainly a motive but that the group did see their efforts as
leading towards stability in the region and the release of the hostages. Roy
appeared to be very open during the course of the evening and everything he
told us tracked with what we know. Ihe only doubtful answer he gave was in
y reply to a question as to whether some of the principals were involved in the
sting operation. Roy said that none of the principals were involved, however,
one of the players, lawyer Samuel Evans, was the major indictee and is free on
$4.5 million bond. Roy claims that Evans owes him $200,000.
2. Khashoggi has been involved in this from the beginning as Qiobanifar 's
financier. Everything started in January 1985 with a meeting in Europe,
Frankfurt apparently, involving Qiobanifar, Khashoggi, Roy, and others. Ihis
was followed up by subsequent meetings in Paris and London. These meetings
culminated in a meeting in August 1985 in Tel Aviv. Roy went to Tel Aviv with
Qiobanifar and while there they stayed vith Jjintfodi in his house, ftiring the
course of these meetings, Roy met Amiran Nir. At this meeting it was decided
that it was necessary to get Washington's approval for the overall plan,
•mere were two basic objectives; one, get release of the hostages, and two
open up a dialogue with Iran. Schimner was sent to Washington to obtain this
approval. Roy is uncertain as to whether he discussed this with North or
MacFarlane in Washington. Qiobanifar also made a total of four trips to
Washington. Qiobanifar represents the line held by the Prime Minister which
Roy describes as 'Moderate.' (We did not tell him that the Prime Minister
could not be considered as Moderate.) By way of personal relationships, Roy
TS 3536-86
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said that he has known Khashoggi since 1966 and trusted him. Roy added that
SchiJmKr and Khashoggi are close. Roy thinks this points up Khashoggi 's
breadth of vision. Roy pointed out that Schiitmer had actually returned from a
visit to China to nake the August meeting.
3. Bie first transaction was in September 1985 and was for 500 TOWs. The
cost of the TOWs was $5 million. Khashoggi put up the money because he
believes in Ghobanifar. The cost to Iran was $6 million. This allowed for $1
million to cover profit and expenses. The first shipment of TOWs was
defective, so a second shipment was sent. There was a subsequent $5 million
deal that went off in the November-December timeframe. Khashoggi told Roy
that they were not involved, but Roy is certain that this was. a n 1 Q ^
Khashoggi/Ghobanifar organized deal. 1 U 1 -^ D
A. Roy said that prior to the next deal, there was a meeting in the Pans
airport hotel; he forgets or never knew exactly who was involved in this
meeting. The meeting concerned Hawk spare parts. The deal for the Hawk spare
parts began to be put together in April 1986. Khashoggi raised $15 million to
cover the deal $5 million from an Arab financier, and $10 million from two
Canadians. Khashoggi raised the money on 15 May. A group of Americans went
to Tehran and took with them seven percent of the Hawk spare parts which '
consisted mainly of nuts and bolts, with regard to this deal, the financiers,
Qiobanifar, and Nir met and agreed that $3 million would be added to the price
to cover profit and expenses and also another $2million would be added to
cover monies owed to Nir. The price to the Iranians would then be $20
million. (Why did Ghobanifar charge $24.5 million and with Nir's knowledge?)
Neither Roy nor the financiers apparently know anything about the raise in the
price by Ghobanifar, although they are aware that the Iranians objected
strenuously to the price. Ghobanifar told Roy and Khashoggi that he believed
the bulk of the original $15 million price tag was eannarked for Central
America. In this regard, Ghobanifar told Rby that he was relieved when the
$100 million aid to the Contras was passed by Congress.
5. The above requires clarification. In Tehran, Ghobanifar took Cave
aside and told him that the Iranians would be questioning him about the price
of the Hawk spare parts. Ghobanifar told Cave to insist that the price of $24
million old dollars is correct. When asked about the huge jack up in price,
Nir gave a long circumlocution on why the price of over $24 million was
correct. We were so concerned about this that we considered telling
Ghobanifar exactly how much he could charge on any subsequent deals. From
Roy's coiments, it is clear that the .2fl_Bercent interest Ghobanifar told us
about is in fact the gross profit margin agreed upon.
6. Roy said that Ghobanifar told them that he received two payments, one
for $3 million and the other for $5 million. As originally agreed upon, the
Arab investor was supposed to get back $6 million for his cut and the
Canadians would get back $11 million. The other $1 million was to go to
Khashoggi. Qiobanifar's cut was to come out of the $1 million. To the $8
million that Ghobanifar received, he added $100,000 of his own funds. The
Arab investor was pajd off ($5 million). The two Canadians received $1.1
million. Roy was not sure but presumably the $2 million went to Njr.
UNCLASSiF^
1214
UNCi«€SIF3ED
I 0197
Originally, the Canadians were given a check by Khashoggi in the amount of $11
million to cover the $10 million they provided Khashoggi. Ihe monies to cover
the Hawk shiptnent were paid into an account of a company called Lakeside which
is an off-channel cotrpany. Ihe Canadians believe that the money was stolen
and this is giving Khashoggi heartburn. (Note: This does not square with
what we know. We know that Ghobanifar received $A million from the Iranians
in July. He also received $8 million into his Swiss bank account on
21 August. These two payments were cash. He may also have received a check
for $6 million in between these two payments. The Iranians raised a big stink
about the price of the Hawk spa*«^^t^and Ghobanifar offered them a $6
million deduction. According t4^fH^^^ the $8 million payment on
21 August scuareij'\t-'"'eir accounts with Giooa'',ifcr by mutual agreement. In
fact, according ^°^HflH||^ ^^ million covered the remainder of the deal, tr,^
other million was t^T^^Griobanifar finance the next deal.)
7. Roy's suggested solution to the problem js to let Ghobanifar handle
the shipment of the remainder of the Hawk spare parts. Proceeds from this -
deal would allow them to ease the Canadian pressure. Then it would be 500
TOWS for one hostage and another 500 TCWs for a second hostage.
Sincerely,
Willian ,J. Casey
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7 Noventoer 1986
of central Intelligence
Dicectoc of Central Intelligence
Oiarles E. Allen
National Intelligence Officer for CDunterterrorism
Meeting with Roy M. Furmark
oggi's New York operations, called
ting with me in Washington. I met
the Key Bridge Marriott Hotel. He
that is occurring with the
The following are highlights of
1. Roy M. Funnark, head of Adnan
on 5 NoveiTt>er 1966 to request An u
wi th Roy on the afternoon of 6 Novi
provided further information on the f
shutdown of the Qiobanifa
the conversation with Roy
a. The Canadian investors whcflg^p $11 million to finance the arms
transactions with Iran have retain^^Bft'dshington law firm to bring suit
against Khashoogi and the offshor^^^Kny Lakeside, the firm into which
they paid the $11 million to coverSH^st of Itawk missile parts, the
Canadians told Roy that they wouldoHng suit against Khashoggi and
Lakeside on Monday, 10 November, and that they intended to implicate in
the ligitation directly senior levels of the US Government. Roy claimed,
however, that the Canadians had agreed — at his request — to withhold filing
the suit until 17 November.
b. After the release of Jacobson, the Canadian^ began to press
OHSbanifar and Khashoggi for repayment of the moneyi^^ed. QjQt^oifar told
the Canadians that the latest transaction did not involve hj
and that the United States was 'dealing direct* witn the Ic
Government.
c. The Canadians tend to believe (Jiobanifar becai
their lawyers block Qiobanifar's account in Ctedit^^iss
been transferred into Qiobanifar's account iri**^yinent
to. Iran, Credit Suisse would have autonatiotftly transf
the Canadians' account in the Bank of Montreal
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ians are extremely angry, they are pressing Khashoggi
"^slieve that the Iranian Government has paid money to
af additional arms having been sent to Iran. They
hat Jac^^^^ release could only have resulted from another anns
Pction wit^^^^
The Canadians involved are tXxjglas Fraser, a financier who
tes out of l^^^yman Islands, and Ed Miller, who operates out of
and VanJMBT. The third individual Involved in the investment
ay could not remember Jiis name) who lives in Los
Ang^^MBB^ffl^^y. The swami knows a number of prominent Congressmen
,(Cra7i^n|^2'^'^i°"*'^' ^""^ ®v®" advises the Sultan of Brunei. The swami
his counseled Fraser and Miller to be patient, but the two Canadians are
now determined to recover their money.
f. the Canadians intend to expose fully the US Government's role in
the backchannel arms transactions with Iran. They believe lakeside to be
a proprietary of the US Government; they know that former Major General
Richard Seccord is heavily involved in managing the arms transactions to
Iran for Oliver L. North, and tha^^a^rd is also involved in assisting
North in the support the Oontras ^^^aragua.
' g. When the Canadians origin
with Khashoggi and Ghobanifar, th
sanctioned by the US Government,
politics of the US-Iranian equati
tnillion. Miller, a tough and sle
to get his money back.
t up the money after negotiations
ieved the effort was fomally
re not concerned about the
y simply want repayment of $10
ividual, is especially determined
h. In addition to bringing si^^^feinst Lakeside and Khashoggi and
exposing US Government involvemen^H^e arms transactions, the Canadians
intend to use the swami to lobby key Congressmen. The Canadians believe
that they have been swindled and that the money paid by Iran for the arms
may have been siphoned off to support the Contras in Nicaragua. The
Canadians originally expected to be repaid in thirty days; it has now been
six months and they have received only $1.1 million.
i. While Ghobanifar managed the channel to T^ran, he coordinated his
Initiatives in a variety of ways with all significant factions in Irem.
Qearly, whoever is ruxming the new channel has f^led to
devastating mistake. '
2. Roy stated that he would endeavor to identify the
Canadians have retained and would call me on 7 November. It
understanding that the law firm in question at one time hadj
involving President Nixon. The Canadians have told Khashc
already lost $6 million as a result of their ill-fated
part, Khashoggi is demoralized and is unable to correct
his own financial difficulties. Qiobanifar, according
sums of his cwn personal fortune over the past 18 months
described Ghobanifar as an excellent broker with extraorSWWRly high-
contacts in Western Europe, the Middle East, and Iran. Ghobanifar, however,
is angry and bitter and his health is now impaired.
.(L\\>) 3'\'\5
^N0(:ASSfFfEd
[mutwtetistrr/'^ 7*^ ^
1230
/
uHcassiE^.
specific suggestions on how to solve the financial
^sotnehow $10 million should be paid into Ghobanifar's
^^^UAccount Nunt)er 283838-92-1). Because Qxjbanifar's
cedit S^^^Bs totally blocked, the money would simply be
to the Canadians. All the Canadians have are checks from
and Khashoggi — checks that are worthless. Roy reaffirmed that
and Khashoggi have been able to pay off the other investor— an Arab
^$5 millionafiBy stated that he and IQiashoggi nay see the Canadians
the nej^^^Ere to request more time, but they were not sanguine
It from such a meetlngr
4. iTC^^^^^E^iave told Roy that they had kept their word keeping
these transactions totally secret, but now felt no con^iunction to do so in the
future in view of media exposure of the HacFarlane trip. Roy stated that he
personally felt responsible for persuading Khashoggi to help finance these
transactions, the effort had taken considerable courage both on- the part of
both Oiobanifar and Khashoggi. In Roy's opinion if the transactions had
proceeded as planned in July 1986, the hostage issue would have been resolved
by nowl The apparent switching to another channel by the United States in
dealing with the Iranian Government, h
current publicity about these transact
near-^term hope of obtaining Iran's suj
additional hostages. The danage that
the Canadians is potentially significai
aware! of all of the transactions that
months.
I
6. ; I conclude from Roy's statemen
a. Purmark is personally troul
capital foe a venture that has now
, had destroyed this process. The
robably has foreclosed any
n securing the release of
cur from the legal efforts of
ially because the Canadians are
rred over the past 14 to 15
having persuaded Adnan to put up
b. His approach to the US Government appears to be a last-ditch
effort to try to pressure the government to take some action, for example,
ensuring another shipment of arms through Ghobanifar.
. c. Some very nasty allegations against the US Qpvernment and key
officials will be made if the Canadians bring civil suit, although much of
what they know is speculation and cannot be proven. I
i
d. The fallout from any litigation by the Canadians ma
significant, especially since the press already have major
back channel effort with Iran.
le. When dealing with Iran, every faction — to some
taken into account. The fact that Oiobanifar kept AyatoJ
fully informed on his initiatives with the United Stateq
radicals around Montazeri have decided to use the MacFa
contacts by Iranians with the United States as a way
Rafsanjani's moderate faction. <3iobanifar, bitter an^
actually encouraged radical elements to expose those contacts, although
the 'arrest of Hehdi Hashemi probably finally triggered the action by the
radi,cals.
Ci\ii y^is
UmASSM»>
futirtiii Ityrti] 1 11 17
1231
lHieL^$(F}E&'
the situation is messy and is likely to become even
keep in some perspective the damage that can be caused
balance, given the curcent exposure, the dcuiage now
t.
Qiarles E. Allen
(JJllU 3S15
1232
UWetftSSfFItD
2 ^^^ ?'
NIC 05060-66
3 NoveiTt)er 1986
: Director of Central Intelligence
Wlen
Intelligence Officer for Counterterrorism
Hilt! 'M^
nkfurt Meetings
Bud MacFar lane's trip is becomi
visit. The problem steins from the ra<
They have convinced ^jm that this was
turns out that Qiobanifar told Montazal
hjjn briefed on what is going on. It t|
have been friends for 15 years,
the Bud trip were several. One was thj
cooidinated at the senior level. One
presence in Tehrai^n^the role he plaj
he has convinced ^B^^B that he has
States. imUpia^^lot of faith.
Amiran Nir's presence in Tehran,
cover his backside. Hi^^^lAargued t1
mi|^|Hasked~him about Bud's
cals around Montazari taking action.
Iran. Interestingly enough, it
t all the transactions and kept
t that Ghobanifar and Montazari
t the reasons for the failure of
trip had not been fully
problems was Ghobanifar 's
St people do not trust hijti, but
influence in the United
ifar. The other problem was
d them who he was in order to
ice QiobanifarJ
given to believe that Ghobanifar was quite a powerful man. With
further regard to Cliobanifar and his threats, Bafsanjani has proposed inviting
him back to Iran and keep him there several months working on things. The^^
can keep him based on the fact that there is an order for his execution. |^^|
said that they do owe Ghobanifar $10 million, but he also owes them 1,000
TOWs. The problem for us is that he has been involved in many deals and we do
not knew how to judge this statement.
CL BYl
DECL
Cum 4030
UNetft$StF!kD
[letiT:'.-! atfjtrr
"jf-aiiy Declassified/Released on_i_£V2 fC}
under provisions ot E 0 52356
1\- K jonnson Njiional Secwity Council
1233
uinn.AssiF:ED
I
3. OHJe North said that since the beqintmigof the talks we have taken
certain po^^ical actions, we have talked to^^[|and pressured them into
curtailM^H^fe^^^s to Iraq. We have opened discussions with the^m^H^
[said that there were four issues that he wishe
1, but first he wanted to say that Khomeini has
;h he states his considered opinion that the hostages
^s changed the attitude of the Lebanese captors. J^|B
lat they wish to table the following points for discussion:
;eed with our relations, and relations with other states
rrive at a ]oint understanding as to why things are
C. He wants to explain and clarify his own role in the operation.
0. He wants both sides to engage in an analysis of the security of
the operation.
better
on our sioe we explained the
In this instance we stated
I we were moving as fast as possible
lid that he has full trust in the
Dlain the problem of coordinating
^t understand that this is a new
it is like a corporation. There
fing is the fanatic wing (Ttondro) .
toups, one of which is extremely
The second group is the Middle
Roaders. Rafsanjani is the leader of the Middle Roaders. This group
functions as the bridge between the fanatic group and the right wing group.
The right wing group leans towards the West in the sense that they want free
trade and a democratic government. What mast be understood is that all three
groups are strongly Islamic and want an Islamic government although all three
approach this differently.
US position in seeking
that with regard to the 9-point
and they must also move fast, too.
group he is dealing with and wants
things in the Iranian Government.
revolutionary government. After
are three wings in the government.
This wing is actually divided into
fanatic and the other which is less so.
5.|^msaid to understand the government process, we mij
Khomeini has given to Pafsanjani the responsibility for mar
foreign affairs. This is why he is usually referred to as^
man. WhehU^^^^ first brought up the issue of better
US, Rafsanjani agreed, but said that all groups musttake
^^^^a^i^mmm^a^t^^^^^^mm^m Hafsan]ani insisted that
all three groups should take part in this program. Aft
in the Ccibinet and also the Ha]lis, a position was rea«
took it up with the Imam who gave his approval. Rafs^
.that
war and
two
th the
(LUAJ ^30
UNCyiSSIFiED
[iforiitt fcfft^^
i'lllS
1234
UNati^StF^ED
1
if the policy succeeds, all will share. On the same hand if it fails, all
will also share so no one can coirplain. TVie problem is one of coordination
between t^^|^^£ groupsJBBstated that the last shipment of TWs
eiimin^^^^^^^BH^^^^^channel and establishes his group. Hsaid
that^^^^PP^^^^Kior^Jas very well received in Tehran, lyiis enables
the^^^Kce the^^^fct to focus on the hostage situation. There is,
hov^^^^some conf Rr^F) n Tehran.
^^^^^^^^^ This
radical, and united. TViey published a newspaper in which
the United States and Iran are cooperating in getting the
HHsaid that at the mcunent they have no hard information
other two hostages, but he suspects that it could be this
group
8. In one of his many asides to Clarke, ^H said
about North's demand for release of all the hostages.
CUA140-O liNetflSSIfJED
^would be arriving in Europe on 31 October.
sai
hos
Kuwait
want to move things along and hope that the release of twolnoFe
all help. The perception in Tehran is ttat the American leadership
fqs along too fast. They interpreted our original
:ration of extreme caution. The US side defended this
lat the bottom line is that they released two then
several points he wanted to discuss as follows :^^^
>ras for RF-4's, and a list of Fhoenix spare parts. ^^^P
said that the Iranians have 70 Phoenix missiles which are inoperable and in^^
need of spare parts. Rafsanjani hunself is personally interested in the
Phoenix problem. This is because the Iraqis have enormous respect for the
Ihoenix. They need help to repair the missiles on hand as they know it is
iirpossible to obtain new ones. T\echnicians to help on the Fhoenix missiles
would be seen as a very^os^ive step in Tehran and could well resolve the
whole hostage problem. B^BJ^tlsQ said that they have enough TONs for
lasized tha^he sending of things
. We toldHpFthat it might be
nical suppor^they needed, but we
r orders for spare parts do not make
lat it someone were to get into their
large nunt>ers of spares that they do
f we could do anything alxxit the 20
for three years. The FBI is also
t for and won the case. We asked
and some documentary support so
current operations.. At this point
to them have proved the US' good in
some tune before we could organize
thought such support was essential
sense. In fact General Secord beli
logistics system he could probably
not even know they have. j|Halso
Qiinooks that have been embargoed i
holding $20 million that Iran went
him for additional information on t
that we can follow it up.
10. In another aside, ^^stated to Clarke that they feel they must have
pilotless drones to give them the kind of intelligence coverage they need. He
wondere^if they could buy some from the Israelis. This may be an openingf^
N^^I^Bblso told us about^mm^B radars they are buying from^H^H
HH^Hr Although they are suppose^^w deployed to cover the Soviet Union,
iiwac^the technicians are installing them along the Iraqi border.
11
oversee
itheRrc
id that a four-man comnittee has been formed
relations with the United States. They are asj
to
1236
UN0fc^SlfcED
• : : 3
an^they ultimately want, to meet with senior US officials is
and » moderate. He is''(
"in this is somewhat foggy. ^_^
is the only one of the four that knows of his rolfc- Ihe best way to descrit
him is that he is Rafsanjani's window on the operation.
Charles E. Allen
(^nN ^20
UNetASSIFSED
1237
UNCLASSlFf)
^ C /jc^ (f (^
C^J^ ^O ^9i/^^
Ld. J^<ij >§a^
T^'C^ f^CCO^^
C^-^<^eu^t<^^
ewM^ti-^i
UNCLRSSIF:ii3
""".ai'v Oeclassified/Released on ^rj^^f^ft
■'"def Dfovisions ol E 0 J2356
-■ « Jor ison NaiKjnal Security Council
1238
UNCLASSUeIHt'
Stenographic Transcript of hsis ££3: /hi
HEARINGS
Before the
SELECT COMMITTEE ON SECRET MILITARY ASSISTANCE
TO IRAN AND THE NICARAGUAN OPPOSITION
UNITED STATES SENATE
TESTIMONY OF CRESENCIO ARCOS
Monday, May 11, 1987
Washington. D.C.
UNCUfiSIHfD
COPY NO. . ' r^^OP J CCF'ES
Released oft. <l - -K ' ^^/ALDEBSQN PE?CRTiNG
under provisions cf LO. 12356
by D. Sirlio, National Security CouiKil (202) 628-9300
20 F STREET, N.W.
WASHINGTON, U. C. 2000]
1239
(iNcussm
1 DEPOSITION OF CRESENCIO ARCOS
2 Monday, May 11, 1987
3 United States Senate
4 Select Committee on Secret
5 Military Assistance to Iran
6 and the Nicaraguan Resistance
7 Washington, D.C.
8 Deposition of CRESENCIO ARCOS, a witness
9 herein, called for examination by counsel for the
10 Committee, pursuant to notice, the witness being duly
11 sworn by SUSAN A. HARRIS, a Notary Public in and for the
12 District of Columbia, at the offices of the Committee,,
13 ninth floor. Hart Senate Office Building, Washington,
14 D.C, at 4:07 p.m. on Monday, May 11, 1987, and the
15 proceedings being taken down by Stenomask by SUSAN A.
16 HARRIS and transcribed under her direction.
MASSIFIED
1240
UN(y$SIFI[D
1 APPEARANCES :
2 On behalf of the Senate Select Committee:
3 TERRY SMILJANICH, Esq.
4 Associate Counsel
5 901 Hart Senate Office Building
6 Washington, D.C. 20510
7
8 On behalf of the House Select Committee on Covert
9 Arms Transactions with Iran:
10 MIKE J^ANDUSEN, Esq.
11 CHRIS KOJM, Esq.
12 Associate Staff
13 House Select Committee
14 Washington, D.C.
imSSIFIED
1241
UNOUSSIHED
1 PROCEEDINGS
2 Whereupon,
3 CRESENCIO ARCOS
4 was called as a witness by counsel for the Senate Select
5 Committee and, having been first duly sworn, was examined
6 and testified as follows:
7 EXAMINATION
8 BY MR. SMILJANICH:
9 Q This is a deposition being taken by the Senate
10 Select Committee on Secret Transactions with Iran and the
11 Nicaraguan Opposition. Also present are two associate
12 staff with the House Select Committee.
13 And Mr. Arcos, I will be asking you a series
14 of questions. If there's anything I ask you that you
15 don't understand, please just tell me that you don't
16 understand my question and I'll be happy to rephrase it.
17 First of all, state your full name for the
18 record?
19 A Cresencio S. Arcos, Junior, is my full name.
20 Q And you are a career officer of the USIA, is
21 that correct?
22 A I'm a career foreign service officer with the
23 U.S. Information Agency.
24 Q And when did you first become a career foreign
25 service officer?
^ ,M.i£^ miASSIFIED
1242
UNCLASSIFIED
1 A January 1973.
2 Q And you are fluent in Spanish?
3 A I am.
4 Q What is your current title?
5 A I am deputy coordinator for public diplomacy
6 for Latin America and the Caribbean at the U.S.
7 Department of State. I'm on detail f r<Mr the 'T^IR ^to the
8 Department.
9 Q How long have you held the position of deputy
10 coordinator there?
11 A I have been there since last — officially,"
12 since last August, 1986.
13 Q And just prior to that, what was your title or
14 position?
15 A Before that I was deputy director for the
16 Departme»t_a^^g^^ s Nicaraguan Humanitarian Assistance
17 Office. I was there exactly one year.
18 Q You mean August of '85 to August of '86?
19 A It was September 1st until August, the end of
2 0 August, the 31st.
21 Q And throughout this deposition, I will be
22 referring to that organization, NHAO. The way I usually
23 refer to it is "Know-How." I've heard it referred to as
24 "No-Ho," "Now-How," "New-Who," all kinds of different
25 acronyms.
mmm
1243
inssinED
1 But I'll just refer to it as "Know-How," and
2 when I say "Know-How" in this deposition what I am saying
3 is NHAO.
4 What were your duties as deputy director of
5 NHAO?
6 A My duties as deputy director, for one, was to
C4or3
7 substitute the Ambassador, Ambassador Duemling, who is
8 the director of the office, in terms of dispensing the
9 $27 million in non-lethal aid that was given under
10 legislation in 1985 to the Nicaraguan Democratic
11 Resistance.
12 And the principal duty was to make sure that
13 these $27 million reached the resistance per legislation,
14 in its non-lethal form as prescribed by the legislation.
15 And we were to ensure and set up the mechanism for this
16 disbursement of funds.
17 Q Okay. The NHAO program generally — it was
18 originally set up to dispense the $27 million in
19 humanitarian aid that was passed in mid-1985, is that
20 correct?
21 A Correct.
22 Q Now, do I understand there was some — correct
23 me — that there was some possibility that after that $27
24 million program was used up, NHAO might continue to exist
25 in some fomn after that? Was that part of the original
ONetASSIHED
1244
Mmsim
1 intention?
2 A Not the original intention, but certainly it
3 was considered in 1986, in the spring of '86. The
4 Administration was asking for additional lethal and non-
5 lethal funding, and there was consideration — it was
6 never formalized — by the State Department that the
7 lethal separated from the non-lethal, that perhaps the
8 NHAO office would continue in existence.
9 Q But that didn't happen?
10 A It did not.
11 Q Vou said as deputy director you would
12 substitute for Ambassador Duemling in his absence?
13 A Right.
14 Q What were your other duties?
15 A One was obviously dealing with the press. As
16 it turned out, after about five or six months it became a
17 very demanding, shall we say, situation, because of the
18 hearings on the Hill and the press reports in the press
19 concerning the dispensation or the disbursement of funds.
20 This, we were just quite frankly beleaguered
21 by presSgueries. That actually, in the final analysis,
22 becamej!«ore' than 50 j!mc*k^ of my time, just dealing with
23 the press. Since I have been or have had press
24 experience in the past as a USIA officer overseas, it
25 became a natural situation.
UimSSIFIED
1245
UNCUiSSIFiED
1 I also, having the fluent Spanish —
2 Ambassador Duemling does not have Spanish — I acted as
3 interpreter for him many times when he dealt with members
4 of the Nicaraguan Democratic Resistamce. I also dealt
5 with directly many of the concerns of ttM suppliers in
6 the Central American region that only spoke Spanish, and
7 they would call our office in terms of billing or some
8 problem they may have had with billing or delay in
9 payment, or why wasn't a check issued on time, or perhaps
10 missing documentation for further processing by our
11 office.
12 Things of that nature were the ones that
13 basically I dealt with in the field.
14 Q Prior to becoming deputy director at NHAO,
15 what was your position?
16 A Prior to that, I was five years in Honduras as
17 the councilor of embassy for public affairs in
18 Tegucigalpa.
19 Q. What did tha^oaitioifiintail'F ■ -^^"^
20 ~zX a^ is the senior USI^^sitf<Mi abroad in an ^
21 embassy, and^basically ljfeJ,Sj^h«^;j)ress and cultural
22 function of an embassy or a U.S. mission abroad.
23 Q So in layman's terms, what does that mean you
24 did on a day to day basis?
25 A On a day to day basis, I had a cultural
UmSSIFIED
1246
iiNsmFe
1 program which included exchanges, educational exchanges,
2 academic exchanges, or exchanges of researchers, like
3 Mayan archeological findings, people, researchers that
4 were doing a study on Honduran body politic,
5 sociologists, academics that nonnally are under
6 Fulbright, or other types of exchanges that we had
7 nonnally.
8 It also included bringing a series of American
9 speakers to Honduras to speak on specific subjects, be it
10 Soviet activity in the Western Hemisphere, Latin American
11 integration, U.S. economic assistance, et cetera, and"
12 those types of topics.
13 It also included distribution of publications
14 that are put out by ^ihe U,;^^ Inform a^^i Ag«ncy fqE^se
15 abroad, as well as dealing with the press. On the press
16 side, I would deal with the national press, the local
17 Honduran press, in terms of explicating U.S. policy
18 issues with editors, reporters.
19 When they queried the embassy, I was the
20 embassy spokesman. I was the principal spokesman for the
21 embassy after the Ambassador.
22 I also dealt with the international press
23 extensively because of the interest by the American press
24 particularly in the region, particularly beginning in
25 1981 until the time I left, on the military and security
UNeUSSIFIED
1247
UmSSIFIED
1 issues, as well as the intelligence issues and^golitiral
2 issues and economic issues with regard to the region.
3 All of these were issues I dealt with in the
4 context of our policy toward Honduras.
5 Q In your position as councilor, did you come to
6 know several of the leaders, the political leaders st the
7 Nicaraguaft opposition groups |
8 A I did.
9 Q How did that come about?
10 A When the FDN was first formed, as I remember,
11 ■ I think tt'wai^l982, the middle of 'B2 ^_ ma^elt was
12 late '82r,5^ftlr ft \^t foCTiid, most of th^^iople that
13 belonged to the FDN dtrect^^^e- - - and by FDN, l"mean the'
14 Nicaracmjy^^XtemocratiafeFor^, ^^ter known^S^ Spanisb as
15 FDN — mSy ©f^ei* leailrs oi^jidl^rs of thgpBR^BGtojg^e,C-
^^^^^^^^^^^^^^H and many visitors,
17 from the United States, members of Qia^teSefflF^Committee ,
18 from Congress, members of the Administration, would visit
19 them. ■''"^'
2 0 And I was asked to interpret, because of my
21 fluency in Spanish, in many instances. In other
22 instances, there were — I had contact, not with the
2 3 leaders, but with their press spokesmen, who would ask me
24 questions of how to handle the press in terms of how do
25 you set up a public affairs thing, which I d:.d not give
UNeUSSIRED
1248
im$»D
10
1 them that expertise.
2 But what 1 did was I would refer basically
3 visiting journalists that wanted to talk to them, I would
4 just give them a phone number or a name and that was it.
5 Q Can you tell us the names of the FDN leaders
6 that you came to know on an other than very casual basis?
7 A The one I knew and I dealt with primarily was
8 their press spokesman, who dealt with all the press there
9 and issued press releases for the FDK. That was Frank
10 Arana. He is not a member of the directorate.
11 However, I did meet in the visiting groups^
12 that went there, I met Mr. Adolf o Calero, I met Mr.
13 Alfonso Callejas, Colonel — or Commandante, I should
14 say, Enrique Bermudez, and I met Edgar Chamorro.
15 This is basically in the '82, '83, primarily
16 '83, when I got to know most of them.
17 Q Okay. When the Bo land amendment number two
18 was passed in mid-1984, which b&sically cut off
19 Congressional funds for use in Central America by the
20 contras, you were in Honduras as councilor at that time,
21 is that correct?
22 A I was.
23 Q When that aid cutoff came into effect, were
24 you given any guidelines or instructions from anybody as
25 to what effect that might have on any of your activities?
UNIWIHED
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A I was told that under the legislation, I
believe it was October 1984, that terminated all U.S.
assistance to the resistance, that we no longer could
support them in any way.
I had never had a support functlsD. It
certainly did not affect me. The int«lligance or the
intelligence agencies,]
^^^^^H was the one who dealt with this.
I on occasion, on several occasions in the
'83, '84, and the beginning of '85, had been acting
deputy chief of mission. I had been given information in
terms of names. I was never given any hard intelligence
of what exactly the ogfrcations consist«#«f. " '^^ =i
At this period that you ask of, October 1984,
after the turn-o^,^ told^^^^^^^^^^^^^^^^^B
Ithat they no longer could have any contact, the
U.S. could not have any contact, with the resistance, not
even sharing of intelligence. This is October again
1984. It may have been November. I'm not certain
exactly the dates.
But I was advised informally
Did you in fact see that the level of activity
FDN dropped off
after that?
imSSIFIED
82-688 0-88-41
1250
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A Certainly I was in a position, one of the
senior positions in the embassy. I was able to see that
they did not have the traffic in terms of TD wires and
I certainly saw
a notable drop of traffic
Q Kow, from that period of time, October-
November 1984 until you left in the summer of 1985, when
you left Honduras, in that time period the FDN continued
to receive, as far as you could see, supplies, both
humanitarian and lethal, during that time period, didft't
they?
A Well, certainly it was reported in the press,
in the Honduran press and the international press, that
they were. They continued to fight inside Nicaragua . It
certainly was not as significant as it had been in '83,
the beginning of '84.
The reports that I lISW, opeajind .cl«juS^e.4
it^^became clear that
these oentinued to have a presence inside~of Hlearagua.
And therefore I assumed that they were receiving some
sort of supplies to stay afloat.
Q Well, what information did you have as far as
imSSIHED
1251
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the source of the supplies that the contra leaders
continued to receive?
A I had no official information. No one ever
told me. It was always spoken about in the press, and
when the spokesmen of the FDN or any of the leaders
spoke, they would always say it was non-U. S. government
help and that they were getting donations from friendly
countries or friendly benefactors in the United States
and other places.
But never did they mention a country or never
did they mention a specific benefactor.
Q Okay. Your position, chough, I take it^ put
you in a spot where you received lots of informationl
/ith regard to the contras themselves, isn't
that correct?
A Correct.
Q Based upon all of this information, you were
getting clues and hints and whatever else, were you able
to come to any of your own conclusions, even though it
wasn't official information that you were given, as to
where the FDN was in fact receiving their supplies from?
A I could only conclude that, one, obviously
they were getting support]
UNCtJtSSinED
1252
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UNWSIHED
14
Certainly I believe thati
might have helped them. I don't know the specifics,
whether it was lethal or non-lethal. I just assumed that
primarily they were getting enough support.
And I'll be very honest with you. I feel that
certainly I had no real contact with the contras except
in a press sort of sense during this off period,
And from them and their comments, information
was able to gather that^^^^^^^^^^^^^^^Hwas
as helpful as it could. But it seemed to me thatj^^^^^
[was not giving them, certainly not
all of their aid.
So I came to the conclusion that they were
receiving certainly some help of some sort, either from
there were also press reports, particularly in June of
1985, there was a Reuters report I remember of a ship
UNOUSSIFIEO
vzsa
mmvim
15
1 supposedly loaded with arms that arrived in Honduras at
2 Puerto Cortes. That's the port on the Atlantic side, the
3 Caribbean side.
4 And there was a report that arms, a whole
5 shipload of arms had arrived, I believe it was June of
6 1985, in Reuters. There were follow-up stories in the
7 Honduran press speculating as to the nature or where it
8 may have come from, but it was never specifically spelled
9 out as to where it may have come from or who financed it.
10 Q Did you ever mee^ before you left in the
11 summer of '85, a man by the name of Felix Rodriguez?
12 A I did.
13 Q Tell us how that came aoout?
14 A I don't remember the exact dates, but I
15 believe it was middle, probably middle to late '83. Mr.
16 Felix Rodriguez was referred to me by Mr. Jorge Mas
17 Canosa, who is the President of the Cuban-American
18 Foundation in Miami.
19 And Mr. Mas Canosa, with the Foundation, had
20 been bringing Cuban-American physicians to treat the
21 wounded of the resistance, of the FDN, and also in the
22 case of some of their worse wounded or badly injured,
23 like the case of maximal facial — that means
24 reconstructive surgery --
^^^^^^^^^^^^^H they were sending these people.
uNetASsra
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25
bringing them to the United States.
And Mr. Mas Canosa referred Felix Rodriguez to
me as a person that he should to in terms ofl
So I met Mr. Rodriguez when he came to my
office, and I don't remember the exact date or the month,
but I know it was, I believe, late '83. It may have been
as early as August of '83, somewhe^ thare. "^^
He came and introduced himself wiSh a card'-, '
from- My. Mas Canosa, and tfaeifche Should talk tomel
Then he spoke ^ji^hte role in helping bringing these
physicians^^^^^^^^^fto ^r^ thei^ taie phj^icians to.
attend theJTDK li^tnded, and also-^ke t|gE^b?i -s«rio(a^
cases bac
^^^ni^j^^atH' 4f»r treat^mt. '
Q Did you after that initial meeting with Mr.
Rodriguez have any further dealings with him?
A Yes. He came several times, and he would stop
by and chat and tell me how his project was going and
that he was bringing medicine — he claimed that he had
brought medicine or some clothing to the resistance. But
those are in terms of the wounded that he spoke of,
something to do with medical help.
wmm
1Z55
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Mmim
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Q Every time you talked to him, it dealt
specifically with this medical situation?
A Yes. I never had the impression he did any
more than that.
I also, when I mentioned it
talked to Mr. Rodrii
me, but I should not talk to Mr. Rodriguez, because he
described him as a troublemaker. And I did not ask
anything furi*«r.i ,. ■:^i_.^^
I think I saw Mr. Rodriguez once or twice
after that. But I gathered that rhere were some problems
by the way they appreciated what vas happening^^^^^^^H
Ln terms of the Nicaraguan resistance. That was
the impression I got.
Q I'm sorry, who told you that, that he was a
troublemaker?
A It wasl
Q. Was he I
A It may have been!
'I don't believe it wasl
Q Were you aware that Mr. Rodriguez eventually
ended up in El Salvador working with counrerinsurgency
efforts there?
UNetASSIHED
1256
UNEUkSSIFIED
18
1 A Yes, because in 1985 before I left in the
2 spring of '85, at least when I was there in Honduras, he
3 came to the embassy before I left. I left in July of
4 '85. And he told me that he would no longer be coming to
5 Honduras and he was going to go to El Salvador to work on
6 a project helping the Salvadoran Air Force.
7 He did not explain to me what would be the
8 nature of it. And he basically came in the capacity to
9 say goodbye, that he was just there and he would be
10 working in El Salvador.
11 Q Did he indicate or say that any of his
12 activities in El Salvador would continue to relate to the
13 FDN or other contra factions?
14 A No, and I can tell you that after I came to
15 the United States in July of 1985, Mr. Rodriguez, I
16 believe — and I don't remember the exact date — visited
17 me while I was director of the NHAO office in Rosslyn,
18 Virginia.
19 And it was the winter, I'd have to say it was
20 the winter. Maybe it was late spring, visiting me and
21 he said he had been up here visiting some friends of his
22 in the White House.
23 And then I had a conversation with him, and he
24 explained a little bit more what he did in El Salvador
25 and the problems that they were having in terms of this
ONiASSIHED
1257
UimSSIFIED
1 program he had with the Salvadoran Air Force.
2 But if anything, when he would mention the
3 FDN, as he did previous to this, prior to this
4 conversation, he was very critical of U.S. handling, as
5 he would put it, of this whole project. He wa» highly
6 critical. He said that it was being done all wrong. He
7 would repeatedly say that, without getting int«
8 specifics.
9 And that was all he basically mentioned, other
10 than the medical aspect that he was involved with, with
11 the FDN. His only reference was that, and even at that
12 period — as I said, he visited me once in Rosslyn, I
13 don't remember, in late winter or early spring of '86.
14 Then Mr. Rodriguez called me up in the summer
15 that h* was tor* and jiist sayajc hallo, bec^^a-^jfr^W I
16 had had sur^jp^, bac}c su:^ry'^^nd calMpC m« %f aak me ^
17 how I wa^' Z hil^ac^^sffirery-^n J^ ag'^iafeteSE^ui^
18 fea two BOR^E^ ""' :^' '"' ., ^
19 1^ And I belie\fie it was eitfier July or August of
2 0 this past ^gPiTr^, l,9it, that he called me__f^^ here ij^
21 Washington. And that's ^1 he said^ ju^l^iigked. It was-
2 2 a courtasy call^jypu tarow, j^pi^fMh.
2 3 And the last time I heard from Mr. Rodriguez
24 was in September, late September — I don't remember the
25 exact date — of 1986. He called me from El Salvador
UNfilASSIFIED
1258
UNCy^SIHED
20
1 because he claimed that Congressman Claude Pepper had
2 been down in El Salvador with some staffers, and the way
3 he related this is that he had met with the Congressman
4 or his staffers.
5 I'm not certain if in fact he met with the
6 Congressman, but I know it was some staffers he claimed
7 he had met, in terms of winning Congressman Pepper's
8 support for some bill affecting El Salvador that was to
9 be included in the continuing resolution.
10 And he called me to ask me if I could call a
11 certain gentleman from Mr. Pepper's staff to find out*
12 about the status. And it was late at night and it had to
13 be the very — either the second or virtually the last
14 day of September, because that's when the continuing
15 resolution would have to come in.
16 And I tried calling. No one was in that
17 office. It was late at night. It was about 9:30 or
18 10:00. I did not hear from Mr. Rodriguez after that.
19 Q When Felix Rodriguez went to El Salvador,
20 which as I understand it was, through other evidence, was
21 basically January or February of '85 — go ahead.?
22 A Yes. Now that you mention it, El Salvador —
23 I would have to amplify another meeting with Mr.
24 Rodriguez.
25 Q Go ahead.
UmSSIFIED
1259
UNtASSIFIED
21
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A I did meet Mr. Rodriguez. It was around
December, just briefly. I did not really talk to Mr.
Rodriguez, but very briefly in December of — it was
right after Christmas of '85. It had to be around
December 27th. I don't know the exact date. I would
have to double check my calendar.
But I had to go on a visit to Honduras in late
December of '85, and on this visit I was asked by the
Deputy Assistant Secretary of State, Mr. William Walker,
to accompany him
And I went with Mr. Walker on — I don't know
what it's called, but it's one of the White House planes.
It was a Jetstar, and we were accompanied by two other
gentlemen on that trip and we stopped off in Key West,
and then we stopped off in El Salvador, unbepknownst to
me until we were in the air that we were going to have a
stopover in El Salvador, and that's when I saw Mr.
Rodriguez, before I saw him in — before he visited me.
UNOIASSIFIED
1260
UN6IASSIFIED
1 Q _^What were the circumstances of stopping in El
2 Salvador?
3 A It was never explained to me exactly what it
4 was.
5 Q Did you meet with any&ody while you were in El
6 Salvador?
7 A Well, yes^_we met w^^ soma^eople on the
8 ground. There were Star of ts in oar patty, and -we met
9 with people on the ground, which "Sifeluded Ai^aVlBado^
Corr^^^^^^^^^^^^^^^^^^HasS^t inctWwt.-
11 apparently soma pefjgle from the-MI^^rgyp. X'^hinlc it
12 was tfia i^^ section dSief . --= r==^""^>^ -
13 Thei» were, some /2SSr oeopfsa ^did not kndw7 "*
14 because I wafc_intraauce4^»ly_ — actual^, I had agt '^
15 AmbaSifK^^^^r befoiT-fl- s« I^^eei^sa^l^. ~ i^ ,_^3:7^ 11
16 Q What was the purpose of the meeting, could you
17 tell?
18 A It was the two gentlemen who were with us had
19 business to do there with them, and I really did not
20 participate in the conversations. They met with these
21 people, so I was not privy to the conversation, only the
22 beginning, the basic formalities.
23 Q How did you see Felix Rodriguez during that
24 Stopover?
25 A He was there. He came into the meeting.
UNWSIRED
1261
UimsSIRED
23
1 Q He participated in pat of the meeting?
2 A Part of it, but not most of it. He left as
3 well. He left and I stepped outside and went back to the
4 plane.
5 Q Do you recall any part of the discussion that
6 was held during the time Felix Rodriguez was at that
7 meeting?
8 A I'm trying to remember. One gentleman
9 chastized him, told him to leave the room because, as I
10 remember the correct wording, we can't trust Cubans, they
11 talk too much. He said that to Mr. Rodriguez.
12 Q You say you were with deputy Assistant
13 Secretary Walker and two other people. Who were the
14 other two?
15 A Lieutenant Colonel Oliver North and^^^H
16 ^^^^^Kiead of the Central American Task Force.
17 Q This, first of all, was a stopover in El
18 Salvador, and from there it went on to Honduras?
19 A We were only on the ground roughly about maybe
20 half an hour to 40 minutes, as I recall.
21 Q And you don't recall, other than what you just
22 said, you don't recall anything else about the meeting,
23 what the topic of discussion was?
24 A I think the topic of discussion was — and it
25 was the way I picked it up. It was not formally told to
UNeUSSIFIED
1262
UNCUSSIFIED
me, but the way I was able to sense this was -- and I say-
it was not explained to me exactly what the nature of the
stop was, but I could only infer, and I repeat, infer,
that it had to do witl-
And basically, my impression was to basically
find out what in fact couldl
Q But you weren't asked to contribute anything
to the meeting?
A Ko, I was not.
Q How long was the stofi^ver in El Salvador?
A As I said earlier, it was between 30 and 40
minutes, as I remember.
mmm
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OIICIASSIHED
27
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Q Was there any other business In Honduras
before you left?
A After that, immediately we got back on the
plana a|id turned around, came back, with a stopover in
Key West for refueling, and that was it.
Q That wasn't the first time you met Oliver
North, is it?
A No. I had met Colonel North when he was a
major, and I don't recall exact dates. But I remember it
was late '82 or some time in early '83. He came to
UNCtASSIHED
1266
UNIMSSinED
28
1 Honduras as a junior NSC staffer, I was introduced to him
2 as.
3 He was at receptions, I guess. I know for a
4 fact I saw him at receptions at either — at both the
5 Ambassador's house and the deputy chief of mission's
6 house in that period. And then I spoke to him and he
7 identified himself, and that's how we got to know each
8 other, sitting at dinner or at a cocktail party and some
9 of the receptions he attended during this period. That's
10 when I got to know him.
11 Q Well, before you left Honduras in July of '85,
12 how many times had you met Colonel North by then? Can-
13 you give me an approximation? A lot of times, ten times?
14 A I had maybe seen him at least six times,
15 probably no more than ten, in that period between late
16 '82 and the middle of '85.
17 Q Did you ever see him — before you left
18 Honduras, did you ever see him in Washington?
19 A No, I did not.
20 Q So all the times you saw him, they were times
21 when ha was in Central America?
22 A He was in Central America.
23 Q Was he always with a party of people?
24 A Yes, he was.
25 Q Did you' understand Colonel North to be the NSC
UNtftSSIFIED
1267
UNCUSSIFIED
29
1 staffer who dealt primarily with Central American and
2 Nicaraguan matters?
3 A No, I just thought he dealt with security
4 issues. But I remember that the people that we were
5 introduced to on the NSC were Mr. Fontaine, and then Mr.
6 Menges, I don't remember going, but Mr. Fontaine, Roger
7 Fontaine, went several times.
8 I don't recall that they went together,
9 frankly. And then Mr. Burghardt subsequently. I saw him
10 in Honduras. And so we knew, in terms of the NSC, he was
11 the director for Latin American affairs on the NSC, or a
12 deputy such as Jackie Tillman that dealt with these
13 issues.
14 I always had the impression that Colonel North
15 or Major North then, as I knew him, was on the NSC and
16 dealt with larger issues of security and terrorism, and
17 that was what I had an understanding, although he was
18 very interested in this issue of Central America and
19 particularly the Nicaraguan issue.
20 I did not know the specifics of his interest.
21 Q Prior to leaving Honduras in July of '85, did
22 you ever come to know in any way that Colonel North was
23 dealing with operational details of the resupply of the
contra ef fort^^^^^^^^^^^^^^^HflHMU^|^^^|
25 A No. At the time I was in Honduras, I never
UNdASSIRED
1268
UNIMSSIFIED
30
1 had that sense or feeling or suggestion.
2 Q Okay. How did you come to be deputy director
3 at NHAO?
4 A When I came back from Honduras in July of
5 1985, I was assigned to the National War College here in
6 Washington at Fort McNair, and I visited Raymond
7 Burghardt, who was then recently named the director for
8 Latin American affairs on the NSC. He had served as my
9 colleague as political counselor in Honduras in the '82
10 to early '84 period. So we were colleagues on a country
11 team, and we had kept in touch with each other.
12 And I went to the executive office building to
13 see him, and we went to lunch on a couple of occasions.
14 And I ran into Oliver North in the hall one time and
15 greeted him, and he chatted us up and that was it.
16 Then Mr. Burghardt asked me if I was
17 interested in taking the job that would be opening for
18 the deputy director of the NHAO office, because the
19 appropriations had now been set forth and it was a
20 question of when they would sign the executive order, and
21 they were looking.
22 And at first I said I was not terribly
23 interested in something like that. Then I saw North one
24 day, it was in August 1986 — '85, rather. And I asked
25 him what he thought of that idea.
UNMSIHED
1269
UNCUSSIREO
31
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5.
6
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8
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16
17
18
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20
21
22
23
24
25
And Colonel North told me that he felt I
should — if anything, I should go work for Ambassador
Otto Reich in public diplomacy. And that was what he
thought I should do, and that Ray Burghardt thought I
should seriously consider this other job in the NHAO
office.
I did not make any determination or make any
decision at that point in August. It was only toward the
very end of August when I was called by William Walker,
the deputy assistant secretary for Latin America, who is
in charge of Central America, who had been my deputy -
chief of mission in the '80- '82 pariod in Honduras and I
had a personal relationship with him — we were good
friends.
He asked me if I would seriously consider
taking the deputy directorship at the NHAO office,
because he claimed that I had the language, I had
experience with the region, I knew the — I had met the
resistance, I was familiar with the policy^^^^^^^^^H
land because of the nature of the
program as it had been legislated by Congress, it would
be somewhat difficult, and we would be able to get this
non-lethal aid to the resistance.
wm\m
1270
yilp.r^ir^MMKii 32
1 I then went back to my agency, USIA, and asked
2 them. They then came back and suggested that, if in fact
3 it was needed — and then they entered into a discussion
4 with the State Department.
5 And then I left the War College after four or
6 five weeks and went to NHAO around the first week of
7 September 1985.
8 Q During your discussions with William Walker,
9 Ambassador Duemling hadn't been picked yet to be
10 Ambassador, had he?
11 A No. The first time Walker mentioned it to me,
12 no. It was only after about a week or so — I don't
13 recall the exact time frame — when he told me that
14 Ambassador Duemling had been selected. That's when he
15 mentioned that he was seriously asking me to consider it,
16 after they had chosen Ambassador Duemling towards the end
17 of August 1985.
18 Q So it was your impression that you didn't
19 accept the position of deputy director before Duemling
20 was picked as director, is that right?
21 A It was only after Duemling was picked.
22 Q Did — what was your perception? Why didn't
23 you believe that Ambassador Duemling was the one who
24 should be calling you up and asking you if you wanted to
25 be deputy director, as opposed to William Walker, if
lim.«m
1271
Mmsma
33
1 Ouemllng had been picked?
2 A I don't know what the procedures in that are.
3 Sometimes the — I know that an Ambassador — of course,
4 this is not a mission; this is an office in the
5 Department. I don't know the politics of that in the
6 Department, whether an Ambassador can choose his deputy.
7 I know that he has a very, very strong say-so
8 when it is deputy in a mission overseas, and he can only
9 choose his secretary and his DCM. Other than that, he
10 inherits everything else, so he is at the mercy of the
H bureaucracy.
12 In this case, I don't know whether office
13 directors really get to choose their deputies. My
14 impression is that is not the case. I think that is left
15 up to personnel and the powers that be in each area.
16 Q When you talked with North about the
17 possibility of taking this position as deputy director
18 and he told you he thought you should go with Otto
19 Raich's piiblic diplomacy group, didn't North indicate to
20 you, though, that he thought that one or the other would
21 be a good position for you?
22 A Right. But he was inclined, the second time I
23 talked to him on this matter in August — he then said,
24 well, I know that Burghardt and other people want you to
25 go to be in NHAO.
UNWSIHED
1272
UNCUiSSiFIED
34
1 I'm not certain, frankly, if his druthers were
2 that I go work with Otto Reich because Otto Reich would
3 be leaving and his deputy, Bueschler, was going as
4 Ambassador to Guinea Bissau and Otto Reich would be going
5 as Ambassador to Venezuela, and he suggested that I would
6 be ideal for taking over that office in the event that
7 otto Reich left some time in the next few months. And
8 that was the basis of his interest in my taking — that I
9 should ask or should put in for that job.
10 And I had discussed it with Ambassador Reich.
11 Q Now, before August of 1985 had you ever met
12 Rob Owen, Robert Owen?
13 A I believe — and I don't remember the dates —
14 he came with the legislative group to Honduras. I don't
15 remember meeting him, except the name was there in a
16 crowd of Republican staffers from the Hill, I believe the
17 Republican staffers from the Senate majority side at the
18 time.
19 And I remember, I believe he came there with
20 Senator Quayle or the Republican Caucus. I'm not certain
21 which of the two. He may have told me later, and that's
22 why I'm saying it's Quayle or the Republican Caucus,
23 Republican Caucus, Foreign Policy Caucus, something to
24 that effect, with that group.
25 And I remember one of the other ladies who was
UNttASSIFIED
1273
omssm
35
1 there was Mary Calhoun, I believe, who works for Senator
2 Synuns. And it was just an orientation visit and that was
3 it. I met them briefly and that was it, shook hands, but
4 I had no conversation with him.
5 Q Was that the only time you ever, to your
€ knowledge, ever met him up until he actually came to work
7 at NHAO?
8 A Yes, that's the only time I remember, and I
9 didn't even remember his face, because we had so many
10 staffers.
11 Q Did North — up to this point, did North e^er
12 indicate to you that Rob Owen was doing any work or
13 activity for him in Central America?
14 A No, it was only after I was deputy and that
15 Rob came to the office, I believe, to talk to Duemling,
16 to Ambassador Duemling. And I was not around, but later
17 — I don't recall if he came with the three members of
18 the UNO directorate.
19 I remember he came to our office in Rosslyn,
20 and that's when we spoke again for the first time, as I
21 recall the first time. I did go with him to North's
22 office subsequently, and I remember that North said it
23 would be a very good idea that Rob Owen work for NHAO
24 because he had learned something about the resistance,
25 something about the Indians, specifically the Meskito
OimSSIRED
1274
KNCMfiEO
36
1 Indians and the Creoles; and that he had been working on
2 the medical side of things with a gentleman by the name
3 of Dr. Vernon Chaney, I believe, with the Tom Dooley
4 Foundation.
5 I never met Dr. Chaney. Ambassador Duemling
6 did. He brought a proposal that I was led to believe Rob
7 had helped him on, and he was never given a contract or
8 anything. Dr. Chaney..
9 But that's the way Colonel North described
10 Rob's, should we say, curriculum or qualifications for
11 getting a consultancy of some sort with NHAO.
12 Q How did you end up going with Robert Owen to
13 Oliver North's office?
14 A Because when Rob came to our office several
15 times, then he knew I knew Oliver or Ollie. So one day
16 when we went to lunch. we were over by the Executive
17 Office Building and we dropped in on North.
18 Q This was before he had his —
19 A I believe it was around late September or
20 October of '85.
21 Q This was after he had already — let me just
22 say this. He came to Ambassador Duemling, tried to get a
23 position, and then eventually UNO wrote a letter and
24 subsequently there was a RIG. meeting and subsequently —
25 A Exactly.
umssm
1275
UimSSIFIED
37
1 Q Where in that sequence of events was it that
2 you were with him and went to Oliver North's office?
3 A It had to be before — I believe it was, and I
4 don't recall this exactly, but it seems to me that it was
5 late September, and I believe it was certainly before the
6 RIG or any decision had been made.
7 But he mentioned it to me and I mentioned it
8 to Ambassador Duemling, and Duemling, Ambassador
9 Duemling, told me that he didn't see what he would do.
10 And I said I wasn't sure myself, but he claimed to know
11 something about particularly the medical delivery system
12 to the Meskito Indians, et cetera, and used the Chaney —
13 Dr. Chaney 's study.
14 My own impression was that Rob did not speak
15 Spanish, much less Meskito language, the language of the
16 Meskito Indians. So I didn't know how useful his
17 consultancy would be.
18 And Duemling raised it first and I agreed with
19 him.
20 Q So would it be fair to say that you weren't
21 particularly lobbying to get Owen a position with NHAO?
22 A No, because I knew that Ambassador Duemling
23 had mentioned it to me even before I spoke to North, or
24 that North mentioned it to me. I knew Ambassador
25 Duemling had mentioned it. He had been around, and what
UNimSIHED
1276
UNeUSSIFIED
38
1 was Owen all about?
2 And Ambassador Duemling felt that he wasn't in
3 a position to issue a consultancy or give him a
4 consultancy. So I knew Ambassador Duemling 's feelings on
5 that matter, and I did mention it, I believe I mentioned
6 it, to North.
7 I said, well, I don't think Ambassador
8 Duemling can be convinced of this. He said, well, you
9 guys should consider it. He didn't seem to pressure me
10 or insist. He made it in terms of a suggestion, that it
11 would be good to have Rob work with us. He didn't say*
12 hire him. He didn't command us to do it, at least not to
13 me anyway.
14 Q I'm still a little confused. If Owen had
15 already been rejected by Ambassador Duemling, what were
16 the circumstances under which you were having lunch with
17 him and then you all went by —
18 A Because he kept coming by the office. That
19 was basically it, he hung around the office. At that
20 point in September of '85, we had many of the resistance
21 people come into our office. And he knew Arturo Cruz,
22 Adolf o Calero, and Robelo.
23 And I remember once he came in with Robelo,
24 and then he came with all three, as I remember it
25 correctly, as I recall now. And I don't recall the
mmm
1277
UNCUSSIFIED
39
1 specifics of the dates, but I remember him coming on
2 several occasions during that period to accompany the
3 resistance and talk with Ambassador Duemling.
4 Then the impression was that he had found
5 Ambassador Duemling wasn't very amenable to his contract.
6 He knew me and he knew 01 lie, so we went to lunch one
7 day. I believe it was the basis of a lunch, and we were
8 somewhere, and he suggested that we go see Ollie.
9 Q Did North ever indicate to you or in your
10 presence in any way that he wanted Robert Owen at NHAO
11 for any reasons that would serve Oliver North directlj'?
12 A No. The impression I got, it wasn't like
13 that. I mean, maybe there is something, if you rephrase
14 your question perhaps. Ask me the question again.
15 Q Has North ever indicated to you or in your
16 presence that there were reasons he wanted Robert Owen at
17 NHAO that would serve Oliver North's purposes?
18 A No, I didn't interpret it in that way. What
19 he said was that Rob had been very helpful to him in the
20 past, and sort of his eyes and ears in Central America
21 with the contras.
22 I don't remember if he used those specific
23 words, but my impression was like he was his eyes and
24 ears, and that he kept him abreast of a lot of things.
25 But he did not get into specifics ever with me on that
UNGIASSIFIED
1278
UtiASSIFIED
1 issue of what Rob did.
2 And I felt like he was trying to reward Rob
3 because Rob had been working without pay. That was my
4 impression. And I remember in that conversation, or
5 maybe it was the second conversation with Owen present,
6 that Owen asked that he needed reimbursement for some
7 travel expenditures; he was out of pocket sizable amounts
8 of money. The figure $600 to $700 stands out in my mind
9 now. I believe it was something like that.
10 And North answered, he said: I'll try to get
11 somebody to get some money to you. And that was it, 6ut
12 no description, no suggestion as to what he did or why he
13 was being paid or where the money was coming from.
14 Q Vou were at the RIG meeting in which Owen's
15 contract was discussed?
16 A I was.
17 Q What do you recall about the RIG meeting?
18 A I remember that Ambassador Duemling went and
19 said, we have this letter — well, first he outlined that
20 Rob had come to him with Vern Chaney and that Rob wanted
21 to work as a consultant, and then that it had been
22 verbally conveyed to him by members of the resistance,
23 and then finally Arturo Cruz, I believe, brought a letter
24 or two letters.
25 I think one wsls Jiij»,, ^:^^njk)rsement. I don't
wmm
1279
UNCUSSIFIEO
41
1 remember exactly whether it was one letter or two
2 letters. I know there was a letter signed by all three,
3 and I believe it was sent.
4 But I think that Arturo Cruz, if my memory
5. serves me correctly, brought a letter and personally
6 endorsed Rob's role as getting a consultancy with NHAO.
7 So Ambassador Duemling described all of that, because I
8 was not in those conversations with the directorate or
9 Mr. Cruz on the Rob Owen issue.
10 Ambassador Duemling at RIG voiced his concern,
11 saying that he was not sure what in fact Rob Owen could
12 do or bring or offer to the office that we couldn't do.
13 He didn't have Spanish, he didn't have an expertise in
14 medical or anything like that, except that he had been
15 doing it.
16 And Ambassador Duemling suggested, well, it
17 was North's idea, and he didn't state it — I don't
18 remember correctly, but he said, look, the directorate is
19 now on me; what gives here?
20 And Ambassador Abrams and Bill Walker and
21 other members — and I don't recall all the members
22 present — went back and forth, and finally they said:
23 Well, it won't hurt to give him a consultancy. And it
24 was decided at the RIG. I did not participate in the
25 discussions.
umssm
1280
UimSSIHED
1 Q You didn't speak out for or against hiring
2 him?
3 A No.
4 . Q Now, after Owen signed his contract with NHAO,
5 and I believe actually it was a contract with his
6 company, Institute for Democracy Education Assistance?
7 A Yes.
8 Q There was a grant with NHAO. After that, did
9 you ever have any information that he continued to be
10 Oliver North's eyes and ears in Central America?
11 A Yes, because he mentioned to me that he sp&ke
12 to Ollie quite often. And of course. Ambassador Duemling
13 basically had Rob report to me in terns of any reports,
14 so I required all the written trip reports, what he did
15 on each trip.
16 And he would bring me and I would go over with
17 our B&F man, our budget and fiscal fellow in the office,
18 to make sure we vetted his expenditures correctly. So
19 basically that was my role.
20 But he also met with Ambassador Duemling when
21 h« would debrief Ambassador Duemling after a meeting.
22 Q What did he tell you?
23 A After every trip, I should say.
24 Q What did he tell you about his many
25 conversations with Oliver North? What did he say about
nSSIRED
1281
43
1 it?
2 A He never really got into any details of any
3 sort with me. The only thing he would say is North's
4 concern with the way the whole movement or the whole
5 project was going, and that he was concerned about not
6 getting lethal aid funding in '86.
7 So Owen would tell me that North was very
8 concerned about the viability of the contras, their
9 ability to equip themselves military. He had concerns
10 about certain elements of the FDN, because I increasingly
11 began to notice that Rob Owen fell into disfavor with "the
12 FDN.
13 And Rob told me that the FDN was not very kind
14 to him any more, because they felt that he was sort of
15 snitching to North about some of their problems or some
16 of the things that they were doing. Specifically, the
17 only thing he ever mentioned to me was that he was
18 telling North the way the Meskitoes or the Indians were
19 being treated by the FDN, and that they were never
20 getting their fair share.
21 And the Indians were always complaining to
22 Owen, and one of the reasons I believe that Owen had an
23 affinity with the Black Creoles and Indians is that there w«t<.
24 many English speakers. The Creoles are virtually English
25 speakers, and many of the Meskitoes, Atlantic coast
wmm
82-688 0-88-42
1282
UNCUSSinED
1 people in Nicaragua, speak English. So Rob was able to
2 communicate with them.
3 And it seemed to me when we had meetings, we
4 had members of the Meskito tribe or other Atlantic coast
5 people present, Rob always had an affinity. They always
6 sought Rob out and they saw him as kind of a protector.
7 So I felt — the impression I got from Rob was that he
8 was reporting to North on some of the problems that the
9 Indians were having with the FDN primarily.
10 And then he began to tell me that the FDN —
11 he was in disfavor with the FDN by the end of '85,
12 beginning of '86.
13 Q When did Owen's activities for NHAO
14 essentially stop?
15 A They stopped essentially, I believe — I'd
16 have to go back, but I'm almost certain Hay 31st, 1986.
17 Q Why do you pick that particular day?
18 A Because I think that the contract stated that,
19 the terms of the contract. After that he had nothing to
20 do with us.
21 Q Did you continue to see him?
22 A I saw him, because we were then moved to K
23 Street, over on K Street here in Washington, 21st and K.
24 And he then had a job for the Institute for Terrorism and
25 Democracy. I'm not certain of that, but a Mr.
UmSSIRED
1283
UNCLASSIFIED
1 Livingston. And he came to visit us, because he was only
2 a block or two away. He could pop in at times at
3 lunchtime and have a beer or a sandwich with us, and he
4 knew everyone in the office at that point.
5 Q What did he tell you he was doing at that
6 period of time?
7 A At that point, he was only working for the
8 think tank, he described it as Mr. Livingston's think
9 tank. And he had a job there. And then by that point —
10 that was last summer, in June-July primarily — well,
11 June I didn't see much of him because I was sick.
12 But July I saw him, and in August I left NHAO.
13 He spoke of his disillusionment with the whole project
14 and his deep concern about the way the FDN comported
15 itself, behaved itself. And he was very contemptuous,
16 contemptible of the leadership of the FDN and the way
17 they carried out their duties, the way he saw it.
18 He just felt that they were not very
19 effective. That was his concern.
20 Q When was the last time you saw Rob Owen?
21 A I saw Rob — I'm trying to remember. He
22 invited me, my wife and myself, to dinner at his house
23 when Cesar Sereseres, the fellow from Iran, was in town.
24 And he invited Cesar for dinner and he had us over for
25 dinner, and that was the last time.
UNCLASSIFIED
1284
IMASSIFIED
46
1 Q When was that?
2 A About four or five weeks ago.
3 Q What about during the 198 6 time period? Did
4 you continue to see him frequently?
5 A No. In the fall, I think I may have seen him
6 once or twice in the fall of '86.
7 Q Okay. Now —
8 A But I have seen him maybe four times since
9 that period.
10 Q You talked about him being disillusioned with
11 the project. What project were you talking about?
12 A The contras, the whole contra support.
13 Q Did he ever specifically talk about any of the
14 private groups that he was disillusioned with?
15 A No. The only thing, I told him, because I was
16 picking up a lot, particularly in the late spring of '86,
17 from the press that were placing him in different
18 situations that may have not been advantageous to the
19 NHAO and the State Department, because some reporters
2 0 specifically came to me and said that they had
21 information that Rob had been involved in the discussion
22 of some arms shipments or arms purchases for the contras.
23 I approached Rob about this.
2 4 Q When was this?
25 A In the spring of '86. I approached Rob about
IWUSSIRED
1285
UNMSIFIED
47
1 this and told him, gave him the specifics. In fact, I
2 remember that supposedly he was with Adolfo Calero in San
3 Francisco in a meeting in early '85. Supposedly that was
4 what the press reporter had, and he told me this and
5 asked me if I knew anything about it. And I said I did
6 not.
7 So then I subsequently asked Rob Owen. I
8 said, did you know that the press is saying this? And
9 Rob did not deny it, but did not admit it. He sort of
10 smiled and said: Well, there are so many interpetations,
11 something to that effect.
12 But I don't remember him giving me a
13 categorical answer on it.
14 Q VJhich press was this that came to you?
15 A It was American press, the Associated Press.
16 Q Is this a part of the sequence of events that
17 involved the people that came to your office one time and
18 complained to you about the Southern Air?
19 A No.
20 Q But it was later after that you got a call
21 from a press person about that same matter, as I recall?
22 A Yes.
23 Q Was that the same?
24 A No, no, no. That was very different. This is
25 much earlier.
wmm\m
1286
UNWSIFIED
48
1 Q Well, we're going to get back to that in a
2 minute. Let me first finish up with Owen.
3 Did you have any information at any time that
4 Owen was transporting military intelligence information
5 on his trips to Central America to be given to various
6 contra military leaders?
7 A No, I specifically did not. I knew that he
8 must have carried it because of his relationship with
9 North became increasingly clear. I didn't understand in
10 the beginning the relationship. I thought that he was
11 basically down there because he believed in the cause, and
12 he was a friend of the contras.
13 But as the months went by, I realized that he
14 had a more specific function, and in fact Bob Duemling
15 and I discussed it on several occasions. And then
16 obviously, when I was asked about the arms, his presence
17 in the San Francisco meeting, I confronted him.
18 But before that there had been another concern
19 that had arisen that I had confronted Rob about in terms
2 0 of his contacts.
21 Q What was that?
22 A That was in February of '86 in Miami. A
23 journalist friend of mine said that Rob came to visit in
24 the hotel. I think he was attending the same meeting
25 actually in his capacity as a consultant, and a fellow
UNtASSinED
1287
UfimSSIFIED
49
1 Cuban-American by the name of Vidal — I don't remember
2 the first name — came to the hotel.
3 And this friend of mine — I was sitting in
4 the lobby with this journalist friend of mine and saw
5 him, and he said: You know, your friend Owen should be
6 more careful about his friends. And then he went on to
7 describe Vidal as a very ,^^^rery^ suspect, a suspicious
8 character that may be linked to some drug teafficking.
9 And then I ^Id Rob abou£.this. -I said: Rob,
10 I am told that this man is not aoma<ne you should be
11 around, because he has got a reputation for some drug,
12 trafficking. And Rob said: Is that so? Who told you"
13 this?
14 And I said: This friend, and i^3i« didn't
15 believe the jou»mlii?i^ should: •ei^omeone ^ thtf ibade
16 Counl^^olice Department or Miami, I don't remember
17 which. He gave me a name to give him, which I don't
18 recall now.
19 But Rob was somewhat offended by the
20 suggestion. He said that wasn't so.
21 Q Let me understand this. You were with a
22 journalist friend?
23 A In the lobby of the hotel.
24 Q He saw this man Vidal?
25 A With Rob.
UNeiASSIFIED
1288
umssra
50
1 Q Vidal was with Rob at the time?
2 A Yes, in the hotel lobby. I didn't notice. He
3 told me later, he said, I saw Vidal.
4 Q Did Owen tell you what he and Vidal were
5 discussing?
6 A No. When I asked him, in fact, when I told
7 him what the journalist friend had said about Vidal, he
8 said that wasn't so; he didn't have any indication of any
9 such activity by Vjudal. In fact, Vidat — ^ he introduced
10 me to Vidal in the hotel, and Vidal showed me a document
11 in Spanish, an assessmsnt — he showed it to roe. I read
12 it. ^ "^ ^ _^ - "
13 It was on why the contras were losing. It was
14 basically sort of — it was sort of an allegedly sort of
15 strategic paper, a think piece. And it went into a lot
16 of -dynaiBiQ^^^pb^Bcy — or pt^-fct^^^pthM^^ in^~ T^ -
17 Nicaragua^Bois.^-tKe contra^^ t^ _t^^ tfj^aliVI. "^
18 :^_ ^ap«»icall^Vida^»|jl|feiBo»t ^^^JT^gf^e ^
19 contras' inability to do more in Nicaragua. A^?this was
2 0 the only cony^s^tion I had with Vidal .„":; Jto, waa.;.^
21 intyoducad toTW in the" hotel by ^^. :^ „ ~ ^^'*"
22 ^ ^hif^as i:S^M l^Mij? j3B3ab, intt»l?
23 A In the Holiday Inn, Brickie Point.
24 Q What were you doing there?
2 5 A We were having a-a««ting there. Ambassador
UmSSIFIED
1289
UNGIASSIFIED
51
1 Duemling was there. We would have meetings in Miami with
2 the resistance leaders, particularly the logistics
3 people, the accountants, and some of the political
4 leadership of the resistance.
5 We had Ambassador Duemling, myself, and one or
6 two other people from the office, Kevin Whittaker, a
7 political officer, or Phil Buechler, our field operations
8 man, would go. We were all there at that time.
9 Q Did you ever tell Duemling about — first of
10 all, about this statement that was made about Owen and
11 Vidal?
12 A I don't remember telling him then. I think I
13 told him much later, when things began to come out,
14 because I felt it was not substantiated and I thought it
15 was a little scurrilous at that point. And this fellow
16 who told me, you know, I know that he was a reporter who
17 has dealt with a lot of police staff, and I didn't doubt
18 his word, but I wasn't sure, like so many things in
19 Miami.
20 But I did bring it to Owen's attention, and I
21 also brought it to our political officer, I believe,
22 Kevin Whittaker. I mentioned it to Whittaker. I said,
23 this guy is supposed to be a skunk.
24 Q Did you ever tell Duemling about the statement
25 that had been made to you, or allegation, about Owen and
UmSSIFlEO
1290
UIKIASSIFIED
52
1 Calero in San Francisco?
2 A That was later, and I believe I did. And I
3 think it was in the contest as things began to come out
4 in the press about Owen. I think it was in the larger
5 context of all this reporting that was coming out about
6 Owen .
7 Q What time was it that you talked to Duemling
8 about it?
9 A I'm trying to remember. I don't remember if it
10 was right before I got sick or right after. It had to be
11 the beginning of May or the middle of June. I don't -
12 recall. I know certainly it had to be, at the latest,
13 the middle of June when I came back, because I was out
14 six or seven weeks in that whole period. May and June
15 virtually I was out.
16 So I think, if anything, it was late April.
17 Q Did you know or have any information in any
18 way that when Owen came back from a trip in Central
19 America during the time he was working with NHAO that he
20 would file two separate trip reports, one for NHAO and
21 one for Oliver North?
22 A No, I did not specifically know that. But I
23 assumed that he reported to North, because of his
24 continuing conversations with me that he saw Ollie. So I
25 didn't know what nature these reports took, whether they
UNGUSSIFIED
1291
UmSSIFIED
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
were oral or written.
Q Did you ever ask him what it was he and North
were discussing?
A Yes. He told me he was telling him how he saw
the ground situation in terms of where the movement was
going. And I feel that he led me to believe, anyway,
that it was all to do with his criticism of the FlWs ^^
treatment of the Meskitoes and the Creoles, that they
were not getting a fair share of the supplies.
Q Beyond political discussions about political
problems, did he ever tell you or did you ever know that
he and North were discussing specifically military ,
matters-wid what to ^o about..^Jie provision of milffkry
weapons to the^^ntras? ^-^ _ _. . ^ .
'a Nq^^ NQ^^ae^ftr kn^^iat7^UQnl^>^^ t^
susp«:1ya^cc a&«St^t:£^^H^ TUMffilDcSSZtl 1 JfeL J^t ~ ~
welIr^B«gaifc^naedI^ad_'fft^^fcgl.tgBM liayuflE wiiat^3_ ^
NHAO hadpaTg^aigE^thou^^Ha 0' t*, p^tf • ^^B^t^'m —
DidHjBeu ever h
Owan wasjfeag- use<^fv OlTv«^Mort:
paya«nQpto varl«is_^
A No. Again, the first ^ime I heard that was in
the press, the same Associated Press reporter that asked
me if I knew that — he described him as a bag man, and I
1292
UNCUSSIRED
54
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
said I did not know that.
MR. BANDUSEN: Do you have a time period for
that?
THE WITNESS: Spring. It must have been March
or April of 1986.
BY MR. SMILJANICH: (Resuming)
Q "
Q First of all, how many trips did you take Xo
Central America during the whole lime from August of '§5
to August of '86?
A I took the onel
Then I took the one I mentioned earlier that we
went by U.S. aircraft and we returned the same day in
December.
And I did not take another trip with NHAO to
Central America.
Q Did you have any other trips to Central
America that were separate from NHAO?
A No. During that period, no, from August to
August .
Q August to August, '85 to '86, you were
UNetASSIFIED
1293
imSSIHED
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
25
Central America twice?
A Let me make sure. September — December we
couldn't go down and I didn't go because Ambrosio,
Ortega, and Ambassador Duemling went. I don't remember
another trip.
Q Have you been back since?
A I have been in my capacity in public
diplomacy, deputy coordinator for public diplomacy.
Q^^^^^^^^^^^^^^^^^^^^^^^^^^^^^Hwhat was the
purpose!
A^^^^^^^^^^^^H it was to discuss with the
as to how we would be able to deliver our
non-lethal supplies, as stipulated under the legislation
of 1985.
UNCUSSIFIED
1294
1295
V
age 6^
ied in FuJl
1296
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
Q Let me get to the point here. Is it true that
one of the conditions that was placedi
an this program was that NHAO was not allowed
^ |itself to monftor rdceipt of
material cominc ^^^^^^^^^^^
In other words -— -gi-
■■iliiPIB
1297
1298
1299
UNOASIilFItu
1
2
3
4
5
6
7
3
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
sp«cifically excluded from any involvement with this
program?
UNGlASSiFIED
1300
UNGbASSIFIED
62
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
24
25
A Correct, except subsequently the Select
Committees of Congress allowed the Agency to do
verification.
Q As it turned out, it was the Agency personnel \AflnO
took on as part of their duties monitoring receipt of
these goods?
A That's right. And we received field
intelligence reports telling us — basically verifying
receipt of supplies.
Q Okay. Now, you mentioned one RIG meeting that
you attended that I asked you about in connection with
the hiring of Rob Owen. How many other RIG meetings did
you attend? '
A I remember one other one. I may have gone to
a third one, but I do remember one other one.
Q What was discussed at that?
A After my return from Honduras, the next day I
was told to report to Ambassador Abraras at the assistant
o f f i c e .^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^H
what I did was basically report at the RIG
as I have described to you
in my last discussion.
"■I— — — i— — I
1301
24
25
UNELASSIHED
63
Early to mid-February '86, right.
Q During that interim time period, there were
UNEbASSIFIED
1302
\imj&sm
64
1 some flights to Central America, weren't there?
2 A Not paid by NHAO, except one, and that was not
3 an NHAO flight per se. That was a flight paid foJ^^a Mr.
4 Gary Bennett of Fort Worth, who shipped a lot of donated
5 medical supplies and clothing to the Meskito Indians. He
6 had asked our office on repeated occasions to help and we
7 had not been able to help him.
8 He contacted his Senator, Senator Bentsen, who
9 was a member of the Select Committee, and the Select
10 Conunittee asked us if we could in fact pay for this. And
11 it was discussed in a RIG meeting that I did not attend.
12 I believe Ambassador Duemling harlled that and got
13 approval to pay for this.
14 I think I was asked by Mr. Walker and
15 Ambassador Abrams informally outside of a RIG situation,
16 and I described the Gary Bennett project. And also,
17 Senator Bentsen 's people also were inquiring and they had
18 the information.
19 And it was approved, and we just paid for that
20 one flight into the Meskito and he was able to get it in,
21 I might add, where ours were not. And it went directly
22 to the Meskito Indians.
23 Q Inside Nicaragua?
24 A
25 Q How did Dick Gadd first come to your
^^^IrAOOi
1303
mmmB
65
1 attention?
2 A I never met the man. Mr. Gadd I have never
3 met. I knew his name because it was discussed by
4 Ambassador Duemling and Mr. Bueschler, Phil Bueschler,
5 was the one that dealt with solely and wholly with the
6 contracting of air carriers. I did not get involved in
7 any aspect of that.
8 Q You were not involved in the hiring of Air
9 Mach?
10 A Air Mach or Conners, none of them. So I would
11 have to tell you that I'm not familiar with the details
12 of that, except that I knew that Mr. Gadd was one of the
13 people that was rendering some service.
14 Q Do you know how he first came to the attention
15 of NHAO?
16 A As I recall, and this is my best recollection,
17 is that Mr. Bueschler, subsequently I think Ambassador
18 Duemling, he was — I don't know whether the resistance -
19 - It was Mario Calero, because I know Mr. Calero, Mario
20 Calero, dealt with Phil Bueschler — if it came through
21 Mr. Calero or if in fact it was suggested indirectly, he
22 just turned up with a recommendation either by Colonel
23 North or the Agency.
24 I really don't know.
25 Q Did you —
UtKtASSIFIED
1304
UNCUSSIFIED
66
1 A My impression is one of the three, but I
2 really don't know that.
3 Q Did you during the time that Air Mach and
4 Gadd's company had a contractual relationship with NHAO,
5 did you know that there was any connection between Dick
6 Gadd and Air Mach and Oliver North?
7 A No, in fact I did not.
8 Q Did you know that there was any connection —
9 A I knew that he, Mr. North, knew him, knew
10 about him. Not that he told me, but Ambassador Duemling
11 led me to believe that in fact North was awara" of the"-
12 Gadd connection and had something to do with it, but I
13 don't know how.
14 Q Okay. Did you, prior to a time when some
15 individuals came to your office to complain about Air
16 Mach — and I'm going to get to that in a moment. Prior
17 to that time, did you have any information that General
18 Richard Secord had any connection with Gadd, Air Mach, or
19 any of the contra supply efforts?
20 A No, except that one time I was with Rob Owen
21 in the winter — as best I remember, we had stopped off
22 at Ollie's office, and I don't think we saw Ollie that
23 day — no, in fact I correct myself. I think we did see
24 him, as I remember.
25 It was a very brief meeting and we really
UN6tASSIFIED
1305
UNtASSIFIED
67
1 weren't able to really talk to Ollie. And then I
2 remember that -- maybe it was the spring. I don't
3 remember the time frame. But I do remember that he said
4 that he had to — there was a death threat on his family
5 or him.
6 Someone mentioned it. I don't remember
7 whether he said it or Owen said it; and that he had to
8 take his family out to a Mr. Secord, Dick Secord. It did
9 not click to me that it was General Secord, because
10 I didn't know anything about him except that I vaguely
11 remember some press reports. I was overseas in the
12 period of '83.
13 That he had taken his family out to his house,
14 something in that context. I don't remember exactly how
15 it came out, but it was the fact that somebody mentioned
16 that he had a death threat or his family might be
17 threatened, something to that effect.
18 But it wasn't clear to me, was it he or the
19 whole family. And it wasn't clear to me who Mr. Secord
20 was. But I believe that was the first time that I heard
21 his name.
22 Q Okay. Now tell us about the time when three
23 individuals came to your office to complain about Air
24 Mach?
25 A They didn't come specifically to complain
ONEtASSIFIED
1306
UNWSIFIED
68
1 about Air Mach. They came — these individuals, let me
2 first state who they are. It was a Mr., I believe, Ed
3 Dearborn, who identified himself as from TransAmerica,
4 some air cargo service on the West Coast, and Mr. Gene
5 Wheaton, and a Mr. Carl Jenkins.
6 And I was never certain what their
7 relationship to TransAmerica was, but they all seemed to
8 be like either pilots or cargo handlers. That was the
9 impression I had. They worked for Mr. Dearborn on some
10 contractual basis.
11 They came in primarily to ask — they just*
12 stopped into the office over in Rosslyn to ask about the
13 fact that, why couldn't they get some contract that was
14 being given to other people to ship things down to
15 Central America for the contras.
16 And I told them that it was already
17 established and this had been done in coordination with
18 the resistance, and there was no need for any other
19 contractor at this point or cargo handler. That was my
20 impression.
21 Ambassador Duemling was not in the office that
22 day when they came. So I told him, the most I could tell
23 him was that. If there was a need, certainly we would
24 let him know.
2 5 Then they went on to say that — it seemed
UimSSIFlEO
1307
WilS»D
1 that they mentioned that Air Mach and Gadd had this whole
2 thing wrapped up, and it was only for their sort of
3 exclusive contractual purposes, and why were they getting
4 all the business? And they thought it was unfair.
5 And then they went on to say that we should be
6 ^ aware of the connection of Mr. Gadd to a Mr. Richard
7 Secord. And then he asked me if I knew who Mr. Secord
8 was, and I said no. And then he said, General Secord of
9 Wilson-Terpil , I believe is the way he stated it, the
10 Wilson-Terpil episode.
11 And I said, I had not been in the States, hut
12 I had read something about that. And he said, well,
13 Secord had something to do with this. He mentioned names
14 like Kleins and Shakley, which at that point didn't mean
15 much to me at that point. Neither did Secord, quite
16 frankly.
17 But he said, Mr. Dearborn claimed that these
18 were all friends of Mr. North, and Gadd was a friend of
19 theirs, too, and that this thing had been cooked and
20 that's how they had gotten these contracts; and this is
21 what it really took to get contracts from the NHAO
22 office, that you had to know North. And that was
23 basically his complaint.
24 I told him I would look into it, but it seemed
25 to me that I wasn't the one to decide it. That was
UNetASSIHED
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1 Ambassador Duemling.
2 I subseuently later mentioned to Duemling,
3 Ambassador Duemling, that like so many other groups that
4 came in to ask for business — we had several consultancy
5 groups that would come in and ask us to be the medical
6 consultants, people from Washington and outside that
7 would call us, that would be recommended by members of
8 Congress — and I thought this was one more.
9 And I mentioned it to our political officer,
10 Kevin Whittaker. And I believe Kevin may have sat in —
11 and I don't recall this specifically — the end of this
12 conversation.
13 But nonetheless, it was mentioned in the
14 context that we had one other bellyacher that had come in
15 to complain about why they weren't getting contracts. I
16 don't recall exactly if then or later, in what context I
17 mentioned it to Ambassador Duemling that they mentioned
18 Secord, because it didn't sink in at that point on me
19 what exactly this connection was, until much later as
20 press allegations began to be leveled.
21 And then it was only in either May or June of
22 1986 when one journalist came and told me that he was
23 covering the Middle East and he said there was a
24 connection of some Middle East money and this group of
25 people and possibly the NSC, and if I knew anything about
UNWSIflED
1309
vmmm
1 it.
2 And I said that I didn't, but it was
3 interesting that I had heard this from Air Cargo.
4 Q Had they mentioned a Middle East connection,
5 those three people?
6 A Yes, they did. They said exactly, to come
7 back, they mentioned something about money coming from
8 the Middle East. But they weren't specific. They did
9 not give any specifics.
10 Q What did you take them to mean when they said
11 money from the Middle East? You mean to finance the ,
12 operation?
13 A Yes. I just assumed that they were getting
14 money to finance it.
15 But at that point, you see, my problem with
16 them was that they were very vocal about the fact that
17 they did not get the business, and that was their basic
18 concern. And I thought that they were basically using
19 this or exaggerating or inventing, I wasn't sure, saying
20 all this to discredit these other people so that they
21 could get the business.
22 Q Well now, you say that you had other people
23 that would come in to ask, why couldn't they get this
24 contract or that contract. You didn't have many people
25 come in and drop names like Wilson and Terpil and people
UNCLASSIFIED
1310
lINOWSSIflEO
72
1 who used to sell arms to Ghadafi and all that. That was
2 rather unusual?
3 A Yes. But it didn't register, as I said
4 earlier, on me who these people were, because as I said,
5 I wasn't in U.S. when this scandal came out. It was a
A
6 vague thing to me that I had read before, who these
7 people were.
8 Secord didn't mean anything to me. Only when
9 he mentioned Wilson-Terpil, I remembered them. But he
10 claimed that he was involved with them. He suggested
11 that Mr. Secord might be involved. He didn't say he Was.
12 Q How soon after the conversation did you
13 mention it to Ambassador Duemling?
14 A I don't remember. I don't recall that
15 specifically, how soon.
16 Q I mean, within days or weeks?
17 A It may have been days. I don't remember. He
18 wasn't there. We discussed it in more detail months
19 later, because then I felt, as press allegations came out
20 — it was only months later that we discussed it in more
21 detail.
22 Q But I mean, the original discussion with
23 Duemling?
24 A It didn't get into the details, like later.
25 Q Did you mention to him —
"Nwxife
1311
UmSSIFIED
1 A Because I basically focused on the fact that
2 they were very irate and that they had come in
3 complaining that they didn't have any business.
4 Q Did you mention to Duemling that they had
5 dropped Oliver North's name as somebody that was involved
6 in this?
7 A I don't recall that. I may have, but I don't
8 recall that specifically.
9 Q When these people talked to you, where did
10 they say that they were getting this information from?
11 How did they know what they were talking about?
12 A They said they had flown all over the world
13 and they knew who these people were, and that was it.
14 They really said this at the end of the conversation
15 before they left. They sort of hemmed and hawed, and I
16 couldn't figure out what they were getting at, because
17 basically they kept reiterating the fact that they were
18 not getting business handling cargo.
19 And it was only toward the end that they
20 mentioned — basically, the way I recall Mr. Dearborn
21 stating it, or it may have been Mr. Wheaton — I don't
22 remember which of the two, saying North is involved in
23 things he shouldn't be; I don't know what he's involved
24 in specifically, but he's got all these friends and this
25 doesn't make sense.
UNCUSSIFIED
1312
UNCIASSIFIED
74
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3
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5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
Q He didn't say where he got this information
about North?
A No, he did not, and I didn't ask him, except
they kept saying that they knew people in the trade of
cargo handlers and all this other business, which they
were, so I suspected.
Then I did mention it to Owen. I said, Owen,
what do you know about this.
Q How soon after?
A Maybe a week or two later. I don't remember
exactly when, but it was not like immediately. Some -.
weeks later I said, you know, th. ie guys came in here, I
don't know what they're saying, •.nat this is all about.
And he said, who is this. Gene Wr.eaton?
And he knew who Gene Wheaton was. He seemed
to know who they all were,
Q Had any of these people mentioned Robert Owen?
A No, I don't recall that.
Q Why did you discuss it with Robert Owen?
A Because I wanted to know, because they
mentioned Ollie's name.
Q And because they mentioned Ollie's name, you
UNetASSIFIED
1313
UNCLASSIFIED
75
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
knew that Owen was very close to Ollie and —
A It was only about two or three weeks later, I
said, this is a weird conversation; what did these guys
want? They were bad-nouthing everybody, and they came in
here bad-mouthing the people who had the contract.
Q What did Owen say?
A He smiled again. Rob was a very noncommittal
guy. He never would say yes or no. You were never sure
exactly what that meant.
But the only thing he described: Oh, Gene
Wheaton, he says, oh yes. I couldn't remember the first
name and he corrected me, or mayi: i it was Jenkins. I've
forgotten which of the two. And ha said, oh, yes, well —
I don't know which of the two, b-t they go way back.
And apparently, he didn't go way back with them.
Q He didn't say anything, though, like,
absolutely none of this is true?
A No, no, no. He just said they are just
bellyaching because they're not getting the money; they
have to come in here and bad-mouth people, I don't
remember him confirming it or denying it or anything. He
sort of laughed it off as guys who wanted a piece of the
ONttASSIFIPn
82-688 0-88-43
1314
UNetASSIFIED
76
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2
3
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5
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7
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25
action. That's how he put it.
In hindsight, you know, it makes sense, when
you follow all this up.
Q These people were -- I know this happened
toward the end of the conversation. But they were very
blunt about this group of people? I mean, they called
them scum and words like that, didn't they?
A Ves, they used words, pejorative terms, when
they referred to Secord.
Q Now, you mentioned a previous connection with
Mario Calero. Did one of them have a previous connection
to Mario Calero?
A Mr. Dearborn said he .-.ad talked to Mario. And
in fact, now that you mention Mario's name, I'm not
absolutely certain, but I remember that Mr. Dearborn
showed up in my office, I think, by the suggestion of Mr.
Calero. I'm not sure — Mario Calero.
Q In other words, they were there to see you?
A Apparently.
Mario
was the head of the logistics for the FDN, and my
impression was that Mario may have recommended that they
see me about a possible contract.
Q Were they there to see you or were they there
UNetASSIFIED
1315
ymssifiH
1 and you talked to them because Duemling wasn't there?
2 A I don't remember that. Maybe Calero didn't
3 mention me specifically, but my impression was that
4 Calero told them to come see us. But I know that
5 Ambassador Duemling wasn't there.
6 Ambassador Duemling usually asked me to see
7 people like that, that came in the front door, sort of
8 the walk-in traffic, soliciting contracts. And he just
9 had me talk to them and get rid of them and said, look,
10 that's not the way we operate.
11 Q Did Ambassador Duemling say anything about- why
12 Air Mach continued to be used by ;HA0?
13 A No, he never really mentioned that to me.
14 Q Did Duemling ever indicate to you that^^^^H
15 ^^^^^^Hasked him to continue to use Air Mach for a little
16 bit longer before terminating them? Did he ever tell you
17 that?
18 A No, he never did. I don't recall him telling
19 me that.. He obviously told me that, or at least he
20 suggested that ,^^^^^^^^H was happy with — well, the
21 resistance and the people that were dealing with him on
22 this.
2 3 And I don't know who was dealing with him on
24 this, quite frankly, because he dealt exclusively with
25 Phil Bueschler. I was never asked, as I stated earlier,
WNtUSSIFIEB
1316
UNCIASSIFIED
1 to deal with the cargo carriers. So I don't know, to be
2 honest with you, to get a read of what^^^^^^^^^Bnay
3 have told him or not have told him in terms of extending
4 Air Mach's or any other carrier's contract.
5 Q Between -- first of all, this conversation
6 when these people came into your office, I'm sorry, tell
7 me again approximately when was that?
8 A February, March, in there.
9 Q During that time period, did you ever have any
10 face to face discussions with Oliver North?
11 A I may have seen him. Yes, I'm sure I saw him,
12 but not on this matter.
13 Q What about telephone conversations during that
14 time period?
15 A I talked with him very little. I did see him
16 because — it must have been February, March. I don't
17 recall the period. We had breakfast maybe three or four
18 times, once at the Hay-Adams and then the rest of the
19 times at McDonald's near the White House because I
20 couldn't afford the Hay-Adams.
21 And we were joined by William Walker and
22 Lieutenant Colonel Gerald Clark, who is now in Honduras.
23 And basically, we discussed the policy, and basically the
24 discussions were around the fact of how was the vote
25 going to come out in Congress that spring.
UNWSIFIED
1317
79
1 Q Did you ever mention to Oliver North the
2 allegations that these people were making?
3 A I did not.
4 Q Okay. Now, frankly, I don't understand that.
5 If you were at all familiar with Oliver North and you
6 have a group of people in your office that are connecting
7 him up with a group of crooks that were once involved in
8 selling arms to Ghadafi, I don't understand why you
9 wouldn't mention to North: Hey, you know, people are
10 dropping your name around town and saying you are
11 connected with the Middle East and Secord and all this.
12 Why wouldn't you mention it to him?
13 A I don't know. It just never occurred to me,
14 frankly. I guess you would have to have been in the
15 situation. The personal vibes with these people, they
16 were just so — the way they came on so strong because
17 they wanted business; that my sole focus was that these
18 people, all they wanted was business and they were ready
19 to bad-mouth anyone so that we could give them the
20 business.
21 That was basically it. And I guess that was a
22 turn-off, and I didn't place the importance in hindsight.
23 I agree with you, it makes sense. But at that point the
24 reaction I had, the personal reaction I had to the way
25 they came on about complaining about why they didn't get
wmmm
1318
UmSSIHED
80
1 the business, and then the way they went about it, they
2 were very oblique and they weren't sure — they would
3 look at each other, and the body language and the
4 conversation — I was turned off.
5 Q Tell me briefly about the call you then got
6 from, I believe it was, Newsweek, later on about similar
7 allegations?
8 A It was, as I said, early, I think it was June.
9 I think it was June of 1986. A Newsweek reporter, two
10 Newsweek reporters, visited me. I had known them because
11 they used to cover Central America, and one of them was
12 now covering the Middle East.
13 He said he was on his way out to California to
14 see some people and he was around Washington talking to
15 find out if there in fact was a Middle East connection to
16 this, to the NSC. And he claimed that there was. And
17 this was when he raised — this is the second time I hear
18 this.
19 It must be around middle or late June of 1986,
20 that he thought that he had picked up something in the
21 Middle East and elsewhere that suggested that there may
22 be some involvement of Middle Eastern money. And he
2 3 mentioned the name Secord and he mentioned — I don't
24 remember him mentioning Shakley and Kleins, but certainly
25 he mentioned Secord, and that the NSC might be involved
UNttSIFIED
1319
Wssm
81
1 with that.
2 He asked me if I knew and I said no. And then
3 I said, as a matter of fact, you're the second person who
4 has ever raised this. This is the end of June 1986.
5 Q Tell me about General Singlaub. When did you
6 first meet him?
7 A General Singlaub I met, I believe — I'm
8 almost certain now — twice. He came to my office. Once
9 was — I take that back. He came to my office once and
10 called me a second time. I think it was a series of two
11 or three phone calls that same day.
12 The first time he came, he came — and I don't
13 recall the dates, but it had to be also in the March-
14 April period, in there. And he came and he told me that
15 he had been sen^ there by, I believe it was, Adolf o
16 Calero to find out if in fact NHAO could buy aircraft to
17 ship non-lethal aid.
18 And he claimed that he had found one used C-
19 130 in Arizona, and perhaps we could use that, NHAO, but
20 the resistance would acquire it and we would purchase it
21 with the $27 million.
22 I told him that, because Ambassador Duemling
23 had told us all that they had consulted prior to all of
24 this, the ability or the permission to buy aircraft, and
25 they said no and the Select Committee said categorically
UmSSIFIED
1320
UNCLASSIFIED
82
1 no, when they gave us permission to buy vehicles, land
2 vehicles, trucks.
3 So I explained to him that we could not under
4 the provisions of the legislation and the consultation
5 with Congress, so it was not possible. And then he
6 basically explained to me how it would be beneficial to
7 the contras.
8 I explained it later to Ambassador Duemling,
9 just told him. I gave him the explanation and Ambassador
10 Duemling was satisfied.
11 Q Did you reject the idea then and there in your
12 meeting with Singlaub?
13 A Yes, I said we could not do it.
14 MR. )(ANpusEN: What was the time frame?
15 THE WITNESS: March-April. I'm not certain.
16 BY MR. SMILJANICH: (Resuming)
17 Q Now, there is — and I don't have it with me.
18 There is a memo that was prepared of that particular
19 meeting.. And as I recall that memo, it relates that what
20 General Singlaub wanted was — well, can you — I don't
21 want to — if I tell you —
22 A I'll tell you the phone call. Maybe it
23 relates to the phone call. The phone call was later and
24 I believe that was in the summer. It was June, July. It
25 may have been July, at the beginning of July.
mmvsm
1321
DNdJ^SIFlEO
83
1 Q Excuse me. Let me stop you. Are you going
2 to start talking about the Lady Ellen helicopter?
3 A Yes.
4 Q No, I don't want to talk about that yet.
5 On the C-13 0, do you recall how General
6 Singlaub was suggesting that the plane be paid for?
7 A Yes. I believe he asked us that we pay for it
8 out of the NHAO money.
9 Q Do you recall him saying something about a
10 million dollars? I forgot what the memo said.
11 A I remember that it was in the order of a
12 couple of million dollars at least, the cost. I don't
13 remember the exact amounts.
14 MR. jJanDUSEN: It said $2.5 million was the
15 cost of the plane, but he wanted a million dollar down
16 payment.
17 THE WITNESS: Yes, that sounds like something
18 he would have said. I don't remember exactly how he
19 would have said that, but I remember it was 2, 2.5, the
20 total cost.
21 But I just rejected it out of hand, because I
22 knew that we could not purchase anything like that
23 remotely.
24 BY MR. SMILJANICH: (Resuming)
25 Q Tell me now about this telephone conversation
UNK^SIFIED
1322
UNfittSSM
84
1 with regard to the helicopter?
2 A I believe it was June or early July '86, he
3 called me — before he called me, I will tell you what
4 happened. In the morning I got a call from Nestor
5 Sanchez, the deputy assistant secretary of defense, who
6 said that Jack Singlaub would either be coming by or to
7 call me.
8 And I remember it was a telephone call, and it
9 was basically, the problem was that the Lady Ellen had
10 been detained by Customs in McAllen, Texas, because there
11 was some problem that did not satisfy the Customs people
12 in terms of the export of this aircraft, because there
13 were some hard points — I believe that was the term he
14 used — on the aircraft, and there had been some
15 modifications made to this helicopter.
16 And Customs was holding it in McAllen, Texas.
17 And he asked me if in fact I could make a phone call to
18 be helpful and explain to Customs that this was for
19 humanitarian aid from the State Department's Office of
20 Nicaraguan Humanitarian Assistance.
21 I asked him why he couldn't do it. He said,
22 first of all, it was DOD and after all it was in the
23 scope of humanitarian aid, that it would be used as an
24 ambulance. It had been described, actually, by Adolfo
25 Calero prior to this, because Adolfo Calero had asked
UmSSIFIED
1323
mmim
85
1 Ambassador Duemling to pick up the repair tab on this or
2 the modification tab or something to that effect, and
3 Ambassador Duemling had said, no, we couldn't deal with
4 aircraft like that, we couldn't pay for anything like
5 that.
6 So when Nestor told me that Jack would be
7 calling me, Jack Singlaub, I said fine, but I don't know
8 why I have to do it. He said: well, you know, you can
9 do it as a favor.
10 Well, General Singlaub called and said, I
11 believe, can you help us. And I said: Well, I'm not"
12 certain we can do anything, frankly; I'm not certain if
13 the State Department has a role in this.
14 Ambassador Duemling wasn't there at that time.
15 I think he was out that day. So then I wondered about
16 this, and I placed the call to McAllen, to the Customs
17 people, just to find out what was the circumstances
18 before I proceeded.
19 I then called Bill Walker and advised him that
20 I had this phone call and I wasn't sure what to do. And
21 he said, well, find out more about it before we proceed.
22 In the meantime, I said, well, you know, this thing is a
23 little bit too wacky, and so I called North.
24 And North didn't return my call right away,
25 and when he finally did it was maybe a few hours later.
UNEtJISSIFIED
1324
UmSSIFIED
86
1 something to that effect. In the meantime, I had placed
2 a call to Customs based on my conversation Nestor and
3 Bill Walker and of course Singlaub, and then I called
4 North.
5 I said: What do you know about this thing?
6 And he said: Who asked you to do this? And I said:
7 Well, frankly, Nestor put it on me, and then Singlaub
8 called me. And then North exploded. He went into a
9 bunch of unmentionableness, describing Mr. Sanchez'
10 competence and his political sense.
11 And he said that he should never have involved
12 the State Department in this, what was wrong with Nestor,
13 and not to get near this thing because it was not a
14 question of something the State Department should do.
15 And then at this point he told me, he said: Frankly, I
16 don't want to discuss this because I have my own —
17 that's the first time I ever had any indication that he
18 might have a legal problem.
19 He said to me — in fact, I believe that was
20 the last conversation 1 had with Oliver North on the
21 telephone, was in July, I believe, late June or early
22 July.
23 But he said: Look, I can't even begin to get
24 into this, because I am under legal counsel, I think he
25 used the term, not to even discuss these things, and get
UNcassiFiFn
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Wttssm
87
1 away from these people because they're going to get you
2 in trouble; and Nestor should be damned for what he did.
3 Q He was also mad at Singlaub, too?
4 A Yes, both of them. He was mad at both of them
5 for doing this and bringing the State Department into
6 this.
7 So then —
8 Q Before you leave the conversation — are you
9 going to leave it?
10 A I was just going to say, what happens when the
11 Customs guy calls me -- the Customs guy calls me and fie
12 asked me what was the problem. And at this point I just
13 said: Look, I'm from the State Department, identified
14 myself, and as I recall I said to him: You know, I
15 called about this helicopter.
16 And he said: Well, we've got it; what about
17 it? And I said: I just wanted to know; I really have no
18 interest in it at this point. And I thanked him for
19 returning my call, and that was the end of the
20 conversation.
21 Q Now, going back to your conversation with
22 North, why specifically was he upset with the fact that
23 Nestor Sanchez and Singlaub were asking you to make this
24 call to Customs?
25 A He did not want to elaborate. He was very
UNCtltSSIFIED
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KNWJSIFe
1 curt and terse, and the only thing ~ he was very angry,
2 and he said he could not discuss things because of his
3 own legal situation with me, and that was it.
4 And he said: I can't tell you anything^ what
5 to do. He was furious at the fact — or he just told me
6 to stay away from them. He thought this was totally
7 ridiculous, that they had called the State Department to
8 ask them to bail them out on this question.
9 Q Did you have the impression from that that
10 this helicopter must have something to do with non-
11 humanitarian purposes, because of North's comments?
12 A No. Then I got back to Walker and I said:
13 You know, this thing happened; North is furious. And I
14 don't know whether North ever raised it with Nestor
15 later. He said he was.
16 The only thing I knew, because it had some
17 hard points on it there was a question of Customs and the
18 Treasury people to determine, and State was not to get
19 into this because it was obviously — if in fact it was
20 determined it had some hard points and State was in it, I
21 think that was the impression I got, legally we might
22 have a problem.
23 MR. j^ANDUSEN: I'm just curious. Was North
24 mad at the fact that you were dealing with Singlaub? Was
25 he mad at the fact that this helicopter had hard points?
82-683 1326
IINCLKSSIFIED
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UNcyissiriEo
1 THE WITNESS: No, no. He was just mad that
2 they brought it up with the State Department and called
3 me, that Nestor and Singlaub<i particularly Nestor, he was
4 most — he took it out~ on Nestor Sanchez mostly. He
5 should have never asked me to do something like this.
6 BY MR. SMILJANICH: (Resuming)
7 Q Okay. Let me move on to another subject here.
8 Did Felix Rodriguez ever describe for you the particular
9 meeting he had with Don Gregg at the vice President's
10 office?
11 A Yes. I don't remember — I think it was when
12 he first came to Washington, that time he visited me, the
13 first time he visited me in Washington. When he called
14 me, he told me he had been at the White House and had a
15 meeting with Don Gregg, and he had met with the Vice
16 President. - ^■--**ite
17 Q What about in late 1986? Did you ever hear
18 from Felix Rodriguez that he had had a meeting?
19 A He called me to find out how I was feeling,
20 and he said he had been at the white House and had had
21 meetings with Don Gregg, his friend.
22 Q Did he say why he was meeting with Don Gregg?
23 A No, he did not.
24 Q Did Oliver North ever talk to you about any
25 complaints Felix Rodriguez was making to the Vice
mmm
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UNCLASSIFIED
1 President's office?
2 A He never mentioned it to me, except the only
3 time I saw Oliver North mention or do anything with Felix
4 Rodriguez was the time we were in El Salvador, when he
5 asked him to leave the room.
6 Q Did Oliver North ever tell you during any of
7 your association with him that he had — strike that.
8 You just mentioned when you talked with Oliver
9 North about this Nestor Sanchez-Singlaub matter that he
10 mentioned having gotten legal counsel?
11 A He did mention that to me, and that's why he
12 couldn't expand. The reason he mentioned that was
13 because that's — I don't want to continue this
14 conversation with this sort of topic.
15 Q Did he put a name to the legal counsel?
16 A No.
17 Q Did he say it was White House legal counsel?
18 A No.
19 Q Intelligence Oversight Board?
20 A My impression was it was personal. That was
21 the impression that was left.
22 Q But he didn't say that, did he?
23 A No.
24 Q He didn't say it was a private attorney?
25 A No, he did not use the word "private" or
UNIHASSIFIED
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UNCLASSIFIED
91
1 anything like that. He just said by advice of legal
2 counsel, something to that effect.
3 Q Did he at any other time ever tell you that he
4 had obtained opinions from lawyers that his activities in
5 Central America were legal? .. -
6 A I'm trying to remember when he may have said
7 this. I know he said it to me at one point. He said —
8 Ollie said at one time to me, and I don't remember if it
9 was at the beginning or later on in one of the
10 conversations, or it may have been at breakfast, he says:
11 Hell, before this is all over I may be well in jail, '
12 something to that effect, but in a teasing way. He said
13 that in jest, saying things like that.
14 Q What impression did you have as to what he
15 might be doing that he would be making such a comment?
16 A I really don ' jfejknflfptr ^^^gfe --
17 Q I mean, if I were having lunch with you and
18
19 well, I wonder why.
20 A Well, it was very clear, you know, when we
21 dealt with this issue of NHAO and the way we conducted
22 this operation, it was overt and we knew there was
23 another side of the house. Somebody was doing it. We
24 w«rfifc-jtol<fc it was.j^t tlMRCIA, except the verification,
25 because they couldn't do anything with it.
UNCmnED
nna ^^ oo A 4
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We knew that it was not any agency of the U.S.
government as far as we knew. But we did not ask because
it was very compartmentalized, and Mr. Calero would just
tell us that he had money from different sources and he
had friends that were helping him.
My impression, particularly in the initial
part, initial phase of NHAO, was that North helped
getting fundraisers or benefactors. But I didn't know
who they were. I always suspettfiBI^^ZPScmuae I ha±^a lot
of political types would say, oh yes, North spoke out at
a certain place in Texas or California.
So I thought it was just basically that he
would brief people on Central America and these were
fundraisers. _ Bu^^^didjiot know tiift^ynamics or anything
llke^hitl
the only ort^^^tvi^HB^iiebrJSMII^^HK witai^
general terms. He said that he had benefactors in the
U.S., it- was private funding. And my impression was that
Colonel North helped him in some way, but it was never
clear to me how.
And so it- was always sort of understood that
there were areas you didn't ask about. It's like dealing
with anything in the intelligence community. You know,
it's compartmentalized, it's a need to know basis. This
UNttASSIFIED
1331
UNCUSSIFIED
1 is the way we were treated, too, in NHAO, on a need to
2 know basis.
3 Q So for all those reasons, that's what you
4 thought North might be referring to when he made a
5 comment about possibly going to jail?
6 A Yes. When he said that, I didn't know whether
7 he was lying or what he was doing. Obviously, I may by
8 then have known of the allegations made against Rob, and
9 of course I knew of the initial reports on North in the
10 summer of '85. I had read those, and it insinuated he
11 was doing more than fundraising.
12 But it was never clear what he was doing. And
13 certainly I never had a discussion about those mechanics
14 with him.
15 Q Did you ever hear in the fall of 1986 that
16 certain groups of private benefactors were looking to see
17 if their assets could be purchased by the Agency with the
18 new aid money that was coming -into effect?
19 A I did not. I never heard that. I never heard
20 that.
21 Q One last thing. In connection with the RIG,
22 you have talked about two RIG meetings you went to, and I
23 think you said there might have been a third?
24 A There might have been a third.
25 Q You don't recall what was discussed at that?
UNGtASSIFIED
1332
UNCtASSIHED
94
1 A I'm trying to remember. One was the Rob
2 issue, one was the issue of --
3 Q
^^^^^^^^^^^^^^^^^^^1 to
5 remember what the third one may have been.
6 Q Well, don't rack your brain too much.
7 A I think what it may have been is the fact that
8 there was impatience on Mr. North's part that the
9 resistance was complaining about our office to Colonel
10 North that they were not getting the stuff fast enough.
11 I think we were asked to go explain what the
12 mechanics were, the problems we v«re encountering.
13 Q How many people averaged being present at
14 these RIG's?
15 A The one that I remember was almost full-
16 fledged was the one I attended^^^^^^^^^P^and I
17 remember distinctly that was the 4th or 5th, something
18 around there, of October. And it looked like at least a
19 dozen people, ten to twelve people anyway.
2 0 Q Okay. Were you ever — and you understood
21 that the RIG was the Restricted Inter-agency Group?
22 A Right, the policy. You took up issues up, and
23 when they weren't clear they would consult the Select
2 4 Committees.
2 5 Q Were you ever aware that there was a smaller
UNMASSIFIED
1333
UNIil^SIFIED
1 grouping of the RIG composed of just three people, that
2 dealt with very tightly held matters in connection with
3 the contras?
4 A No. But there was a suggestion that that
5 might be going on, just by the way the people met before
6 and after the RIG. Somebody would go in ahead of time or
7 stay back. That's the only suggestion I had from that.
8 Q And who were the members of this smaller
9 group?
10 A That might have been the smaller group. I
11 don't know if that's the one you're talking about, but
12 the only one that I saw would be .ike Elliott Abrams,
13 ^^^^^^^1 >^ 0£tver i^mth'^B-z that's n^t^o-
14 tha^was ^e grrop.
15 ^^ ^.sA ^^Ss^w^SsstaB^ But.
17 the"only "^a^K:.^^~ei^tajjg:^^^l£-gc
18 anySir
19 -^-^Ht i uiidawSnd. Bvi^la5^»ft^^tt%add
20 people in^'^h^tifeB _^^rtipit h<aprT!^d.-that^tii«
21 sraa^er gr^yEhg, 'jr^giciaOrtittp^^. am^h^"^^^!
22 three. Anti_
23 perception?
24 A That was my sense, yes.
25 MR. SMILJANICH: Those are all of ay
St^i
ar-^^^ -^
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questions.
MR. KOJM: I probably have a few.
BY MR. KOJM:
Q At the time of your first trip to the region
when you were NHAO^^^^^^^^^^^^^^^^^^^^^A did
you meet any leaders from the southern front or any
Indian leaders?
A Brookland Ri^ri'^iame to see me, I think in
the middl«"of '83, maybe May of '83, somewhere around
there, that I remember. The reason I remember is the
officer that brought him to my office left at the end'of
May, so it had to be — it was r.ght before he left. And
I met Brookland Rivera.
I never met Mr. Faggoth, and Brookland I just
met once. He came to my office.
Q Your trip
A Oh, I'm sorry. NHAO, the Indians, yes, I met
with Mr. Roger Herman!
Q Did you meet with Negro Chamorro?
A Yes, I did. I met with Negro Chamorro. I
don't remember — I believe I didn't meet Wycliffe until
Washington or Miami, but I did meet with Negro Chamorro
in the presence of Mr. Carlos Ulvert on that trip, after
or maybe it was the other
way around. I'm not certain which came first.
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WMssife
But in that same trip, l did meet with the FDN
and the southern front people.
Q And the Indian leaders?
A Yes, and one Creole, Mr. Archibald — no, it
was Teofolo. I don't remember whether it was Teofolo or
Archibald. The names I confuse. ~-
Q Did Amba&sador Daenling~ask you to meet with
these individuals? *"—
A No.
arranged for a meeting with th» resistance to .^plain to
them how this would work, andr=^explailied--"46'-^ea tha^' it
wasn't certain yet i f^s "i»uid "h ve a'iechanfam. And
they gave me their sq3^ of bill -f particulars-:^ terms
of what they wanted in teairs ot food. ^.^
ador^r^LMhM-ng;. suBse^itRit to
your retyrn?
A >^^ȣ
Q JlJboufc j^^^me ^
A £^Witt^|^. tba,. pol^^cp th<ire.-\^, ._~ .,.
Q Okay. Moving up to 1986 and Rob Owen, do you
recall ever receiving telephone calls from Rob Owen from
the region when he VKs traveling -^wn th«»«?
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98
A Yes, he called several times!
I don't remember him calling^^^^^^^^^^^^^^^B but he
called sometimes, because we would leave calls to ask him
to come up, that we needed a report, or get back,
Ambassador Duemling wanted to convey something or other,
particularly in the period when there was concern about
how money was being spent!
And he would speak to me or Ambrosio Ortego or
Ambassador Duemling.
Q Do you recall any time urgent matters, why he
would call you rather than just not tell you or submit a
report on his return, why he would initiate a call?
A Sometimes he would stay later than he was
supposed to. He would call and say, I'm not going to be
back until such and such a date. That was one of the
reasons.
But it was never — well, I can remember one
time he did call from^^^^^^^^^^Hwas a problem with
refrigerators. They were kerosene refrigerators and they
couldn't get the kerosene started or the fire started on
them. They wouldn't light up.
And he stayed, and he himself took them apart,
three or four of them. He called later and said, that's
why I was late, or I'm going to be late. I don't
remember. It was something to do with that. I remember
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that phone call.
And there were other ones f ron^^^^^^^^^lthat
would just say: I've been trying to get my wife; would
you tell her I'll be back on such a day, or something
like that.
Q When Rob Owen's contract terminated at the end
of May in 1986, did you have any kind of windup meeting?
A I was sick. I was in the hospital, and then I
didn't come back until the middle of June. He had met
with Ambassador Duemling, so he may have had one with
Ambassador Duemling.
^- ■" I only Mlt-^ftim- later hen he came to lunch.
He was already out* of the office . " ., 55:
Q t^en y^ were out of the of fd^e with ^ur
illnesfi|gdEr#a9l£e^il ^^- *- — ■■'-'^^■^^♦■^t»-,Ahafc.--«a<t ^
some tlml
dea _ .^^.., ..-^^^ ^ ,-3--
A ^ m^ I I II I Tiiiii^r |i ^^"Wmix ji^hii^,
but he .^4 ^^^".iMS^^^Mi^Mifet £^aM3^tae'\rtis vary
down. He was trying to get this job. He didn't have a
job immediately. when I said earlier that he went with
the 5^3titut^- I remember he did get the job in the
UNUSIFIED
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suamer .
I remember he was trying to find a job and he
had — you know, his wife was concerned about him. And
we would just talk philosophically, in that he felt — he
was very down on the whole prospects "of the movement, of
the project, or whatoyer he called it, the contj^
project, and that it was not goincf. to iunctioif^ecause
politically it was a mess.^ .rz- ^^^ ^'^
We had long philosophicc^l ~§i*eussi^s eagthat.
Q Backing- Ajp br¥Sly hereon yo«* trtf^n
December of 1985"," that waas^it oi3S-<fa5C^tr4
A Went ia. t^ morfES^, ame'~5aSi^hatT^evening.
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Q Okay. Two questions and I will be done. Does
the name Elie Krankowski mean anything to you? Someone
who works at the Pentagon?
A No. I may have heard it. I don't recollect
it at all. I can't put it in a context.
Q And^^^^^^^^^^^^whom you mentioned earlier
were you aware of any contract from NHAO to
a member of his family?
A No. A member of his family?
Q Yes.
A No. We had — well, _irst of all, there was
no contract. What they did, the mechanism, as you well
may know —
Q To the bank accounts?
A They would send their invoices through the
resistance, and it was vetted through UNO, FDN-UNO. And
they were vetted with certain signatures, and that was
done. Ambassador Duemling was normally the one who
approved all of this.
But it had to be approved by the people under
him that vetted this: Ambrosio, Phil, and Larry Dolgoff.
And then it was all — we took their word, because there
were just stacks and stacks of receipts in Spanish. And
UNCLASSIFIED
1340
ilNCL4S$IFIED
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what they would do is bring the receipts up here, and
they would vet it and we would figure out how much it
was, and then we would pay.
But there was no contract with any one
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UNGlASSIflED
But I never knew of any relative --
Q Receiving payment?
A Not from our office.
BY MR. )(ANpuSEN:
Q Some general questions. Just to start off
with, you indicated during the 'a3 to '85 period at the
beginning of this session that you ware fromJiiBni to time
acting DCM in the embassy? ^^ '3f
A Yes. ■ ^_-, ~ : -'-^
« ff" Was that because there was no DCM?
A The DCM would be — e.ther the Ambassador or
the DCM would be on leave. One :f the two would either
take a two month leave or a vacation, Christmas vacations
or their ^^M_J.eaye, which coul<Ls|S3*^*4* .^.4W^«ht^ weeks.
And so_^ vm^^raj^ ^^^igl^^^ic* r^^^^^AOB the
j7'-*- . jj^» -^ -SIS..- ~'5^~_ j^^
third ranklR^^'^ ^^ W _ .„ -r^
^jo ^^^fe- asked " "to b^^e deputy a^lag ^36.ef -
- deputy chi^^gf mtaaion . ' ^^-^' _„ '~--. ;.^- - "l
qT^ 4»as you^r— "in th^^^^^Hfatusi^your;
obviously was theg^st of anyboi^r in ^b
'^fP=- ^'wouid say UpwaHrrr-^^^''^ ^
Q And although you were public affairs officer,
you were also an important liaison for Ambassador
Negroponte and everyone else in the embassy?
UN6tASSiriED
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A Yes. That was one of the reasons, I believe,
I was asked to stay on. Normally you spend three to four
years, maximum of four, but three is at a hardship post
like that. Because of my relationship with members,
particularly the civilian branch of government, the
President and several ministers of government were
personal friends of mine that I had known before they
were elected or appointed.
And Ambassador Negroponte felt that that was
useful in terms of conducting bilateral relations with
Hondurans.
UNCa^SIFIFR
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Q I want to focus for a minute, when you came
bacJc to this country, on your relationship with^^^^^and
North and the Agency while you were with NHAO. You
indicated that you met with Oliver North six to ten times
while you were —
A I saw him in Honduras, saw him or talked to
UNey^SIFIED
1344
UNCUSSIFIEO
106
1 him.
2 Q Six to ten times. How many times would you
3 guess you met with him after you =ame back in the year,
4 say, between July of '85 and August of '86, when you
5 assumed the public affairs position? Would you say you
6 met or talked with him 50 times?
7 A No, no, no. I would say I met with him maybe
8 three times in his office in the White House.
9 Q Or were in meetings with him?
10 A Oh, yes. Well then, maybe three RIG's and^
11 then that one trip down there, three or four breakfasts -
12 - maybe 20 times.
13 Q 20 times?
14 A Maybe 25 times.
15 Q And you talked to him numerous times beyond
16 that?
17 A No, he wasn't one to get on the phone and chat
18 with you.
19 Q I mean, you called him on Singlaub. Did you
20 call him on other occasions?
21 A Yes. I'm trying to remember — well, I
22 remember one time after we had the — I believe it was a
23 phone call that had to do with Rob, whether Rob had —
24 whether RIG had agreed or Duemling agreed to do it. And
25 I said, well, RIG is going to decide that.
UNeUSSIFlEO
1345
DNMSra
107
1 Q Before the RIG meeting?
2 A Yes. And I said, look, it's going to be taken
3 before the RIG.
4 Q So maybe you had between phone conversations
5 " meetings with North or meetings, small meetings in which
6 North was present. You may have seen him well over 30
7 times in the course of that year?
8 A Seen him, yes, 20 to 30 perhaps, yes. I'm not
9 certain of that, but in RIG's, trips, breakfasts, and
10 meetings where I went to see Burghardt and I ran into
11 him, and I went with Owen, yes.
12 Q How about the CIA during this period of time?
13 A The CIA — Duemling and I went every time,
14 except once I had to go out there because Duemling was
15 not here. But Duemling and I would go out and meet with
16 the Central American task force people.
17 Q Once a week?
18 A It would sometimes go once a week, sometimes
19 every two weeks. And that was basically — it tended to
20 end — it was very sporadic towards the last three or
21 four months.
22 Q The last three or four months being April,
23 May, June, or June, July, and August?
24 A Well, May I didn't go, and June hardly any. I
25 think I went there one or two meetings after May 1st. I
UmSSIFIED
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may have gone to one or two meetings and that was it.
And before that it was almost biweekly. It wasn't
necessarily weekly.
There was no real schedule on it.
Q ^^^^^^^^^H ^°^ well did you know him?
A Well, I have met him once before
Q And you did not see h-.i again until the
December '85 trip?
A I don't remember seeing him until I came to
NHAO.
But that I really ever talked to him, that was
lin January of '85. And I did not see him
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ONCWSSIRED
109
again until when I went to NHAO.
Q And then you saw him in RIG meetings?
A I saw him in RIG meetings. I saw him in the
meetings I attended with Ambassador Duemling at the CIA
quarters.
Q And then you went down with him in December?
A Right.
Q On that trip. Did you see him after that?
A After the trip, yes. I have seen him in the
Department in the halls. We have said hello. And then I
saw him certainly through the spring of last year, and in
the summer it was maybe two timej I saw him.
I had not seen him. X ran into him one day
when I went for a briefing about two months ago over at
the CIA. I didn't talk to him. I went to see one of his
Q Now, Owen. How many times in the course of
your year with NHAO, how many times do you recall meeting
with Owen or talking to him?
A When Owen was in town, he would come in about
every other day. He might be out of the country one
UNetASSIFIED
1348
110
1 week, one day — 1 mean one week out of the month, maybe
2 two weeks sometimes. But at least two weeks out of the
3 month, and he would come in every other day, or he would
4 call Ambassador Duemling.
5 He would be working with Project Hope or he
6 would have one of the contra doctors up here, and
7 beginning particularly in December, January period, he
8 spent a lot of time with Project Hope, organizing that
9 shipment.
10 Q But his trips down there, he was taking a lot
11 of trips down there, presumably. Would you say that bne-
12 fourth of those trips dealt with NHAO or all of them
13 dealt with NHAO?
14 A We had trip reports on the ones we paid for.
15 He may have taken other ones that I'm not aware of that
16 he paid for out of his pocket. But right now my
17 impression is that we paid for all the ones during that
18 period that he was on contract to us.
19 Q Did you pay for all the trips he made?
20 A My impression is that we may have paid for all
21 of them.
22 Q You may have paid for all of them. How many
23 trips of his do you think you paid for?
24 A I would have to go back in the files and find
25 out how many trips.
limSSIHED
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Q Do you think it was 15 or 20?
A No, I think it was anywhere from eight to ten.
That's my ballpark figure right now, at most.
Q You said that we all had knowledge of what the
other side was doing. Your phraseology was, we all know
there was another side of the house, that something was
going on. When did you start to see that or feel it?
A Oh, about the beginning-of '8*r isaYticularly
after February^when we started thtf^ shlpmslgt.. ItJ^tasn't
clear to me when we started_-b'flhgiag staftf bac)'
in Fabs^ETT^.
Q.-^ -Was i^ a iegistica^su^ply nework?'^as it
offhanded conunents -about, tvpm p-iople that you dealt -"
with?
^-"^ .:--:M^^fr^ tl:
would niD^_^^p^^B|Hgp4^4fi£Sj
ottt#r opftgatlSSB?^Jut^i
abo^ tl^-but he did n(5t,.wa^fe' taii^|^»t.*d^.;g='
Q ■ ArsBFyet , ittr ali'^eSSROse
him, he never? ^^"""^^^^ ~ .-'
Under sworn oath, he never mentioned to me once.
Q Were you surprised at that?
A I wasn't sure at first. At first it didn't
UNCLASSIFIED
1350
UNCU^SIFIED
112
1 concern me. In the last six months, because when I began
2 to ask questions about the allegations, the press
3 allegations, and press reporters would make comments
4 about it, then I began to be concerned.
5 And then Bob was also telling me — we would
6 discuss. Bob Duemling and I, that in fact he may well
7 have another agenda. And Bob told him and I have told
8 him, and particularly Bob on several occasions, that if
9 there is another agenda and if you become politically
10 embarrassing to us, we're going to have to let you go.
11 Q Was this in June and July?
12 A No, this started in the very beginning. Bob
13 told him —
14 Q This goes back to?
15 A The very beginning.
16 Q October?
17 a" flMfeaft^MHjl^^ - JWit thfl^-^^was repeated,
18 and when I first heard it I said: Be careful, you know
19 what the Ambassador ha^^^-feim — tol<rYO^ir-.Xo^fenow ,
rss^
-'?r^-'
20 What t^e ^jfe«sadjgg^t« tegld./j|a>n. ■ t hate, if y^ are
21 involved in somet^lcrtha1^is'i»t ££kad»sd tcf%s,;^6u may
2 2 well be out or#th»- stH|pt^ ,-;?^ "" -'^^-. -^f
2 3 MR. KOJM: When was that?
24 THE WITNESS: That was when I first heard —
25 BY MR. )(aN£USEN: (Resuming)
\Mfmm
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113
1 Q Related to that is, when did you first hear
2 about the falling out between the FDN and Owen?
3 A Oh, I remember that he told me about it in
4 January or February, January or February, that he had a
5 falling out. And '-^en of course, the FDN people, Mr.
6 Mario Calero was making derogatory comments about him,
7 and I would ask Mr. Calero why he felt that way. He said
8 he couldn't trust Rob because he was treacherous, some
9 word like that in Spanish.
10 Then I asked Rob why there was bad blood, and
11 he said: They don't like me because they think I am -,
12 against them.
13 Q Did Owen have the reputation of being North's
14 boy?
15 A I think that was generally — yes.
16 Q Was that part of Calero 's problem?
17 A I don't know if Calero — Mario never
18 mentioned it to me. He may have to somebody else. I
19 don't remember him saying that in those terms.
20 MR. j^ANpUSEN: Chris, did you have a follow-
21 up?
22 MR. KOJM: The date when you and Ambassador
2 3 Duemling spoke and when you warned Rob Owen?
24 THE WITNESS: Well, he told him from the very
25 beginning, October-November, that he told him, I think
UNDl^SIFIED
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1 when he discussed — Ambassador Duemling told me that. I
2 was not present in the first discussion, but Ambassador
3 Duemling related it to me and Rob mentioned that the
4 Ambassador had been very adamant about that, be careful.
5 That was in the beginning, October-November.
6 I'm not sure when exactly. Then when I heard the first,
7 the allegations of the press, as I recall, when I
8 mentioned to him the AP's suggestion that he was present
9 at some arms deal in San Francisco with Mr. Calero,
10 Adolfo Calero, I said: Be cJireStl, Rob; if this gets out
11 of hand, if you're in the wrong place at the wrong time,
12 you'll get in trouble with us, and this could not be
13 advantageous to any of us.
14 MR. KOJM: This was in the spring of '86?
15 THE WITNESS: February, March. I don't
16 remember. Something like that. I don't know exactly the
17 dates. But it was basn^ Oi^ v^g^NraS^^ B^Bred to me by the
18 journalist from AP.
19 BY MR. ^ANbuSEN: (Resuming)
20 Q During the NHAO period of time, did you report
21 exclusively to Ambassador Duemling?
22 A I did.
23 Q You didn't report to anyone else in the State
24 Department?
25 A Only when Ambassador Duemling wasn't there, to
UmSSIFIED
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UNCLASSIFIED
115
1 Bill Walker.
2 Q And you didn't report to anybody in any other
3 part of the government except what you reported to
4 Ambassador Duemling?
5 A I was not ever told to report to the CIA, nor
6 to Oliver North, nor to the NSC, nor to DOD. The only
7 one I saw was Ambassador Duemling and there was Elliott
8 Abrams or his deputy, Mr. Walker.
9 Q On the three individuals — Dearborn, Wheaton,
10 and Jenkins -- who came to see you, you indicated you
11 weren't sure when you talked to Duemling about it, but
12 that several months later you had a very full discussion
13 with Duemling?
14 A Well, with hindsight I remember I said — in
15 fact, we discussed it several times since then.
16 Q This was after Air Mach lost the contract?
17 A I don't remember if Air Mach lost it. My
18 impression was that we just came to an end in May or
19 something like that. It may have been that we didn't
20 give them any more.
21 Q Strike that. You started up with Mark Air?
22 A Now that's mixed me up. Mark Air, Air Mach.
23 Gadd is Air Mach and Mark Air — my impression was that
24 Mark Air was only a couple of times. I don't recall that
25 it was more than that.
mmtm
1354
mSSIFIED
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20
21
22
24
25
And the only reason that focused on me is a
press question, because Anchorage News called me because
they had some journalists that were complaining about
some operation down there, and they had not been paid and
they apparently didn't get the contract, and they made
some allegations of what they were doing down therS.
And I was asked to comment on that.
Q In terms of the problems that NHAO had, just
philosophically looking at that period of time, would you
UNetASSIHED
1355
1
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3
4
5
6
7
8
9
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say that the logistics mechanism was the most serious
problem, the lack of a presence|^^^^^H^^| the
comingling of funds was the most serious problem, the
problem of cash transfer, the scheduling of flights?
A I think the most difficult thing was, one, our
inability to monitor, our office to monitor on the ground
continuously. By the time we were able to get someone on
the ground, it was the end of February. Ortega had only
three or four trips. That was nowhere near enough.
So during that period when we weren't able to
get our stuff from the States, that's when a lot of the
stuff was bought, December, Janu ry, and most of
February, virtually all of November, December, January —
almost four months.
A considerable amount had already been bought
in ^fe- ba#Tii>iJgMiSaib3;fe..to gjj^
■h "^^
in. count:
That made
it almost impossible to have a very effective
accountability of this.
The other thing was the lack of dedicated bank
UmSSIFIED
1356
UNKASSIFIED
118
1 accounts with suppliers. I think we should have been
2 much more centrally controlled, where you could see money
3 moving from the states to the region, that you could
4 account for it.
5 I think those are the two fundamental flaws in
6 this program. Both really were limited as to what we
7 could do.
8 Q Comingling of funds?
9 A Comingling, because you didn't have the
10 dedicated accounts. It happened.
11 Q And you saw that as a serious concern?
12 A Yes, and we raised it and the GAO raised it
13 with us in January. They said, you know, this — they
14 did not put an ultimatum. They observed it to Ambassador
15 Duemling in our initial meetings in January of '85 —
16 '86, because remember the program really took off in
17 October.
18 We began to really issue checks at the end of
19 October. Within four weeks oi^^^gg: Sf^eka , the ^ _
20 subcoiiunit%ae, the Westei^pBtmiiphetit. Sxib^^ittee^ «9ked
21 £«■ a GAO accbua^fef ^/^e J^fe'^fflBcr first nmart^gs with the
22 GAO in early December of 1985.
23 They virtually moved in. They had access to
24 our files right after Christmas, in January of '86. And
25 they were there until at least I left. They were in and
M'ltssra
1357
UNKJISSIFIED
119
1 out. And the Justice Department and the FBI and everyone
2 had access.
3 So the GAO, the Government Accounting Office,
4 was there from early January, in and out, discussing,
5 looking at the bank accounts and everything else. And
6 they pointed out the fact that we would have a problem
7 with comingling. But they said, we'll look into it a
S little further.
9 I think the GAO was holding out to see if any
10 of us would get access^^^^^^^^^^H and then we didn't
11 have it at that point. And then we did get it at the- end
12 of February. And I think they m: / have felt that they'
13 would be able to get in after us.
14 But they were perfectly aware, and they
15 poinfa^ it out to us in January, but they did not offer
16 suggastions, given the political reality of what we had
17 to deal witl-
18 MR. SMILJANICH: That will conclude the
19 deposition. Thank you for coining, Mr. Arcos.
20 I will havfr^the court reporter prepare a
21 transcript of this. The classification level for the
22 deposition will be secret. Nothing you said goes beyond
23 secret, does it?
24 THE WITNESS: No, I don't think there's
25 anything top secret.
UNgtASSIFIED
1358
20
UimSSIFIED
120
1 MR. SMILJANICH: If it even got to secret.
2 THE WITNESS: Well, the Agency. I named some
3 people in the Agency.
4 MR. SMILJANICH: Okay, the classification will
5 be secret. When she prepares the transcript, I would
6 like you to take a look at the transcript so that you can
7 make sure of the spellings and that she has things down
8 correctly. You can make notations at the back if you
9 feel that she put down one thing and you said something
10 else, a word or something.
11 Then after that you can sign the depositioo,
12 and then we will get a copy.
13 (Whereupon, at 6:45 p.m., the taking of the
14 instant deposition was concluded.)
15
16
17 Signature of the witness
18 SUBSCRIBED AND SWORN TO before me this
19 day of , 198 .
21 Notary Public
22 My Commission expires:
VNWSIFIED
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