$Unique_ID{bob01075}
$Pretitle{}
$Title{Iran-Contra Affair: The Report
Chapter 22C  Section 2:  Income Generation}
$Subtitle{}
$Author{Various}
$Affiliation{}
$Subject{enterprise
north
funds
money
secord


see
tables
}
$Date{1987}
$Log{See Table 3*0107501.tab
See Table 4*0107502.tab
}
Title:       Iran-Contra Affair: The Report
Author:      Various
Date:        1987

Chapter 22C  Section 2:  Income Generation

     The details of each of these income-raising efforts are set forth in
other chapters of this Report.  The summary here demonstrates that every
single source of Enterprise income involved North and the use of U.S.
Government resources.  Indeed, Secord flatly acknowledged this connection.

[See Table 3: Enterprise Income in 1985 and 1986]

     Initially, North arranged for Calero to receive contributions and to
purchase arms from Secord.  Later, the Enterprise received Contra
contributions directly and used them to buy arms for the Contras.  Then
Poindexter and North agreed to use the Enterprise as the agent for the Iranian
initiative, with North pricing the sales at a markup that generated excess
funds for the Contra resupply operation and other Enterprise activities.
Through a conduit, the CIA became a source of funds for the Enterprise when it
purchased weapons originally destined for the Contras.  Indeed, North tried to
get the CIA to provide more:  When the Boland Amendment expired and
Congressional funding for the Contras resumed, he tried to persuade the CIA to
purchase the Enterprise's aircraft and airstrip.  The only money the
Enterprise was able to earn on its own was about $254,0001 in investment
income on the money that came from its U.S. Government connections.

     North helped generate the Enterprise's revenues, and, in turn, Secord and
Hakim accommodated North's requests for funds and services.  At North's
request, the Enterprise bought a ship, sent radios to a foreign political
party, and provided money to Drug Enforcement Administration (DEA) agents for
a covert operation.  Hakim testified that, as a result of these kinds of
demands, he was not sure who was making the decisions about the use of the
Enterprise's funds - North acting as an official of the U.S. Government, or he
and Secord.  As Hakim put it:  "whoever designed this structure, had a
situation that they could have their cake and eat it too.  Whichever they
wanted to have, a private organization, it was private; when they didn't want
it to be a private organization it wasn't."

The Cash Balances

     The Enterprise companies built up substantial cash balances, which
totaled almost $5.5 million by the time the operations came to a halt in
December 1986.  Hakim testified that he understood that North wanted a pool of
funds available in Switzerland for the Contras and any other purpose he might
designate.  Secord testified that he was "generating money to keep the
Enterprise going."  Later, in an interview, he elaborated:

The majority of the money was in [the Enterprise accounts] to provide
operating capital for a very, very large enterprise which owned a ship, and
which was preparing to buy a two million dollar 707, and which was preparing
to set up permanent headquarters in Europe for a joint Iranian-American
commercial venture.

[See Table 4: Estimated Ending Monthly Cash Balances]