TIME: Almanac 1993/TIME Almanac 1993.iso/time/caps/87/87capcon.7

Text File | 1992-10-19 | 5.4 KB | 111 lines

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                                                          ╚November 30, 1987

IRAN-CONTRA

Here Comes the Prosecutor


Now it is Walsh's turn


When the brown, 690-page congressional report on the
Iran-contra fiasco finally thumped onto desks in Washington last
week, one of the officials most keenly interested in the scandal
vowed not to pick it up. Independent Counsel Lawrence Walsh
cannot use any testimony that witnesses gave to the House and
Senate committees under grants of immunity. Walsh and his staff
of 28 lawyers, 20 FBI agents and six IRS investigators must
build their own criminal cases against any lawbreakers.
Nonetheless, the tightly reasoned, judiciously stated majority
report, signed by all of the committee's 15 Democrats as well
as by three Republican Senators, contains ample reasons why
Walsh and his crew are likely to push hard for indictments of
several participants in the Iran-contra affair.

In one of the report's most notable conclusions, the bipartisan
majority declares flatly that the profits generated by the sale
of U.s. arms to Iran were the rightful property of the Federal
Government, not of the so-called enterprise operated by retired
Major General Richard Secord and his Iranian-born partner.
Albert Hakim. Diverting those profits to the Nicaraguan contras
"constituted a misappropriation of government funds," the report
claims. If Walsh and a federal grand jury concur, Secord and
Hakim may face indictments. So, too, may former National
Security Adviser John Poindexter, who approved the diversion,
and former-NSC Staffer Oliver North, who directed the
enterprise.

Secord and Hakim benefited more from the arms sales than the
contras did, according to the report. Of the $16 million in
Iran arms profits, the contras received just $3.8 million.
Secord, who testified that he sold weapons to the contras with
a profit markup of 20%,actually took profits that averaged 38%
and sometimes reached 56%. When contra Leader Adolfo Calero
discovered he could buy weapons far more cheaply through a
European arms dealer, North made sure that none of the Iran arms
proceeds went directly to Calero. Instead they went to Secord,
who continued to sell to Calero at inflated prices.

Similarly, the report relates how the private fund raisers Carl
Channell and Richard Miller collected some $10 million for
contra support but spent only $4.5 million on the rebel forces.
The rest of the money went into lavish offices, fancy
limousines and high salaries. The two have pleased guilty to
tax fraud for claiming that their operations were entitled to
an IRS exemption.

Walsh has been presenting witnesses to a grand jury at a
stepped-up pace of three times a week. One of the witnesses
last week was Attorney General Edwin Meese, who is sharply
criticized in the report for failing to seek advice before
telling the President that he could legally sell arms to Iran
without informing Congress. Meese testified that he relied on
an opinion written in 1981 by former Attorney General William
French Smith. But the report points out that Smith had advised
that Congress would have to be notified once arms shipments were
under way. Said the report: "There is only one reason to have
an attorney general on the NSC: to give the President
independent and sound advice. That did not happen in the Iran
affair and the President was poorly served."

Meese is also accused of "departing from standard investigative
techniques" in quizzing other Administration officials about how
the arms-for-hostages deals had begun. At first Meese's aides
accompanied him and took careful notes. But once the
investigators discovered the celebrated memo in North's files
that called attention to the diversion of funds to the contras,
Meese went alone to interview Poindexter, former National
Security Adviser Robert McFarlane and then CIA Director William
Casey. He took no notes.

Despite the Administration's claim that it was dealing with
"moderates" in Iran, the report reveals that some U.S. arms
went directly to the Revolutionary Guards, Iran's most radical
faction. And when North and Poindexter tried to open a "second
channel," they wound up dealing with some of the same
principals. One of the Iranians may have helped plan the
kidnap-murder of William Buckley, the CIA operative in Lebanon
whose capture especially angered Reagan and Casey.

As expected, the majority report is severe on Reagan, charging
that he failed to "take care that the laws be faithfully
executed."  THat falls short of accusing him of impeachable
offense. While taking no stand on whether the President did or
did not know about the diversion, the report contends, "If the
President did not know what his national security advisers were
doing, he should have."

A minority report, signed by all six House Republicans and
Republican Senators Orrin Hatch and James McClure, insists that
the majority's conclusions were "hysterical" and that the
President and his staff made "mistakes in judgment, and nothing
more." Republican Senator Warren Rudman, who agreed with the
majority, dismissed the highly partisan minority paper as
"pathetic." Indeed, the profiteering, shredding of documents
and widespread lying, and a secret policy that eroded the
President's credibility while accomplishing none of its
objectives, clearly was something more than a mere matter of
poor judgment.

--By Ed Magnuson. Reported by Hays Gorey and Elaine
Shannon/Washington.