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Iran/Arms Transaction: Congressional Material: Joint Committee Report (6)
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Iran/Arms Transaction: Congressional Material: Joint Committee Report (6)
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Records of the Office of Counsel to the President (Reagan Administration)
Arthur Culvahouse's Office Files
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Ronald Reagan Presidential Library
Digital Library Collections
This is a PDF of a folder from our textual collections.
Collection: Culvahouse, Arthur B.: Files
Folder Title: Iran/Arms Transaction: Congressional
Material: Joint Committee Report (6)
Box: CFOA 1130
To see more digitized collections visit:
https://reaganlibrary.gov/archives/digital-library
To see all Ronald Reagan Presidential Library inventories visit:
https://reaganlibrary.gov/document-collection
Contact a reference archivist at: [email protected]
Citation Guidelines: https://reaganlibrary.gov/citing
National Archives Catalogue: https://catalog.archives.gov/
THE WHITE HOUSE
WASHINGTON
November 4, 1987
MEMORANDUM FOR ARTHUR B. CULVAHOUSE, JR.
FROM:
ALAN CHARLES RAUL ASC
SUBJECT:
Declassification of Report/House Minority:
"Nicaragua"
This section of the report is 32 pages long and arrived for
declassification on October 29. The salient points are noted
below:
P. 1 - "It is impossible to understand the motivations for the
Administration's actions without first understanding the
strategic and political context within which it was
operating. In describing these circumstances, it is
necessary to being with the fact that the Sandinista
government in Nicaragua is a Marxist regime that openly
espouses the expansionist, Leninst doctrine of 'revolution
without borders. Because of this, and because the
Sandinistas have behaved in a manner consistent with the
doctrine by supporting Communist insurgencies elsewhere in
Central America, Nicaragua has become a direct threat to the
stability of the governments of its neighbors and to U.S.
security interests.'
P. 9 - "So there is plenty of reason for a President of the
United States to think the Nicaraguan government is not
merely unfortunate for its own people, but a distinct threat
to the security of the region and, ultimately, to the United
States. This is no speculative threat. In 1983 the
Congress found that:
By providing military support (including
arms, training, an logistical, command and
control, and communications facilities) to
groups seeking to overthrow the government of
El Salvador and other Central American
governments, the Government of National
Reconstruction of Nicaragua has violated
Article 18 of the Charter of the Organization
of American States which declares that no
state has the right to intervene, directly or
indirectly, for any reason whatsoever, in the
state. internal or external affairs of any other
THE WHITE HOUSE
WASHINGTON
November 4, 1987
MEMORANDUM FOR ARTHUR B. CULVAHOUSE, JR.
FROM:
ALAN CHARLES RAUL
AUR
SUBJECT:
Declassification of Report:
Untitled (Fascell Chapter)
This section of the Report is 85 pages long and arrived for
declassification on October 30. The salient points are noted
below:
P. 1 - "In 1982, just as President Reagan launched his Democracy
initiative in a speech to the British Parliament, DCI
William Casey approved the transfer of the Director of the
Covert Action Staff at the CIA to replace Donald Gregg as
Director of the Intelligence Staff at the National Security
Council. From that position, Casey's designee, a career CIA
covert operative and a specialist in propaganda and
disinformation, helped launch an effort which resulted in
the establishment of an elaborate government/private system
of consultants, lobbyists, public relations experts,
fundraisers, and media specialists who carried out a
determined campaign to sell President Reagan's Central
American policies to the American public, the media, and the
Congress. These efforts also resulted in the raising and
distribution of money for weapons and military supplies to
the Contras."
P. 3 -- "Channell, with the assistance of Administration
officials, including the close involvement of Lt. Col.
North, used the White House to brief potential donors to the
Contras. The briefings were followed by an event at the Hay
Adams Hotel where a pitch for money was made by Channell.
Some of the major contributors later met or had photo
opportunities with the President. Funds received from these
same donors were also used by Channell in a campaign to
defeat Congressman Mike Barnes, one of the principal
opponents of Contra aid in the Congress."
P. 4 - "The General Accounting Office, in a recent report
(9/30/87) to the House Committees on Government Operations
and Foreign Affairs, concluded that the State Department
Office of Public Diplomacy for Latin America and the
Caribbean 'engaged in prohibited, covert propaganda
activities designed to influence the media and the public to
support the Administration's Latin American policy. The use
of appropriated funds for these activities constitutes a
violation of a restriction on the State Department annual
2
appropriations prohibiting the use of federal funds for
publicity or propaganda purposes not authorized by the
Congress.
P. 3a - "In the early part of 1983, documents obtained by the
Select Committees indicate that the Director of the
Intelligence Staff of the NSC successfully recommended the
establishment of an inter-governmental network to promote and
manage a public diplomacy plan designed to create support
for Reagan Administration policies at home and abroad.
Their initial efforts were directed toward involving private
groups and individuals in a campaign to influence American
and European public opinion on Intermediate Nuclear Force
(INF) deployment in Europe."
P. 11 - "Channell's principal organization, the tax-exempt
National Endowment for the Preservation of Liberty (NEPL),
used White House briefings and private meetings with the
President to raise more than $10,000,000 from private
contributors, almost all for the Contra cause. Over half of
this total came from two elderly widows -- Barbara Newington
and Ellen Garwood -- who made the bulk of their contributions
after receiving private and emotional presentations by
Oliver North on the Contras' cause and military needs. One
dozen contributors accounted for ninety percent of NEPL's
funds in 1985 and 1986. "
P. 13 - "North misrepresented to several White House officials
the nature of the network's fundraising activities. For
instance, the President apparently was led to believe that
the funds were being raised for political advertising; the
President's Chief of Staff, Donald Regan, was deliberately
kept in the dark by North and Poindexter; and North
misrepresented to Congress and White House personnel the
nature of his involvement in the activities of NEPL and IBC.
As a result, the Miller/Channell network was able to operate
successfully until the latter part of 1986, when increased
government aid to the Contras and public disclosure of both
the Iranian arms sales and the Contra resupply network made
further assistance efforts unnecessary and unwise.
By using a tax-exempt organization to funnel money to the
Contras -- for arms and other purposes -- Channell and
Miller provided tax deductions to donors. As a result, the
United States Government effectively subsidized a portion of
contributions intended for lethal aid to the Contras."
P. 17 - "Raymond and North engineered a White House briefing for
potential donors and fundraisers who could help make the
dinner a success. The White House briefing, which was
designed to demonstrate the dire need of the Nicaraguan
refugees in Honduras was to be followed by a reception at the
Hay Adams Hotel where a pitch to help raise funds was made.
[Memorandum N14857 from Walt Raymond and Oliver North to
3
Robert McFarlane, Nicaragua Refugees, 1/8/85]. White House
Counsel, Fred Fielding, initially objected to White House
involvement in the events but later reluctantly revised his
opinion after pressure was generated by Walt Raymond."
P. 20 - "In January 1985, after NEPL ran a large newspaper
advertisement congratulating President Reagan on his
inauguration, Channell received a call from Edie Fraser, of
the public relations firm of Miner and Fraser. According to
Channell, Fraser indicated that she admired the ad and asked
for NEPL's assistance in organizing and promoting a
fundraising dinner for the Nicaraguan Refugee Fund (NRF).
This was Channell's introduction to the Contras' cause."
P. 22 - "According to Channell, the NRF dinner had to be
postponed several times, and was an organizational disaster.
When it finally took place on April 15, 1985, President
Reagan attended and delivered the keynote address. The NRF
dinner convinced Channell that large and expensive functions
were not efficient methods of raising money for the Contras.
However, the President's commitment to the Contra cause
convinced Channell that the Nicaraguan issue was a fertile
one for private fundraising.
Thereafter, Channell and Conrad, with the assistance of
Miller and Gomez, concentrated on private meetings with
potential large donors, who would be give an audience with
North and, in some cases, a photo opportunity with the
President.
P. 23 - "The idea of focusing on potential big givers to the
Contras was not new. Edie Fraser, one of the principal
organizers of the NRF dinner, testified that at the
suggestion of the State Department she met with North and
Walt Raymond on December 11, 1984, to seek White House
'participation' in the dinner. Fraser mentioned the Sultan
of Brunei to North as a possible contributor to the NRF.
Fraser explained that the Sultan had come to her attention
because he was a contributor to a prior program sponsored by
Mrs. Reagan. On December 28, 1984, Fraser sent further
biographical information on the Sultan to North, but does not
know if North ever followed this lead. [Fraser Dep. at 28,
31-39, N6298].
On March 4, 1985, Fraser sent additional information to
North on the planned dinner. At the bottom of the cover
letter she added a handwritten note: 'Ollie, Very Imp., Two
people want to give major contribs i.e. 300,000 and up if
they might had one 'quiet' minute with the President.
P. 40 - "Large contributors to NEPL uniformly received thank you
letters from North (and often from the President) for their
support of the President's policies in Central America,
although without specific reference to any contribution."
4
P. 48 - "Either at this breakfast or the evening before, Channell
informed O'Boyle that if he contributed $300,000 or more, a
15-minute 'off-the-record' meeting would be arranged between
O'Boyle and President Reagan. Channell indicated that other
people who had contributed that amount of money had met with
the President. O'Boyle understood that these meetings with
the President were "off-the-record" because the subject
matter was so secret and sensitive."
P. 52 - "The Role of the President
In a May 19, 1986 PROF note to Poindexter, North wrote 'the
President obviously knows why he has been meeting with
several select people to thank them for their 'support for
Democracy' in Cent[ral] Am[erica].' [N12528]. In fact,
what the President knew is a matter of some doubt.
The President, in his March 19, 1987 press conference said
that he believed that contributors he met had donated money
for political advertising for the Contras. [New York Times,
3/20/87, at A-10, Col. 4[. The minutes of the May 16, 1986
National Security Planning Group (NSPG) meeting reveal the
same understanding on the part of the President. He stated,
"What about the private groups who pay for ads for the
Contras? Have they been contacted? Could they do more than
ads?' [N 10298]. Similarly, in preparation for the
January 30 briefing, Linda Chavez wrote a memorandum to the
President, stated that 'ACT and NEPL spent in excess of $3
million supporting the President's programs through public
awareness using television and newspaper messages.'
[N 22715]. In fact, much of the $3 million was directed
toward Contra support activities, including arms.
Poindexter, however, testified at his deposition that
'[t]here wasn't any question in my mind' that the President
was aware that the contributors he was thanking were giving
to the Contras. [Poindexter Dep., 5/2/87, at 203]. He
added that 'in the White House during this period of time
that we were encouraging private support, we really didn't
distinguish between how the money was going to be spent.
[Poindexter Dep., 5/2/87, at 202]. North testified that in
writing his May 19 PROF note, he assumed that the President
was aware that the contributions were for munitions, as well
as other things, although he denied ever discussing this with
the President. [7/7/87, at 241].
The President met with and thanked several large
contributors for their support of his policies. David
Fischer, former Special Assistant to the President, arranged
Presidential photo opportunities or meetings with at least
seven major Channell/Miller contributors in 1986. Fischer
and Martin Artiano, a Washington lawyer, were paid steep
fees by IBC (which charged these fees to NEPL) for arranging
these meetings (among other services). Channell's statement
5
to O'Boyle that these meetings carried a $300,000 price tag
is substantiated by Edie Fraser's cryptic note to North
(mentioned above); at least five of the six contributors who
donated more than $300,000 to NEPL were invited to meet with
the President."
P. 69 - "Nearly all of these activities -- [against Mike Barnes]
-- television ads, lobbying, grassroots pressure and
newspaper ads were funded by the same contributors who had
been invited to the White House for Oliver North's briefings
and who had met with the President."
P. 80 - "The private fundraising endeavors of Spitz Channell and
Rich Miller, and even those of minor figures like Roy
Godson, all grew out of the desire of the Reagan
Administration, particularly CIA Director Bill Casey, to
circumvent the strictures of the Boland Amendment and to
create a political climate conducive to the resumption of
U.S. assistance to the Contras
Although President Reagan's role in the private funding
operation is not entirely clear, it is apparent that the use
of the White House and the President's name in the
fundraising schemes of Channell and Miller provided a
sizable amount of sustenance and a sense of legitimacy to
the whole operation
The State Department was used to run a prohibited, domestic,
covert propaganda operation. Established despite resistance
from the Secretary of State, and reporting directly to the
NSC, the Office of Public Diplomacy for Latin America and the
Caribbean attempted to mask many of its activities from the
Congress and the American people.
One of the CIA's most senior covert action operators, was
sent to the NSC in 1983 by CIA Director Casey where he
participated in the creation of an inter-agency public
diplomacy mechanism that included the use of seasoned
intelligence specialists. The operation spawned Rich Miller
and Frank Gomez, who were sustained with sole-source, no-bid
State Department contracts and co-opted Spitz Channell and
his cohorts in the private sector. This public/private
network set out to accomplish what a covert CIA operation in
a foreign country might attempt -- to sway the media, the
Congress, and American public opinion in the director of the
Reagan Administration's policies."
THE WHITE HOUSE
WASHINGTON
November 4, 1987
MEMORANDUM FOR ARTHUR B. CULVAHOUSE, JR.
FROM:
ALAN CHARLES RAUL
ACR
SUBJECT:
Declassification of Report:
"Other Privately-Funded Covert Operations"
This section of the Report is 48 pages long and arrived for
declassification on October 31. The salient points are noted
below:
P. 1 - "Under the plan that Lt. Col. Oliver L. North attributed
to Director of Central Intelligence William Casey, profits
from the Iran arms sales were to fund not just the Contras
but other covert operations of the Enterprise as well.
Before the Iran arms sales became public, Lt. Col. Oliver L.
North had begun implementing certain projects he and Casey
believed the Enterprise could perform.
'We always assumed,' North said later 'that there would come
a time again, as indeed it did, where the Congress would
make available the moneys necessary to support the
Nicaraguan freedom fighters.' When that happened, the
Enterprise, functioning free of government scrutiny and with
ample funds, could carry out other covert projects; many
were intended 'to be conducted jointly [with]
other
friendly intelligence services' while others would be
limited to activities conducted by North, Secord and Hakim.
Even before the Enterprise was formed, however, North was
operating with non-appropriated funds on another project
that the Government could not do because it was contrary to
United States policy -- the ransom of the hostages."
P. 13 - "North recommended in the memorandum that McFarlane
approve the [DEA hostage] plan and ask the Attorney General
to detail Dwyer and Tarallo to the NSC for 30 days.
McFarlane initialed the 'approve' line at the bottom of the
memo. McFarlane handwrote just under the approve line,
'North to follow up 6/10 with AG.
P. 13, 43n - "McFarlane testified that he never discussed this
matter with the President."
P. 14 - "Around June 10, [1985] North prepared a memorandum for
Attorney General Meese describing how the DEA agents would
deposit the $200,000 and open an account for the remaining
2
$2 million, which was to be provided by the 'donor to bribe
those in control of the hostages.' North asked the Attorney
General to assign the DEA agents to 'this organization [NSC
staff] for a period not to exceed 30 days.' Attorney
General Meese complied with North's request. That
assignment would last for over one year. =
P. 20 - "In January 1986, Christensen expressed to Allen his
concern regarding the propriety of using money to gain the
hostages' release. Allen replied that North had told him
that the President had said he would 'go to Leavenworth if
necessary' to free the hostages."
P. 20, 68n - "Christensen assumed that North meant that the
President was willing to commit illegal acts to gain the
release of the hostages. Christensen did not believe the
statement.'
P. 20 - "Christensen also recalled that in March 1986, while
Allen and Christensen were generally discussing how to
finance efforts to free the hostages, Allen commented that,
'Ollie was already into his Contra money for the
hostages
Christensen did not pursue this remark."
P. 24 - "Soon after the June 1986 DEA mission failed, North told
McFarlane that Perot had complained that he lost his money
on the operation, and that North had failed to keep him
informed. North asked McFarlane to mollify Perot.
McFarlane eventually saw Perot and asked him 'not to be too
hard on Ollie. In addition, Perot received a letter from
the President, dated June 11, 1986, stating:
'I have been briefed on your effort over the
past several weeks on behalf of our Americans
abducted in Beirut. On behalf of the
American people, I want to thank you for your
discreet assistance in this regard. My hope
is that we may yet succeed in reuniting these
men with their families and loved ones.
Thanks again and God bless you.
P. 26 - "Throughout the DEA operation, private funds were used to
pay expenses of the agents and to provide the ransom money.
Yet, as discussed in Chapter
/ the use of
non-appropriated funds to finance Government operations is
inconsistent with the provisions of the Constitution
requiring that all monies spent by the Government be
appropriated by Congress. Numerous statutes and
governmental accounting rules implement this law. A
government official receiving money for the government from
any source must deposit it in the Treasury; government
agencies may not accept gifts of money; and government
employees may not receive private funds for the performance
of their governmental duties. To violate these laws creates
3
an obvious conflict of interest for the agents as well as
privatizing governmental functions. The use of private
money to finance the DEA operation broke each of these
rules.
"
P. 27 - "The evidence points towards the conclusion that the
Attorney General approved the use of private funds for the
ransom/resource operations. According to McFarlane, North
was informed by the Attorney General that it was acceptable
for Perot to contribute money to be used to bribe public
officials and other individuals in Lebanon. McFarlane
stated that Attorney General Meese had explicitly approved
this action and told him he was 'keeping an eye on it.'
North's testimony confirms McFarlane's account. North
stated that he understood from the Attorney General that 'we
couldn't use U.S. Government monies for those purposes [but]
we could use outside monies.' North also recalled informing
the Attorney General of the source of the money. Attorney
General Meese, however, maintained that he was not aware of
a 'plan to use private funds to ransom people in foreign
countries,' nor did he recall addressing the issue of using
appropriated or unappropriated funds to conduct the
activity.'
McFarlane testified that Attorney General Meese had advised
that while Government funds could not be used, private
monies could be used to bribe foreign officials to free the
hostages. Tarallo testified that Lawn told him that the
Attorney General had personally approved Tarallo's
participation in the NSC hostage effort. Tarallo told the
Committees that Lawn had given him instructions that the DEA
agents not handle the private money personally. But Tarallo
could not say whether that directive was Lawn's own
directive or whether he was simply conveying the Attorney
General's instructions. Dwyer stated that North gave him
the money-handling instructions and attributed them to the
Attorney General.'
P. 30 - "President Reagan repeatedly has stated since 1981 that
the United States would not pay ransom to terrorists who
kidnapped Americans, as policy adhered to by Administrations
of both parties over the years. There are practical reasons
for such a policy. Clair George, the Deputy Director for
Operations, stated: 'You don't trade for hostages
because now everybody is going to sell them for something.
Former Deputy Director of the CIA, John McMahon stated that
ransom payments could become a source of funds for
terrorists. When they 'run out of funds, they would kidnap
the nearest U.S. businessman, get a ransom and then they'd
fill their coffers for a year. When they needed more, they
would ransom another one.
The DEA operation had all these shortcomings plus an
additional one: it was inconsistent with the simultaneous
4
effort to gain the release of the hostages through the
Iranian initiative. It is reasonable to believe that the
Lebanese hostage holders would be less likely to release the
hostages at the request of Iran, at the same time they were
being offered $1 million a hostage in the DEA initiative.
There was little consideration of these factors. The DEA
initiative was not discussed at a meeting of the NSC; there
were no policy papers; and no consultation with the
Secretary of State. Secord summed up the process when he
testified that 'it did not occur to me at the time that
these two [efforts] clashed,' but he acknowledged that 'they
could have collided.' Some on the NSC staff characterized
the payments to the hostages holders as 'bribes' not ransom,
and the operation as a rescue, not a payoff."
P. 32 - "During the 1985-1986 winter, North set into motion a
series of projects involving Israel. These took advantage
of the close working relationship North had developed with
his counterpart in the Israeli Government, Amiram Nir, the
adviser on terrorism to Prime Minister Peres."
P. 33 - "Nir carried a proposal [in January 1986] that the
profits Israel would generate from the Iranian arms sales
would be used, in part, for a series of covert operations in
Lebanon. These would include gathering intelligence on
terrorist groups, seeking the release of American and
Israeli hostages, extending American influence through local
political alliances, and financing propaganda broadcasts
from radio stations that would be operated covertly. North
recorded in his notebooks that Nir had suggested on
January 9 that, from the sale of the first 1,000 TOWs to
Iran for $10 million, $2.5 million would be dedicated for
'Ops. I Each project received a code name in the sequence
TA-1, TA-2, and so on. North told the Committees that the
projects had not progressed beyond the planning stage and,
therefore, he did not seek a presidential Finding
authorizing any of these operations."
P. 34 - "North testified that he discussed the Enterprise's role
in these projects with Poindexter, but Poindexter said he
did not recall such a conversation. The only evidence that
the President knew of these sensitive projects appears in a
September 15, 1986, memorandum from North to Poindexter.
North asked Poindexter to brief the President on certain
initiatives, including one of the proposed joint
U.S.-Israeli covert operations. The memorandum stated that
'covert funds could be made available' for this operation,
but the source of the funds was not disclosed. Poindexter
noted in the memorandum that he approved North's recommenda-
tion to brief the President and that it was 'done.' Poin-
dexter testified that he did not know or tell the President
that the covert funds referred to by North were coming from
the Enterprise."
5
P. 47 - "The Erria was in a sense a metaphor for the Enterprise
-- a venture that began with ambitious expectations but
accomplished nothing. But the fate of the Enterprise cannot
obscure the danger of privatization of covert operations or
the fact that the participants in the Enterprise had
audacious plans for covert operations. Had the Enterprise
been emboldened by success, and not frustrated by failure,
the Committees can only conjecture with apprehension what
other uncontrolled covert activities on behalf of the United
States lay in store."
THE WHITE HOUSE
WASHINGTON
November 4, 1987
MEMORANDUM FOR ARTHUR B. CULVAHOUSE, JR.
FROM:
ALAN CHARLES RAUL A8
SUBJECT:
Declassification of Report: "Powers of Congress
and the President in the Field of Foreign Policy"
This section of the Report is 21 pages long and arrived for
declassification on November 2. The salient points are noted
below:
P. 1 - "Under our Constitution, both the Congress and the
Executive are given specific foreign policy powers. The
Constitution does not name one or the other branch as the
exclusive actor in foreign policy. Each plays a role in our
system of checks and balances to ensure that our foreign
policy is effective, sustainable and in accord with our
national interests.
Key participants in the Iran/Contra affair had serious
misconceptions about the roles of Congress and the President
in the making of foreign policy. Poindexter testified,
referring to his efforts to keep information about the
covert action in support of the Contras from the Congress,
'I imply did not want any outside interference. North
testified, 'I didn't want to tell Congress anything' about
this same covert action. In Poindexter's and North's view,
Congress trespassed upon the prerogatives and policies of
the President, and was to be ignored or circumvented when
necessary. If Congress denied the President funds to
implement his foreign policy, they believed that the
President could, and should, seek funds from private parties
and foreign governments. If Congress sought to investigate
activities that were secretly taking place, they believed
Executive branch officials could withhold information to
conceal operations. These practices were required, in their
judgment, to promote the President's policies.
The argument that Congress has but a minor role in foreign
policymaking is contradicted by the language of the
Constitution, and by over 200 years of history; it is also
short-sighted and ultimately self defeating
....
these
Committees have set forth the record of the
misrepresentations, half-truths, and concealment employed by
some within the Executive branch to prevent Congress from
learning about the NSC staff's covert activities. Here, we
note that the attitude that motivated this conduct was based
2
on a view of Congress' role in foreign policy that is
without historical or legal foundation. American foreign
policy and our system of government cannot succeed unless
the President and Congress work together."
P. 4 - "The only foreign policy powers expressly granted to the
Executive in the Constitution are the powers to nominate
Ambassadors, to negotiate treaties, and to direct the Armed
Forces as Commander-in-Chief. Two of these powers are
specifically conditioned on Senate approval: the Senate,
through its power of advise and consent, can confirm or
reject Ambassadors and ratify or reject treaties.
On the other hand, the Constitution expressly grants
Congress the power to regulate foreign commerce, to raise
and support armies, to provide and maintain a navy, and to
declare war. Congress is given the exclusive power of the
purse. The Executive may not spend funds on foreign policy
projects except pursuant to an appropriation by Congress.
P. 7 - "Judicial opinions, thus, have consistently recognized
that Congress shares with the President powers in the
conduct of foreign policy and also shares with him the right
of access to, and the duty to protect, sensitive national
security information.
"In urging a broad interpretation of presidential power,
various witnesses before these Committees involve the
Supreme Court's 1936 decision in United States V.
Curtiss-Wright Corporation. Their reliance on this case is
misplaced.
P. 8 - " The case involved the question of the powers of the
President in foreign policy where Congress expressly
authorizes him to act; it did not involve the question of
the President's foreign policy powers when Congress
expressly forbids him to act.
In Curtiss-Wright the Court upheld broad delegations by
Congress of power to the President in matters of foreign
affairs. Writing for the Court, Justice Sutherland said
that legislation over the international field 'must often
accord to the President a degree of discretion and freedom
from statutory restriction which would not be admissible
were domestic affairs alone involved.'
P. 9 - "Some have tried to interpret this passage as stating that
the President may act in foreign affairs against the will of
Congress. But that is not what it says. As Justice Jackson
later observed, the most that can be drawn from Justice
Sutherland's language is the intimation 'that the President
might act in external affairs without congressional
authority, but not that he might act contrary to an Act of
3
Congress. More recently, in Dames & Moore V. Regan, the
Supreme Court cautioned that the broad language in
Curtiss-Wright must be viewed only in context of that case. "
P. 13 - "In testifying before these Committees, North and
Poindexter indicated their view that whatever power Congress
may have in foreign policy derived solely from its power of
the purse. They reasoned that SO long as public money was
not expended, Congress had no role and the President was
free to pursue his foreign policy goals using private and
third-country funds."
P. 14 - "North said the President 'was fully within his rights to
send us off to talk to foreign heads of state, to seek the
assistance of those foreign heads of state to use other than
U.S. Government monies, and to do so without a finding.'
Admiral Poindexter supported the concept of circumventing
congressional opposition to the President's foreign policy
by using nonappropriated funds:
'Congress has put some restrictions on the
use of proposed funds. Those restrictions
didn't apply to private funds. They didn't
apply to third-country funds.
And the restrictions in the Boland Amendment,
as I have said, did not apply to the NSC
staff.
I
These claims by North and Poindexter strike at the very
heart of the system of checks and balances. To permit the
President and his aides to carry out covert actions by using
funds obtained from outside Congress undermines the Framer's
belief that 'the purse and the sword must never be in the
same hands.
P. 16 - "Allowing foreign policy to be conducted with funds
supplied by private parties and foreign governments opens
the door to expectations to return favors and corruption of
our system of government. Such schemes of financing
undermine the powers of Congress as a coequal branch,
subvert the Constitution, and can destroy the public's
confidence in, and control over, government. Our whole
system of law and government rejects this idea.
As President Reagan told a joint session of Congress
on April 27, 1983: 'The Congress shares both the power and
the responsibility for our foreign policy. "
P. 18 - "In remarks to Admiral Poindexter near the end of
Poindexter's testimony before these Committees, a Republican
member of the House Select Committee highlighted the need
for honest consultation where the Constitution divides power
among branches of government: 'The reason for not
4
misleading the Congress is a practical one. It is stupid.
It is self-defeating because while it may, in fact, allow
you to prevail in the problem of the moment, eventually you
destroy the President's credibility.
P. 19 - "The Constitution divided foreign policy powers between
the legislative and executive branches of government. That
division of power is fundamental to our system, and acts as
a check on the actions of each branch of government. Those
who would take short-cuts in the Constitutional process --
mislead the Congress or withhold information -- show their
contempt for what the Framers created. Short-cuts that
bypass the checks and balances of the system, and excessive
secrecy by those who serve the President, do not strengthen
the President. They weaken the President and our
Constitutional system of government. "
THE WHITE HOUSE
WASHINGTON
November 6, 1987
MEMORANDUM FOR ARTHUR B. CULVAHOUSE, JR.
FROM:
ALAN CHARLES RAUL ASR
SUBJECT:
Declassification of Report: "NSC Involvement
in Criminal Investigations and Prosecutions"
This section of the Report is 63 pages long and arrived for
declassification on November 4. The salient points are noted
below:
P. 1 - "During the period covered by the Boland Amendment,
Federal law enforcement agencies conducted investigations
that touched upon various aspects of the secret Contra
support operation. Concerned that these investigations, if
pursued, would expose the NSC staff's covert operations,
North and Poindexter reacted by contacting the agencies
involved. They sought to monitor investigations and, in
some cases, to delay or impede their process by suggesting
that national security was at stake. Confronted with such
assertions from White House officials involved with the
nation's security, law enforcement agencies understandably
cooperated with the NSC staff by delaying some investigations,
arranging to move a convicted foreign official whom North
was afraid would disclose facts about the Contras to a
minimum security prison, and giving Poindexter and North
information about other investigations.
The Committees are aware of seven such episodes, three
involving the United States Customs Service and four
involving the Department of Justice. They represent an
integral part of the NSC's staff efforts to keep their
operations even from those with legitimate law enforcement
interests."
P. 10, 22n - "North related to Spivey a number of stories
supposedly showing support, both overt and covert, for
various facets of the Enterprise. North's claims, the truth
of which the Committees have been unable to verify,
suggested that President Reagan, Attorneys General William
French Smith and Edwin Meese, and others, engaged in various
activities designed to impede the progress of investigations
into North's activities and that the President had called
Tom Posey a 'national treasure. The Committees have been
unable to corroborate any of North's claims related to
Spivey."
2
P. 18 - "According to [Assistant U.S. Attorney] Feldman, Castillo
also spoke of North warmly as 'the person who introduced me
to the President of the United States last week.
P. 21 - "According to Liewant, when he arrived at Kellner's
office with the printout [of the Boland Amendment], only
Kellner, Barnett, and Feldman were present and Kellner was
on the telephone talking to someone at the Department of
Justice. According to Liewant, when Kellner hung up, he
turned to Barnett, Feldman, and Liewant and said that the
Department wanted them to 'go slow' on the investigation.
Liewant could tell from Kellner's expression and tone of
voice that Kellner was disdainful of that suggestion and had
no intention of actually slowing the investigation."
P. 22 - "If Liewant's account of this meeting is correct, the
Department of Justice would appear to have been exerting
improper influence to delay an investigation, albeit
influence brushed aside by Kellner. But each of the other
participants in the April 4 meeting deny that any such
telephone conversation took place. Richard, Trott, Jensen,
and Meese also deny that any telephone call like that
described by Liewant occurred or that anyone, to their
knowledge, attempted to slow the investigation at any time. "
P. 23 - "On April 12, Meese, along with Jensen and Revell,
arrived in Miami to visit a number of FBI agents wounded in
a shoot-out the day before. Kellner accompanied Meese on
his visits.
During the day, Meese pulled him aside and asked him about
the Garcia investigation. Kellner believes that he told
Meese that there did not appear to be much substance to the
assassination allegations, but that the gun running
investigation was continuing. Kellner testified that Meese
neither stated nor implied that the investigation should be
slowed or conducted in any other particular manner.
Meese recalls asking Kellner about the matter, although he
does not recall pulling Kellner aside to do so. Meese
testified that he mentioned that case in particular because
it had received attention by the press. Meese also denies
that he attempted to affect the course of the investigation."
P. 28 - "On August 29, 1986, Kellner told Feldman to suspend any
further investigation on the matter until he (Kellner)
returned from an impending trip to Washington. According
to Feldman, Kellner told him that 'politics' were involved.
Feldman found this statement surprising and disturbing,
because it was the first, and only, time Kellner had
indicated to him that such considerations were relevant.
When Kellner returned from Washington shortly thereafter, he
told Feldman to proceed.
3
Kellner confirmed Feldman's version of this incident.
According to Kellner, shortly before he was to leave for
Washington he received a letter from John Hull making
serious allegations of impropriety by members of Senator
Kerry's staff, who were also investigating Garcia's
allegations. Hull also had included affidavits from some of
the imprisoned mercenaries retracting some of their prior
statements regarding gun running and Contra support.
Kellner stated that he feared that he was being put into the
middle of a political dispute, and wanted to talk to Mark
Richard about the allegations before proceeding further.
After that discussion, Kellner immediately authorized Feldman
to proceed. Both Feldman and Richard confirmed this
explanation."
P. 30 - "Upon receiving approval from Kellner, Feldman proceeded
with the investigation. The Independent Counsel subsequently
declined to take over the case and Feldman was continuing to
investigate the matter at the time he was deposed by the
Committee
the NSC staff's undertook to persuade the
Department of Justice to reward 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.
Brigadier General Jose Abendenzo Bueso-Rosa was Chief of the
General Staff of the Honduran Armed Forces in the early
1980s. According to a North PROF to Poindexter, Bueso-Rosa
was the Honduran military commander with whom North,
Negroponte, General Gorman, and Dewey Clarridge arranged for
bases for the Contras as well as overall logistics, training
and support.
On January 9, 1985, Bueso-Rosa and the three other Hondurans
were indicted in the Southern District of Florida for
conspiracy to assassinate the President of Honduras.'
P. 33 - "The objective of this exercise, as North put it, was 'to
keep Bueso 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.
P. 36 - "Richard soon determined that neither Trott nor Kellner
had any objection to redesignating Bueso-Rosa to [minimum
security prison at] Elgin, as contemplated in the original
court's recommendation and made the appropriate arrangements
with the Bureau of Prisons. "
P. 40 - "An FBI agent interviewed North on July 18, 1985.
According to the agent, North said that he had referred the
4
fake] 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."
P. 44 - "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 Glen 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.
P. 46 - "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 they 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. "
5
P. 47 - "In March 1986, Secord had retained Glen Robinette, a
security consultant and former CIA officer, to conduct a
private investigation of some of the individuals
ultimately involved in the Honey/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 of Sandinista leaders.'
P. 48 - "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."
P. 50 - "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 all
enforcement agencies by misusing claims of national
security."