$Unique_ID{bob01025} $Pretitle{} $Title{Iran-Contra Affair: The Report Chapter 5B Reward for a Friend} $Subtitle{} $Author{Various} $Affiliation{} $Subject{north prince fbi miller agent official terrell department revell contras} $Date{1987} $Log{} Title: Iran-Contra Affair: The Report Author: Various Date: 1987 Chapter 5B Reward for a Friend In one episode, the NSC staff undertook to persuade the Department of Justice to "reward" someone characterized by North as a "friend" who had been convicted of plotting to assassinate a Central American leader. In that episode, the NSC staff's motive appears to have been a desire to prevent disclosure of certain questionable activities. According to a North PROF to Poindexter, the "friend" was an official in a Central American country with whom North, the U.S. Ambassador, General Gorman, and Dewey Clarridge arranged for bases for the Contras as well as overall logistics, training and support. This official and other plotters were indicted prior to 1986 for conspiracy to assassinate a Central American leader. Pursuant to a plea agreement, the official pleaded guilty to two felony counts which carried a significant maximum sentence; and he was later sentenced to two shorter, though still significant, prison terms to run concurrently. At the sentencing hearing, U.S. military officials assigned to the State Department testified on behalf of the official. The court provided that the official could be immediately eligible for parole if so determined by the Parole Commission and recommended he serve his sentence at a minimum security institution. Meanwhile, Assistant Secretary of State Elliott Abrams promised the official's government that he would look into the case. In a September 17, 1986 PROF message to Poindexter, North noted that the official was under the impression he would serve only a matter of days or weeks at the minimum security institution and then be released. North was concerned that once the official realized he was really going to serve a long sentence, "he will break his longstanding silence about the Nic[araguan] Resistance and other sensitive operations." North noted the next morning he would meet with Oliver Revell, Steven Trott, and Elliott Abrams to explore the possibility of a pardon, clemency, deportation, or sentence reduction. The objective of this exercise, as North put it, was "to keep [the official] from feeling like he was lied to in legal process and start spilling the beans." Admiral Poindexter responded: "You may advise all concerned that the President will want to be as helpful as possible to settle this matter." Representatives of different agencies of the Administration met to discuss the request for leniency. Deputy Assistant Attorney General Mark Richard attended a meeting where Defense Department representatives argued on the official's behalf. Richard concluded their reasons were not sufficiently specific. No one ever gave a detailed account of what the official had actually done for the United States to deserve leniency. He was always simply described as a "friend of the United States." The State Department agreed with the Department of Justice that the official was a terrorist and should be punished. The CIA did not express an opinion. At a subsequent meeting in North's office on September 24, 1986, North tried to convince Trott, Revell, C/CATF (CIA) and James Michel, Deputy Assistant Secretary of State, that the official was only tangentially involved in the assassination plot and deserved leniency. Revell disagreed. North asked them to consider recommending a minimum security correctional institution rather than the federal prison to which the official had been assigned, despite the court's recommendation, by the Bureau of Prisons. In early October, North tried again with the Department of Justice, this time with help from General Gorman and Dewey Clarridge. Also at this meeting were Mark Richard (filling in for Trott), Revell, and Elliott Abrams. North, Gorman and Clarridge all argued for leniency for the official, explaining only that the official was a "friend of the government" who was "always ready to assist us" and "was helpful in accommodating our military." Abrams agreed that the U.S. should do what it could for the official, thereby reversing the State Department's earlier position. According to Richard, he offered to meet with others in the Department and determine whether the Department would oppose the transfer of the official to the minimum security institution. North's contemporaneous account of that meeting portrayed the Justice Department as more committed to assisting the official. In a PROF note to Poindexter, North indicated that, after the last co-conspirator was convicted and sentenced, the Department of Justice would have the defense attorney file a motion to reduce the sentence to time served and arrange to have General Gorman brief the court in camera on the equities. North said Trott and Revell believed this should result in the release and deportation of the official. North suggested that the official's attorney should be discreetly briefed to mollify the concerns of those involved that the official "will start singing songs nobody wants to hear." Richard soon determined that neither Trott nor Kellner had any objection to redesignating the official to the minimum security institution, as contemplated in the original court's recommendation and made the appropriate arrangements with the Bureau of Prisons. The Fake Prince As explained briefly in the previous chapter, an individual named Kevin Kattke contacted North in March or April 1985 about a Saudi "prince" who proposed donating to the Contras approximately $14 million in proceeds derived from the sale of the prince's oil. North referred the "prince" to Richard Miller. Miller and the "prince" met regularly over the course of the next several months. The "prince" sought Miller's help in marketing the oil, agreeing to pay Miller $1 million of the profits earned. Miller kept North regularly apprised of his dealings with the "prince", which eventually also included both a proposed gold transaction and assistance in freeing the hostages held in Lebanon. Indeed, Miller saw himself as "an agent working on [North's] behalf" in connection with these activities. Yet while North was attempting to develop the "prince" as an asset in both his Iran and Contra initiatives, the FBI was investigating the "prince" for bank fraud. From the start, Miller had misgivings about the bona fides of the "prince." He did library research without much success in an effort to establish the "prince's" authenticity. According to Miller, North told him that the CIA had confirmed both the "prince's" identity and the veracity of the "prince's" information about the hostages. Early in their relationship, the "prince" told Miller that he had information about the hostages in Lebanon that would be useful to U.S. efforts to locate and extricate the hostages. At North's suggestion, Miller related this information to the Hostage Location Task Force, representatives of which met with and interviewed the "prince" in Houston. Miller continued to inform North of the hostage-related information conveyed by the "prince." In July 1985, North asked a DEA agent (Agent 1) - who was detailed to North in connection with hostage release efforts - to accompany Miller and the "prince" to England to assist the "prince's" entry into the country, if necessary. Agent 1 agreed, and North arranged for payment of his travel expenses. The three men stayed in London for five or six days. Based on discussions with the "prince" about the situation in the Middle East, Agent 1 concluded that it would be worthwhile to develop the "prince" as a source in the hostage location effort. In August 1985, the DEA agents embarked on further activities with the "prince." At North's request, they traveled to Geneva from Cyprus to help the "prince" obtain travel papers after his passport had allegedly been stolen. Even with the cooperation of Ambassador Faith Whittlesey, Agent 1 was unsuccessful in obtaining a U.S. passport for the "prince." A week later, however, Agent 1 obtained travel papers for the "prince" issued by another country. Agent 1 remained with the "prince" in Europe for some time thereafter, and paid the "prince's" expenses. At North's request, Secord met Agent 1 and the "prince" in Geneva in September 1985. After meeting the prince, Secord expressed to Agent 1 concerns about the "prince's" bona fides. Meanwhile, during the spring and summer of 1985, the "prince" developed legal problems in the United States. In late spring, the "prince" cashed a $250,000 check at William Penn Bank in Philadelphia, which was returned for insufficient funds. This event resulted in a referral to the FBI's Philadelphia field office for bank fraud charges against the "prince". In connection with the fraud investigation, the FBI's Washington field office was asked to interview both North and Miller. An FBI agent interviewed North on July 18, 1985. According to the agent, North said that he had referred the "prince" to Miller because it was inadvisable (and potentially unlawful) for an NSC staff person to meet with an individual who planned to contribute funds to the Contras. North further informed the agent that the "prince's" interest in donating to the Contras was discussed by North personally with the President and with Robert McFarlane. North "confidentially" advised the agent that the NSC staff had maintained indirect contact with the "prince" because of the Contras' desperate need for funds. North specifically requested that attempts by the FBI to interview the "prince" be held in abeyance until after the week of July 22, 1985, because the Congress was expected to approve funding for the Contras that week. After being pressed by the FBI agent, North "backed down" on this request, although he expressed his view that FBI contact with the "prince" prior to the NSC's determination of the "prince's" true intentions likely would eliminate any possibility that the "prince" would aid the Contras. On his departure from North's office, the agent was introduced by North to Adolfo Calero, whom North called the "George Washington of Nicaragua". After the North interview, the FBI agent attempted to contact Miller, who did not return several of the agent's telephone calls. North called the agent on July 30, 1985, in apparent response to the agent's attempt to reach Miller. North told the agent that Miller and the "prince" were in Europe arranging a transfer of funds from the "prince" to the Contras. On August 27, the FBI agent finally interviewed Miller, who outlined the history of his contacts with the "prince." Miller mentioned that he knew North, but did not disclose anything to the agent about Nicaragua. In October, Miller was interviewed again by the FBI. During this session, he pledged complete cooperation with the fraud investigation. During the course of the grand jury investigation of the "prince," North called the FBI's Oliver Revell once again to express concern that Miller might be questioned about confidential governmental matters. North told Revell that Miller was a consultant to the NSC and the State Department on the hostage situation, but did not mention Miller's efforts on behalf of the Contras. At North's request, Revell called the Assistant United States Attorney who was handling the "prince's" prosecution in Philadelphia. Revell related the concern expressed by North, and was assured by the prosecutor that, if Miller testified, he would not be questioned about any hostage-related activities. According to Miller, he spent approximately $370,000 on the activities involving the "prince." North was aware of and approved these expenditures. On at least three occasions - two of which occurred after Miller agreed to cooperate fully in the investigation of the "prince" - Miller sent traveler's checks to the "prince" in Europe. Although the "prince" requested these payments - which totalled $32,500 - at least $15,000 was used to finance the DEA hostage rescue operations. North approved all such payments. These expenditures, however, did not result in monetary loss for Miller. He complained to North of the money that the "prince" had cost him, and North told Miller to take reimbursement for these costs from Contra assistance funds that he had transferred to Miller's company by Carl "Spitz" Channell's tax-exempt organization. In the end, it was determined that the "prince" was neither a "prince," nor even a Saudi. He was an Iranian con man, who pleaded guilty to bank fraud charges on the eve of his trial. He now is incarcerated in a federal penitentiary in Texas. Instigation of Investigations North attempted to exploit his contacts with the FBI to attempt to instigate or intensify investigations of people and organizations perceived as threats to the Enterprise. He was ultimately assisted in this effort by Richard Secord and Glenn Robinette. In early 1986, Secord had been the target of allegations that he was running guns and drugs between Central America and the United States. In May 1986, these allegations blossomed into a lawsuit filed in United States District Court for the Southern District of Florida. The lead plaintiffs in the action were reporters Martha Honey and Tony Avirgan, who were represented by the Christic Institute. The defendants included Secord, Thomas Clines, Theodore Shackley, and John Hull. At some point after the lawsuit was filed, North again contacted Oliver Revell, this time to suggest that the federal government ought to investigate the plaintiffs because he thought they were probably being funded or supported by the Sandinistas. Revell told him that the FBI did not engage in that type of investigation. On May 9, the FBI interviewed North about alleged measures taken against him. North claimed that his car had been vandalized, he had been followed, and his dog had been poisoned. North also claimed a fake bomb device had been left in his mailbox. He had not kept the device, however, for the FBI to analyze. North told the FBI that he had written down the license number of the car that was used to follow him, but, after several requests from the FBI, he failed to provide it, claiming he lost the number. The FBI checked with the local police regarding the fake bomb device placed in North's mailbox. North had told them he discarded it before it could be examined. The FBI concluded it was probably a prank rather than a threat. On June 3, 1986, North met with FBI agents to discuss an investigation they had been conducting into allegations by North that he was the target of politically motivated vandalism and harassment, perhaps by foreign intelligence sources. At this meeting, North expressed his displeasure about the FBI's alleged lack of effort in the investigation. In particular, he complained that the FBI had never contacted an NSC staffer who supposedly was the source of allegations linking North to drug traffic, had not investigated Daniel Sheehan of the Christic Institute, had not interviewed a reporter who claimed North had threatened him, had not examined allegations made by Senator Kerry against North, and had not attempted to interview Senator Durenberger and Representative Hamilton to determine the sources for allegations made against North about which they had raised questions. Despite these complaints, the FBI ultimately closed its investigation after concluding that none of North's complaints could be traced to foreign intelligence sources. North ultimately hit on a better formula, however, with Secord's assistance. In March 1986, Secord had retained Glenn Robinette, a security consultant and former CIA officer, to conduct a private investigation of some of the individuals ultimately involved in the Honey and Avirgan lawsuit. One of the people Secord singled out for such treatment was Jack Terrell, also known as "Colonel Flaco." Terrell had at one time been a pro-Contra mercenary associated with Tom Posey and CMA. He ultimately became disillusioned with the Contras, however, and began to cooperate with the plaintiffs in the lawsuit. He threatened to testify that North had helped provide secret funding to the Contras and that he, Terrell, had used CMA as a cover from which to carry out CIA-sponsored assassinations. In mid-1986, the FBI received information from a classified source that pro-Sandinista individuals might have been contemplating an assassination of President Reagan. The FBI suspected that Terrell might be involved and disseminated this information to the CIA, Secret Service, State Department, Department of Justice, and NSC. Shortly thereafter, on July 15, 1986, Revell received a call from North, who indicated that he knew a person familiar with Terrell's activities and would make his contact available for debriefing. The FBI met that evening with Robinette, North's contact, who told them he had met Terrell on July 11 while posing as an attorney exploring the possibility of collaborating with Terrell on a book, movie, and television program. Robinette, who was in daily contact with Terrell, offered to assist the FBI in gaining information about him. On July 22, 1986, FBI agents interviewed North. He told them he had heard of Terrell eighteen months earlier when a Contra intelligence officer complained of Terrell's brutality. North claimed he suggested at the time of that incident that local officials should expel Terrell. North stated that he had heard that Terrell had tried to import guns into a Central American country and had claimed to be formerly with U.S. Army Special Forces and the CIA. The FBI agents asked North about Secord and Robinette. North said Secord ran an import-export business and was a consultant to the Defense Department and emphasized Secord did not work for him. He said Robinette was a security consultant hired by Secord to investigate Terrell. North acknowledged he met with Robinette prior to sending him to the FBI and that Robinette gave him copies of the Terrell manuscript and the other materials Robinette shared with the FBI. North stated that neither he nor his staff was responsible for arming, funding, or administering Contra programs and denied he was involved with covert operations being run from the U.S. The FBI decided to watch Terrell with Robinette's help. Although Robinette refused to wear a recording device, he reported back to the FBI after he met with Terrell. Shortly thereafter, Terrell went to Miami at the same time President Reagan visited Miami. Agents observed him there and concluded he was not a threat to the President. The FBI then terminated this investigation. Summary These seven episodes collectively show how the NSC staff, and North in particular, tried to prevent exposure of the Enterprise by law enforcement agencies. We do not mean to impugn the integrity of the law enforcement officials involved. Suggestions that national security could be compromised, coming from NSC aides, inevitably were given weight by law enforcement officials and led them on occasion to provide information to the NSC staff and to delay investigations. The fault lies with the members of the NSC staff who tried to compromise the independence of law enforcement agencies by misusing claims of national security.