Friday, January 28, 2022

Iran-Contra Pt 3: Arms Deals with Iran

Iran Contra Scandal: Arms for Hostages Deals with Iran

   The second element in the Iran-Contra scandal were the arms for hostages deals. At the time they were the most controversial aspect of the scandal. Iran and it’s ally Hezbollah had inflicted a series of humiliations on the US that began during the Iranian Revolution and escalated during the war on Lebanon. The Iran Hostage Crisis, the US embassy bombing in Beiruit, the kidnapping of CIA Chief of Station William Buckley and most dramatically the Marine barracks bombing in Beirut. The US had branded Iran a state terror sponsor and the State Department and CIA had launched Operation Staunch to pressure the whole world to stop selling arms to Iran. The US was allied with Saudi Arabia and other Gulf Monarchs in backing Iraq in the Iran/Iraq war. Reagan had publicly called Iran “Murder Incorporated” and claimed the US would never negotiate or make concessions with terrorists. Yet at the same time as Reagan was publicly condemning Iran the US was supplying them with thousands of anti-tank missiles, helping Iran rebuild it’s air defenses and providing it with intelligence that managed to shift the balance in the Iran/Iraq war in Iran’s favor. This was all in an effort to free seven American hostages in Beirut. Of course the deeper geopolitical purpose was to prolong the Iran/Iraq war making it as bloody and destructive as possible a goal the Israeli Mossad veteran David  Kimche  openly admitted. President Ronald Reagan over ruled objections from his own cabinet  to carry the deal out. Even when warned that he could face impeachment and prison Reagan pushed for the deals to continue. Among Reagan’s cabinet only Vice President George H. W. Bush and CIA Director Bill Casey consistently supported the continuation of the arms for hostage deals. At a lower level North and Secord once they were brought in on the deals, also consistently backed the plans as they benefited “The Enterprise.” Secord was able to turn a profit while North was able to funnel money to the Contras in Nicaragua.

   The Iran-Contra investigations failed to investigate the true origins of the Iran arms for hostages deal. First there had been the role of the Shah’s Iran as one of the top customers of America’s military industrial complex. In the final years of the Shah’s reign Richard Secord had headed the Military Assistance program in Iran helping his arms dealing friends generate vast profits. When the Iranian revolution overthrew the Shah the Rockefeller family interests in the form of Chase Manhattan bank were worried the new Iranian government might withdraw  the hundreds of millions Iran had deposited in their bank. They had helped to launch the career of President Carter’s National Security Adviser Zbigniew Brzezinski. Brzezinski convinced Carter to allow the exiled Shah into the US for cancer treatment. Back in Iran many thought the US was preparing to launch another coup like the one that had toppled Mossadegh and installed the Shah back in 1953. In protest of the US admission of the Shah and in hopes of finding out what the US was plotting a group of Iranian students seized the embassy. They captured 52 Americans on the embassy staff officials of the state department, the CIA, and the military. They also seized all the files documenting decades of US support for the Shah’s dirty war on the Iranian people. The Hostage Crisis began on November 4 1979.  President Carter retaliated by freezing Iran’s overseas accounts allowing Chase-Manhattan to keep Iran’s money. This at least is one simplified version of events the Iranian revolution was far more complex then most realize and in fact went  through two stages. First the initial overthrow of the Shah by broader movement that included left wing forces and nationalists. Second the triumph of Ayatollah Khomeini and the Islamic revolution. Also there is evidence that the rise of Khomeini and the whole hostage crisis were manipulated by western intelligence. Iran’s mullahs had long been on the CIA payroll since the days of the 1953 coup. Iran is by no means a puppet of the US or it’s allies. Iran remains one of the few countries willing to stand up to the US and Israel. However despite the hostile rhetoric from both sides secret deals were made between the US and Iran.

   President Jimmy Carter began a year of efforts to rescue or negotiate the release of the hostages. However unknown to Carter or his administration he was being targeted for a soft coup by the GOP, disgruntled elements of the CIA, and big business in the form of David Rockefeller and his allies. It became known as the “October Surprise” a term for last minute manipulations in October aiming to alter the election results in November. The GOP were obsessed with the idea Carter would free the hostages in October 1980 swinging the election in his favor. Yet the GOP began to manipulate events far earlier then October 1980. The first secret deals between the GOP and the Khomeini faction took place at least as early as March 1980.  Reagan’s campaign manager was OSS veteran Bill Casey. Casey set up an October Surprise group to monitor Carter’s efforts to free the hostages. Elements within the Carter administration like Donald Gregg at the NSC and Robert Gates at the CIA were leaking information to Casey. Bush had his own CIA agents for Bush contingent which included Robert Gambino. Many CIA agents for Bush would join Casey’s October surprise group once Reagan picked Bush as Vice Presidential candidate.

   To negotiate with Iran Carter’s administration had picked Cyrus Hashemi.  Cyrus and his brother Jamshid Hashemi had close ties to Mehdi and Hassan Karrubi in Iran. (Hassan Karrubi and Cyrus Hashemi would both be deeply involved in the Iran Contra scandal.) The Hashemi brothers were also close to Admiral Madani who was the main rival of Iran’s President Bani Sadr. Unknown to Carter Cyrus Hashemi had close ties to Bill Casey through Lebanese American businessman John Shaheen. Casey had done legal work for them and had known Shaheen for decades. Cyrus Hashemi became a double agent for the Reagan campaign initially providing them intelligence on Carter’s negotiations and then acting as a middleman to set up negotiations between Casey and the Iranians. Cyrus Hashemi’s bank First Gulf and Trust had been used by the CIA, the Shah’s Family, and the new Iranian government to move money. It had close ties to BCCI an infamous CIA backed bank whose clients included drug cartels and terrorists. 

   A series of meetings were held. In March 1980 Reagan crony Earl Brian (who served as Secretary of Health under Governor Reagan) and Robert “Bud” McFarlane (who would later set the Iran Contra arms for hostage deals in motion) along with Bill Casey met in Madrid with Iranian Mehdi Bazargan (Close to Hashemi’s contact Mehdi Karrubbi) to arrange a deal whereby Iran would refuse to release the hostages until after the election in exchange for massive shipments of arms and other concessions. The Israeli’s were also in on the deal. Israel had begun selling arms to Iran back in September of 1979 and would act as middleman in the October Surprise arms deals. After the Madrid meet Israel supplied Iran with 300 tires for Iran’s F4 fighter jets in March 1980. Iranian born Israeli Ari Ben Menashe would play a major role in the arms deals and in later exposing the October Surprise. In return the Reagan Administration would turn a blind eye as Israel sold nearly a billion dollars in arms to Iran in the early 1980’s.  Bush’s man ex-CIA Ted Shackley would later meet with the Iranians in London and Hamburg and was Bush’s point man on October Surprise. A Bush memo was uncovered revealing Bush later told Richard Allen (who would go on to be Reagan’s first National Security Adviser) to contact Shackely with any last minute details on Carter’s hostage. negotiations. Shackley was also close to Michael Ledeen who was involved in the October surprise and the “BillyGate” scandal targeting Carter’s brother. In July of 1980 Hashemi would begin a series of secret meetings with Iranian representatives including Mehdi Karrubi in Madrid. After meeting with Khomeini Karrubi requested another meet with Casey that was held in August 1980.

   Meanwhile the Carter administration was working from a hard bargaining stance completely unaware that the Iranians had already gotten a better offer from the GOP. On April 24 1980 the US mounted a disastrous rescue attempt “Operation Eagle Claw” either through bad luck, incompetence, or sabotage it ended in complete disaster when two of the helicopters crashed in the Iranian desert landing zone called Desert One. Eight men from the US military died in the crash the others were forced to flee as they no longer had enough helicopters to carry out the rescue. The corpses of the dead Americans were paraded through Tehran enraging the US public and humiliating Carter. Richard Secord, Robert Dutton, and Richard Gadd future members of “The Enterprise” were all involved in the hostage rescue plans. The failure would lead to a massive re-expansion of the Special Forces that began under Carter growing under Reagan and continuing to expand into our own time.

   In September 1980 Carter’s luck was finally poised to change. Iran’s President Bani Sadr had learned of the GOP’s secret deal with Khomeini and planned to go public on September 8 1980. To keep him quiet Khomeini agreed to reopen negotiations with the US. Iran was also worried about an increasingly hostile Iraq. Khomeini sent Sadegh Tatabani to make a deal and Carter’s negotiators seized on the opportunity. Yet once again Brzezinski’s machinations would sabotage Carter. Brzezinski had convinced Saddam Hussein’s Iraq to invade Iran the war began on September 22 1980 and Tatabani was unable to return to Iran because Iraq was bombing the Tehran airport. In late September or early October the Iranians would meet with GOP representatives at the L’Enfant Plaza Hotel in Washington DC where Israeli Housang Lavi, Americans Richard Allen, Robert McFarlane, and Lawrence Silberman met with Iranian representatives. (President Reagan would later appoint Silberman a judge  and Judge Silberman would overturn North and Poindexter’s Iran Contra convictions) The DC meeting was followed by a meeting at the Ritz Hotel in Paris October 17-18 1980 attended by Bill Casey and Vice Presidential Candidate George H. W. Bush along with Robert McFarlane, Robert Gates, Donald Gregg and George Cave . The Iranians agreed to hold the hostages until after the inauguration. It was bad enough the GOP was convincing the Iranians to hold onto the hostages until after the election. Now it wanted Iran to hold onto them even longer so that Reagan could come into office with a boost in popularity. To cement the deal a French Israeli arms shipment was sent to Iran on October 23 1980 consisting of 250 F4 spare tires and M6 tank spare parts. On November 4, 1980 the US election was held on the one year anniversary of the start of the hostage crisis Carter lost to Reagan. On January 20, 1981 Reagan was inaugurated President and the hostages were released. The US was soon supplying Iran with hundreds of millions in arms through Israel, South Korea and it’s NATO allies. Israel used it’s knowledge of the “October Surprise” secret to get away with selling Iran nearly a billion dollars in arms in 1981-1983. Naive Americans believed the strange coincidence of the hostages being released on the day of the inauguration was because of Reagan’s tough stance on terrorism. By massively expanding Carter’s war in Afghanistan Reagan and Casey would play a major role in giving birth to Al Qaeda. The Reagan years would also see the origins of the same rhetoric and tactics of the later “War on Terror.”   Although Reagan did not personally take part in the October Surprise negotiations he was almost certainly let in on the secret. It is the only way to explain his obsession with pursuing the Iran-Contra arms for hostage deals despite their quickly evolving into a farce filled with lies and broken promises. The October Surprise would be covered up by Congress and most of the media. The October Surprise story has been confirmed by dozens of witnesses from around the world including former President Bani Sadr, Ari Ben Menashe, Ariel Sharon, Yasser Arafat, Alexandre DeMarenches (former head of French Intelligence and close Bush ally) Russian Intelligence, and the Iranian Government offered to send proof to Bill Clinton. 

   In the years that followed the bloody Iran-Iraq war would continue eventually claiming over a million lives. The US was busy supplying Iraq with arms via Egypt and the CIA provided the Iraqis intelligence to plan their attacks. In 1982 Israel invaded Lebanon and installed a puppet government. The Israeli’s had sparked the Lebanese civil war back in 1975 encouraging their fascist christian phalange allies to try to seize control of the country. Southern Lebanon was being used as a base for Palestinian forces to shell Israel. The Israelis were even more annoyed with them when the Palestinians maintained a ceasefire. In 1978 Israel had invaded and occupied Southern Lebanon but Carter had forced them to withdraw. Now with Reagan in office in 1982 Israel invaded Lebanon eventually creating a puppet state in Southern Lebanon. Southern Lebanon was also home to a huge Shiite population and with the aid of Iran’s IRGC they formed Hezbollah in 1982. The US became increasingly involved in Lebanon siding with the Israelis and the Phalange while pretending to be neutral peacekeepers. It would take Hezbollah nearly 20 years to force Israel to withdraw from Lebanon. Hezbollah would force the US to withdraw in just 1 year.  On April 18 1983 Hezbollah set off a van packed with explosives outside the US embassy 63 were killed. A dozen high level CIA personnel including their top Mid-East analyst Robert Ames who Casey had sent to Beirut. Robert McFarlane was sent as a special emissary to Beirut and he escalated US involvement in the war shelling and bombing Lebanese civilians. Then on October 23 1983 the Marine Barracks were bombed in Beirut by a huge truck bomb. 241 members of the US military were killed. The US claimed it wouldn’t pull out but quietly did. To distract the US public the US launched the Invasion of Grenada where it had just carried out a coup. Oliver North helped plan the invasion. 

   On March 7 1984 CNN journalist Jeremy Levin was kidnapped. Then on March 16 1984 the CIA station Chief William Buckley was kidnapped by Hezbollah on the way to work he was later sent to Iran for questioning under torture. His capture and worry over what he might reveal was a major factor in motivating the US to trade arms for hostages. Buckley would tell all to the Iranians and they transcribed his confession into a 400 page book. Buckley would die before he could be freed. Six more American hostages would be kidnapped by Hezbollah or it’s front groups in Beirut between May 8 1984 and June 9 1985. They were Reverend Benjamin Weir, Peter Kilburn (librarian at American University) Father Lawrence Martin Jenco (Catholic relief services), Terry Anderson (AP journalist) David Jacobsen (Hospital Director at American University) and finally Thomas Southerland (Director of Agriculture at American University) They were kidnapped to gain leverage to free the Dawa prisoners being held in Kuwait after a series of attacks on American and French targets there. Their kidnappings would provide the motivations or the excuse for the US to carry out the arms for hostage deals. Except for Jeremy Levin would seemingly escape after being ransomed.

   A key factor behind the Iran-Contra scandal that few delved into was a web of groups set up by Vice President George H.W. Bush that dealt with Crisis management and Counter-Terrorism. It was thanks to the key role that North played in the counter-terror network or as Peter Dales Scott calls it “a Cabal” that North became not just the point man for the Contras but also in charge of counter-terrorism and eventually in charge of the Iran arms for hostages negotiations. The “Cabal” included Admiral John Poindexter (NSC), Oliver North(NSC), Duane “Dewey” Clarridge (CIA) Charles Allen (CIA), Robert Oakley (State Department), Noel Koch (DOD) Lt Gen John Moellering (Joint Chiefs of Staff) and Oliver “Buck” Revell (FBI). They communicated via “Flashboard” a secret email system. NSDD (National Security Directive) 3 had put Vice President Bush in charge of crisis management back in 1982. Bush recruited North and his secretary Fawn Hall to work on crisis management. This lead to North drawing up Continuity of Government plans calling for declaring martial law, suspending the constitution, total surveillance, and rounding up tens of thousands of dissidents and hundreds of thousands of refugees in the event of nuclear war, terror attacks, or even civil unrest. Donald Rumsfeld and Dick Cheney would also be involved in these plans during the Clinton administration. They formed the blueprint for America’s post 9/11 response. Bush also created a Crisis Preplanning group and a Special Situations Group. North worked on the creation of a Crisis Management Center. In April of 1984 North Drafted an NSDD that created the TIWG (Terrorist Incident Working Group) 2 TIWG members would work closely with North, Craig Coy and Robert Earl. In July of 1985 President Reagan convened the Vice President’s Task Force on Combatting Terrorism. At the exact same time the US suddenly reversed it’s Iran strategy opening the door for the Iran arms for hostage deals Peter Dale Scott points out. On January 20 86 just as the US was preparing to make direct arms sales to Iran NSDD 207 put North in charge of Counter-Terrorism and set up a secret Office to Combat Terrorism run by Oliver North staffed by veterans of Bush’s Counter-terror cabal. Michael Ledeen and the Israeli Amiram Nir were also part of this counter-terror network and like North would play major roles in the Iran Contra Scandal along with Robert Oakley and Dewey Clarridge. Through counter-terror network Bush and North became close. Thanks to this shadowy network within the government Bush became as deeply embroiled in the Iran side of the scandal as he had been in the contra side. It was sort of the government equivalent of setting up a bunch of shell companies. The bloodiest incident in North’s war on terror was the attempt to assassinate a Hezbollah leader Muhammed Hussein Fadallah with a car bomb  80 people were killed in the attack but Fadallah survived. 

   Now it’s time to introduce North’s bosses at the NSC Robert “Bud” McFarlane and John Poindexter. “Bud” McFarlane was the son of democratic congressman in Texas. He graduated from Annapolis Naval Academy in 1959, was commissioned as a marine officer. McFarlane lead the first US combat unit in Vietnam. He studied in Switzerland and received a White House Fellowship. Al Haig Henry Kissinger’s deputy at the NSC brought on McFarlane as his military assistant. McFarlane came to regard Kissinger as his mentor and McFarlane was involved in his secret negotiations with China. McFarlane would later hope that his Iran initiative would earn him a similar place in history. He retired from the marines as a Lt. Colonel and served two years on the Senate Arms Services Committee under Senator John Tower. Tower was also involved in the October Surprise and was picked by Reagan to investigate/Cover-up the Iran Contra scandal. Once Reagan was President he picked Al Haig as his Secretary of State. Haig brought McFarlane on as a Counselor to the State Department. Then with Haig on the way out as Secretary of State McFarlane returned to the NSC as National Security Advised Willam Clark’s deputy. When Clark stepped down as National Security Adviser the Ed Meese, Michael Deaver, and Jim Baker faction called the “Troika”  which dominated the early Reagan Administration tried to appoint James Baker as the new National Security Adviser. Baker was a close friend of George H.W. Bush who has become infamous as the Bush family “Fixer.” Bill Casey blocked the appointment and McFarlane was chosen as the National Security adviser as a compromise. Since “Bud” McFarlane and Ollie North were both marine Lt. Colonels serving on the NSC and both workaholics they developed a sort of father son relationship and McFarlane came to rely ever more on North. McFarlane was also a longtime friend of Mossad veteran and director of the Israeli Foreign Ministry David Kimche. McFarlane put great trust in the advice of Bill Casey. McFarlane trust in both Casey and Kimche would lead him to plunge into the disastrous Iranian arms for hostage deals.

   Vice Admiral John Poindexter was McFarlane’s deputy at NSC and would succeed him as National Security Adviser in early December 1985. He was born in a small farming town in Indiana. He graduated top of his class at Annapolis Naval Academy then received a PHD in nuclear physics from the California Institute of Technology. He served under three Secretaries of the Navy and as executive assistant to the Chief of Naval Operations Admiral James Holloway. He also commanded a guided missile cruiser and a destroyer squadron. Poindexter was recruited to set up the computer network for Bush’s Crisis Management Center. He had IBM install a prototype version of the Internet at the NSC allowing North and the other Iran Contra conspirators to email each other via PROF messages. The NSC crisis management network linked the NSC computer network to the computer networks of the State Department, The CIA, the Pentagon, numerous law enforcement agencies, military bases around the world and foreign intelligence services. This was a few years before anyone in the general public knew what an email was. This would come back to haunt Poindexter, North and others when they deleted all their PROF messages only to have some low level research assistant to the Tower Committee figure out how to recover them all. On the internet nothing is ever really deleted. Poindexter was secretive and a bit more reckless then McFarlane. At the height of the Iran Contra scandal Poindexter would save Reagan by testifying to Congress (almost certainly falsely) that Reagan had not been informed of the diversion of funds from the Iran arms sales to the Contras.

   Adnan Khashoggi the Saudi Billionaire who the press dubbed “the world’s wealthiest man” had made a fortune being a CIA conduit for bribes to middle eastern officials to buy American weapons systems. He was famous for his yachts, lavish parties and high class call girl ring. One of Khashoggi’s call girls would bring down presidential hopeful Senator Gary Hart. Khashoggi was close friends with Donald Trump and sold him a yacht. Adnan was the  uncle of Jamal Khashoggi who made news when he was murdered in a Saudi Embassy in Turkey on orders of King Muhammed bin Salman back in 2018. Between 1983 and 1984 Khashoggi met frequently with “Bud” McFarlane at NSC trying to sell him on various schemes. In late 1984 Khashoggi would team up with Manucher Ghorbanifar on a scheme to sell arms to Iran in order to free the hostages. Iran was desperate for weapons the Iraqis soviet supplied tanks were smashing them on the battlefield. Iraq was bombing Iran and Iran was running out of missiles and parts for it’s air defense system. It would later emerge during the Iraqgate investigations that Vice President Bush had provided intelligence and encouragement for Iraq to bomb Iran to pressure Iran during the arms for hostage scheme but this was probably later.

   Manucher Ghorbanifar the middleman in the Iran arms deals was an arms dealer who had served in Savak, become an Israeli agent, and supplied information to the CIA that was so unreliable they issued a burn notice on him as a known fabricator after he failed too many lie detector tests. The Iranians were desperate enough for weapons that they were willing to use a known Israeli agent like Ghorbanifar. Ghorbanifar would become infamous for lying to both the Americans and the Iranians to get them to the bargaining table. Ghorbanifar’s Iranian contacts Hassan Karrubi and Mohsen Kangarlou had been involved in the earlier October Surprise negotiations. Ghorbanifar hoped to make millions off the Arms  deals. Oliver North was as big of a liar as Ghorbanifar practicing that special American brand of bullshitting necessary to the salesman or the sports coach. Desperate to gain the confidence of the American’s after the CIA had discarded him Ghorbanifar met with Theodore Shackley in Hamburg Germany on November 20 1984. Ghorbanifar warned (falsely) that Iran was in danger of becoming a soviet satellite in 5 years. Ghorbanifar wanted to buy TOW anti-tank missiles and offered to free the kidnapped CIA station chief William Buckley and to provide captured soviet equipment to the US. Ted Shackley was running a risk management firm Research Associates Inc. and was closely monitoring the Iran-Iraq war. Shackley had hired an Iranian named Razmara who introduced Shackley to the former head of the Savak’s Counter-Intelligence General Manucher Hashemi in October 1984 and Hashemi had arranged the meet with Ghorbanifar. According to veteran CIA Iran operative George Cave Shackley was working for the NSC. Shackley was also working for Vice President George H.W. Bush while ostensibly in the private intelligence business. Shackley was close to both Secord and Clines his “former” business partners. Shackley wrote up a memo on November 22 1984 and sent it to Vernon Walters Reagan’s ambassador at large and fellow CIA veteran infamous for his role in the 1964 coup in Brazil. Walters forwarded the memo Robert Oakley the State Department’s point man on counter-terrorism (Part of the Bush/North Counter terror network) and to Assistant Secretary of State for the Near East Richard W. Murphy. Because of Ghorbanifar’s dubious reputation the offer was initially rejected. By March 1988 Shackley’s memo landed on NSC consultant Michael Ledeen who claimed (probably falsely) that he never read it but forwarded it to Oliver North. Ledeen was another of Shackley’s friends from the October Surprise days.

    Michael Ledeen would jump start the languishing Iran arms for hostages deal. Ledeen was a CIA press asset, a contractor for Italy’s SISMI intelligence agency along with Shackley. In Italy Ledeen would help cover up GLADIO and spread the myth of the Soviet Union being behind all the world’s terror attacks. Ledeen had close ties to Israeli intelligence, was a far right neo-con, and had earlier befriended Israeli Prime Minister Shimon Peres when Ledeen was sent to infiltrate the socialist international of which Peres’s Labor Party was a member. Currently Ledeen was a consultant on counter terrorism at the NSC. Ledeen got McFarlane’s permission to travel to Israel to explore using Israel’s contacts to gain intelligence on Iran. Once in Israel the Israelis introduced Ledeen to the Iranian Manucher Ghorbanifar, the Saudi Adnan Khashoggi, along with two Israeli arms dealers Adolph Schwimmer  and Yaacov Nimrodi. They had a pile of disinformation to sell Ledeen along with the promise to free the seven American hostages. The disinformation was that Iran was in danger of falling into the soviet orbit, but that Ghorbanifar was in contact with a pro-western faction that hoped to take power once Khomeini was dead. Supposedly Iran was divided into 3 factions a pro-soviet faction, a neutral faction, and a pro-western faction. Ghorbanifar promised to put the US in contact with the “Moderates.” In reality Iranian politics in the Islamic republic had nothing to do with such simple cold war dynamics. There were no pro-soviet factions and no pro-american factions. Back in 1983 a Soviet defector had supplied the CIA with a complete list of KGB assets and Casey decided to send the list to Iran. Khoemeini had them killed or arrested. However like most countries Iran was ruled by ruthless pragmatists who were willing to buy arms from Israel or the US because of the Iran-Iraq war. Arms procurement was controlled by Iran’s IRGC the revolutionary guard but they were used to operating through Iranian exiles and shady characters like Ghorbanifar. While in Israel Ledeen also met with Israeli Prime Minister Shimon Peres and David Kimche the director general of the Israeli Foreign ministry a Mossad veteran. Kimche would go on to advise the greatest mass murderer of recent times Rwanda’s President Paul Kagame in the 1990’s. Kimche would fly to Washington DC to meet with McFarlane a couple weeks after Ledeen’s return. When Ledeen met with the Israeli Prime Minister Peres vouched for Ghorbanifar, Khashoggi, Schwimmer, and Nimrodi and asked Ledeen to deliver a personal message to “Bud McFarlane.” Schwimmer was a major backer of Peres and the Iran deal was meant to reward him. The Labor party had been cut out of the lucrative arms market by the Likud party, the Mossad, and the Israeli defense department and Peres hoped that with US backing his cronies could get into the Iran arms sales business. 

   Returning to the US Ledeen briefed McFarlane on the arms for hostage deal and passed on Peres’s message. McFarlane bought the cover story on Iranian moderates and hoped that by bringing Iran back into the US orbit he would earn his place alongside his mentor Kissinger in the history books. CIA director Bill Casey encouraged this delusion he intentionally kept the CIA’s top Iranian analysts reports from reaching the NSC lest they discredit the cover story about selling arms to Iranian moderates. Instead Casey had Graham Fuller (later infamous for his role backing al Qaeda style groups in Central Asia) write a report calling for a complete reversal  on US policy towards Iran. Soon the NSC had a draft finding on a new Iran policy that would enable the Iran arms for hostage deals to go forward. Now it was a decision for the President and his NSPG (National Security Planning Group a modified NSC.) The idea was strongly opposed by both Secretary of State George Schultz and Secretary of Defense Caspar Weinberger. Casey, McFarlane, and Vice President Bush supported the arms for hostages scheme. The idea got a boost in June 1985 when Iran and Syria helped negotiate the release of the TWA 847 hostages being held in Beirut after their plane was hijacked by a Hezbollah front Islamic Jihad. Israel freed hundreds of shiite prisoners it was holding in exchange. The deal was brokered by Iranian speaker of the parliament Ali Akbar Hashemi Rafsanjani who was also a key player behind the scenes on the arms for hostage deals. The decisive voice belonged to President Ronald Reagan and he was in favor of going ahead. President Reagan gave the final green light to McFarlane on July 13 1985 while in the hospital recovering from a polyp operation.

   Manucher Ghorbanifar had promised to free all of the hostages once 100 TOW anti-tank missiles were delivered. Israel was to act as the middle man it would ship TOWS from it’s own stocks and the US promised to send replacements. To finance the deal Ghorbanifar borrowed $1 million from Khashoggi. Yaacov Nimrodi and Al Schwimmer charged Ghorbainfar $10,000 for each missile. The Israeli Defense Ministry sold them to the two Israeli arms dealers for only $6,000 each.  Ghorbanifar charged Iran $12,000 for each TOW. On August 20 1985 Israel delivered 96 TOW missiles to Iran choosing the defective or obsolete TOWs from their stockpile. (apparently TOWs are shipped in 8 packs) On landing in Iran the IRGC immediately seized the TOWs. No hostages were released. Ghorbanifar used the excuse that since the IRGC not the “Moderates” had gotten the missiles the moderates hadn’t freed any hostages. However Ghorbanifar had a new deal for 400 more TOW missiles plus the 4 TOWs Israel owed them from the first shipment Iran would get a hostage freed. Amazingly the arrogant US agreed to this second deal after Ghorbanifar had failed to deliver the first time. On September 15, 1985 Israel delivered 408 TOWs to Iran. Within hours the hostage Reverend Benjamin Weir was released. The US had hoped to free CIA station chief William Buckley first, Casey had even played Reagan a video of Buckley being tortured. The Iranian’s claimed Buckley was to ill to travel in reality he had died in June of 1985.

   Iran now hoped to rebuild it’s air defenses with the next deal. The Iranians were now demanding HAWK surface to air missiles and Phoenix missiles. The US refused to sell the Phoenix missiles which it didn’t even supply to most of it’s allies. It agreed to sell the HAWKs however. The deal was for 120 IHAWK missiles Iran would pay 18 million or $225,000 each. IHAWKS were the more advanced version. The plan was for Israel to ship them to Iran via Portugal. This is when Oliver North was recruited to run the Iran arms for hostages deals. At first McFarlane had put North in charge of replenishing Israeli stocks. McFarlane was busy preparing for the arms control summit in Geneva. However Portugal was refusing permission to allow the missiles to land and take off from their country. On November 17 1985 Israeli defense minister Yitzhak Rabin called North to fix the problem and McFarlane called soon after to confirm that he had referred Rabin to North. North brought in Secord who’s partner Tom Clines had close contacts with the Portuguese arms company DEFEX. However DEFEX had strong ties to the party that had recently been voted out of office instead of the new government. The HAWK deal quickly turned into a fiasco. Secord’s attempt to hold an unscheduled meeting with the foreign minister at the airport only upset Portugal. The US embassy was ignorant of the deal and told Portugal not to approve it. North brought in Duane “Dewey” Clarridge serving as the CIA’s head of European operations to get the CIA’s help in pressuring Portugal. Al Schwimmer lost patience and tried to send the plane in without clearance hoping the problem would be solved before it landed. The plane was forced to turn around and it’s lease ran out. The Israeli’s agreed to pay Secord’s “Enterprise” 1 million for transport. Dewey Clarridge called Langley to get the name of a CIA controlled airline St. Lucia. This would raise also sorts of legal problems once the scandal broke. To engage in a covert operation the CIA needed a Presidential finding. Anyways the St. Lucia plane was smaller then the one Schwimmer had rented and could carry fewer missiles. Secord arranged for the flight to be rerouted through Cyprus and then over Turkey to Iran. Cyprus didn’t give official permission but someone probably paid off the right people as no one interfered. On November 25, 1985 18 HAWK missiles arrived in Iran. The Iranians were furious they were not the IHAWKS they had been promised but the less advanced HAWKS and Israel hadn’t bothered to scrape off the “stars of David” on them. Ghorbanifar called North in a panic warning the Iranians were furious and the hostages lives were in danger. Back at the CIA Casey’s more cautious deputy director John McMahon demanded that a “retroactive” Presidential finding be created to cover for the CIA. A retroactive finding was created and signed by President Reagan December 5 1985 and then thrown into an NSC safe. The whole point of a finding was to inform congress and there was not supposed to be any such thing as a retroactive finding. On December 4 1985 President Reagan had  announced that McFarlane was resigning as National Security Adviser to be replaced by Admiral John Poindexter. McFarlane was getting increasingly frustrated with the Iran arms deals he wanted all the hostages freed first before more weapons were sent and was beginning to realize that he had been duped about the possibility of installing a “moderate” government in Iran. After the scandal broke in November 1986 Poindexter would burn the retroactive finding because it clearly showed an arms for hostage deal.

   North had another scheme to free the hostages alongside the Iran arms for hostages deal. Two DEA agents William Dweyer and Frank Tarallo had come to North with a scheme to use an informant they had in Beirut a major drug trafficker to act as middle man in arranging to ransom the hostages. North turned to Texas Billionaire H. Ross Perot to provide the ransom. Perot made his money in electronics and so had tight ties with the intelligence community. During the Iran hostage crisis he had managed to free 4 of his employees. There were a couple attempts to ransom a hostage in Beirut ending in failure. The first try the informant claimed he had spent $300,000 in bribes and was suspected of pocketing some of the money. Another time North planned to treat the ransom with a chemical that would cause the money to disintegrate days later a scheme which would have damaged all future hostage negotiations. Finally the deal fell through when the informant demanded a million dollars up front. The DEA men refused. Perot was very angry over the failure but was consoled with a personal letter from Reagan thanking him for his efforts. It’s believed that during Perot’s involvement in the Iran Contra scandal he developed a lasting grudge against George H. W. Bush inspiring Perot to launch a third party campaign in 1992 that sabotaged President Bush’s re-election campaign.

   Between December of 1985 and January of 1986 the Iran arms for hostages deals would undergo a major shift. North blamed the Israelis for the fiasco with the IHAWKS, Schwimmer, Nimrodi and Kimche were to be cut out of the deals and replaced with Peres’ counter-terrorism adviser Amiram Nir. North and Nir had worked closely together on the Achille Lauro Hijacking back in October 1985. North’s plan to intercept the escaping Achille Lauro hijackers who had been offered safe passage by Egypt in exchange for releasing the hostages nearly provoked an armed clash between US special forces and the Italian Carabinieri on an Italian runway that the US air force had forced their plane to land on. Nir had been in constant contact with North during the crisis providing Israeli intelligence. Now Nir would replace Schwimmer and Nimrodi as the Israeli liaison to the operation. Then it was decided to cut the Israeli role as middlemen. The arms deals in 1985 had been illegal under the Arms Export Control Act. The Reagan Administration believed that a loophole in the economy act would make the deals legal. The new middleman would be Secord’s enterprise. The Pentagon would sell the weapons to the CIA, the CIA would sell them to Secord, and then Secord would sell them to Iran. 

   This scheme making the Secord’s Enterprise the middleman had the added bonus of allowing North to divert the profits to the Nicaraguan Contras. During the HAWKs deal Israel had paid the Enterprise $1 million to cover transport. But since the deal had been aborted after only 18 HAWKs were delivered the Enterprise only spent $200,000 renting the CIA plane and other on costs leaving them with $800,000 Israel allowed them to keep. North diverted some of this to the Contras. Now with the Defense department selling the TOW missiles for only $3,469 each and Ghorbanifar still paying $10,000 each the Enterprise would make a hefty profit on each missile. The new plans that January envisioned a series of deals whereby the US would sell Iran 4,000 TOW missiles and Iran would free 4 hostages. In addition to diverting money to the Contras North diverted some of the money to Nir’s scheme to train a 40 man team of Druze in Beirut that would carry out pre-emptive assassinations and perhaps even act as a hostage rescue force. On January 17 1986 President Reagan signed a finding authorizing the scheme to supply arms to Iran via the DOD, CIA, and the Enterprise. The new finding was kept secret from Congress. On February 17 1986 a shipment of 500 TOWs was shipped to Iran on Enterprise planes rented from Southern Air Transport the “former” CIA airline that was also being used to smuggle arms to the Contras. On February 27, 1986 another 500 TOW missiles were delivered. No hostages were freed.

   With the involvement of the Enterprise the deal had developed a momentum of it’s own. Even if no hostages were freed the Enterprise profited and the resources of North’s “off the Shelf” Project Democracy were expanded. Ghorbanifar was now promising direct contacts with the highest levels of the Iranian government. McFarlane would act as special envoy on a trip to Iran. Originally the meet was to take place on the Isle of Kish but the location was soon changed to Iran’s capital Tehran. Vice President Bush arranged to have the meeting delayed until after his planned visit to Saudi Arabia to avoid being asked awkward questions from an angry ally which hated Iran and was backing Iraq in the Iran-Iraq war. After a series of meetings in Europe with the Iranians to arrange the details plans were finalized. The US was to arrive bringing HAWK spare parts and upon their arrival all the hostages were to be freed. At least that was what Ghorbanifar told them. He told the Iranians that the Americans were bringing all the HAWK spare parts 15 million worth. Ghorbanifar had borrowed the money for the deal from Khashoggi.  

   On May 25, 1986 the McFarlane delegation arrived for the infamous Tehran meetings. They flew in from Israel where they purchased a chocolate cake and they brought along a bunch of revolvers and a small amount of HAWK spare parts. They had left the rest in Israel to be delivered once the hostages were freed. The delegation included McFarlane, North, Secord, Secord’s partner and Iranian exile Albert Hakim, ex-CIA George Cave, Howard Teicher of the NSC and a CIA radio man. Casey had given them cyanide pills in case the Iranians decided to hold them hostage. The meeting was badly timed taking place in the month of Ramadan when muslims fast during the day. The Iranians weren’t up to negotiating till after their evening meal. No one was there at the airport to meet the McFarlane delegation. Ghorbanifar arrived late and the delegation traveled to a hotel. Finally some low ranking Iranian officials arrived to negotiate. McFarlane was outraged at the slight. The Iranians were angry that the US hadn’t brought all the HAWK spare parts. The US realized that the Iranians hadn’t even begun to bargain to free the hostages. Then after Iran contacted Hezbollah, Hezbollah demanded Israel abandon it’s occupation of Southern Lebanon withdraw from the Golan heights and other just but costly demands. Gradually over the next couple days the negotiations began to improve higher level officials began to arrive, Hezbollah lowered it’s demands to freeing the Dawa prisoners. Reagan authorized the shipment of the remaining HAWK spares and Iran was promising to free 2 hostages if they could be given a little more time. To North and Secord’s disappointment McFarlane and Poindexter convinced Reagan to cancel the deal. They wanted all the hostages freed first and McFarlane was tired of waiting he wanted to leave Tehran. The Iranians begged him to stay for 6 more hours offering to free 2 hostages in exchange for the HAWK spare parts. McFarlane refused and on May 28, 1986 the plane carried the delegation back to Israel. On returning to the US to brief the president McFarlane advised Reagan to abandon the arms for hostage deals. However President Reagan and Oliver North had not given up hope yet. North would work hard to convince his boss Poindexter to abandon the “All or Nothing” approach and adopt the more realistic “Sequential” release approach. The Iranians were not about to give up all their leverage by freeing all the hostages in advance. Yet sequential release would ultimately prove futile as in September through October of 1986 Hezbollah would kidnap 3 more Americans Joseph Cicippio, Frank Reed, and Edward Tracy, while the arms for hostage deals would only get 3 hostages released meaning the total number of hostages would end up the same. It would take until 1992 for the final hostages to be freed.

   In June of 1986 after the failed Tehran meeting the Reagan administration began to plan a hostage rescue mission using Secord, the CIA and the pentagon. It proved too difficult to locate the hostages locations. North received a call from Nir and Ghorbanifar promising to free a hostage on the 4th of July. North excitedly told the Reagan and Bush. Expensive arrangements were made to escort the hostage home. Then on the 4th of July nothing happened North was made to look like a fool and refused to speak to Nir for weeks forcing Nir to go through Charles Allen at the CIA who would later be given the task of babysitting Ghorbanifar. On July, 25, 1986 Ghorbanifar and Nir finally came through and the hostage Reverend Lawrence Jenco was freed. Ghorbanifar was desperate to restart the arms for hostages deals. He was millions in debt to Khashoggi because Iran refused to pay him for the HAWK parts that had never been delivered during the Tehran meet. Ghorbanifar and Khashoggi had become ticking time bombs unless they were paid off they might go public. North considered paying off Ghorbanifar from the Enterprise’s coffers or convincing the Iranians to pay him off. On July 29 1986 Vice President Bush flew to Israel to meet with Nir who bragged that they were dealing with the most “radical elements” in Iran because they were the ones who could get things done. 


    Tehran had another disastrous result for Ghorbanifar it had convinced the Americans that they should find a “second Channel” into Iran their term for a 2nd middleman. Secord assigned his Iranian partner Albert Hakim to find one. Through his exile contacts Hakim was introduced to Ali Hashemi Bahramani the young nephew of Iran’s speaker of the parliament Rafsanjani and also a member of the IRGC. Poindexter and North were so pleased with Bahramani that they had Secord smuggle him to Washington DC for a meeting at the NSC’s offices in the Old Executive building. The. North took Bahramani on a white house tour and arranged CIA approved call girls for him and his party.

   On October 6-8 North Secord Hakim met with Bahramani  and other Iranians in Frankfurt to arrange the next arms deal. North brought a bible signed by president Reagan. North had to leave early Eugene Hasenfus was being paraded in front of international television after being shot down over Nicaragua. The Iran-Contra scandal was beginning to unravel but the Iran deals continued. The Iranians warned the Americans that 5 million pamphlets describing McFarlane’s visit had been printed in Tehran. Albert Hakim took over the negotiations agreeing on a 9 point plan with the Iranians to free all the hostages sequentially in exchange for HAWK parts, technical assistance 1500 TOWS, intelligence on Iraq and the freeing of the Dawa prisoners in Kuwait. On October 28 1986 500 TOWs were shipped to Iran. On November 2, 1986 just in time for the midterm elections hostage David Jacobsen was freed. The next day November 3, 1986 the Lebanese magazine Ash-Shiraa published an expose on the McFarlane visit to Tehran. The American press picked up the story and the controversy over the Iran Contra scandal exploded. Reagan went on TV and denied everything.

   The cover up went into high gear. Actually back in the fall of 1985 after Congressman Michael Barnes began demanding to see NSC documents on North’s contra resupply; McFarlane had OK’d North’s plan to start altering NSC files to cover up violations of the Boland amendment. Then once Hasenfus was captured Casey had warned North to start shredding documents. Now the whole Reagan Administration was desperate to cover up Iran Contra. On November 13, 1986 Reagan held a disastrous press conference claiming that there had been no arms for hostage deal and that the arms sent could fit on one small plane a blatant lie. On November 19, 1986 Reagan held another failed press conference where he claimed that no third country had been involved. 20 minutes later his aides issued a correction that there had been a 3rd country. Reagan was especially vulnerable on the Iran issue. His approval rating dropped from 67% to 46% during November 1986. Reagan had violated the Arms Export Control, sold arms to a country designated a terror sponsor and also conducted covert operations without any presidential finding. Violating the Boland amendment carried no legal penalty.

   Longtime Reagan loyalist Attorney General Ed Meese who had served under Reagan since his days as Governor of California took charge of the cover up. On November 21, 1986 Meese launched a formal inquiry into the Iran Contra affair he failed to involve the DOJ Criminal division and failed to take notes at important meetings with Casey, McFarlane, and Poindexter. Even as he was being supposedly investigated North was allowed to continue to shred documents. While North was busy shredding Meese’s Assistant Attorney General William Bradford Reynolds discovered the so called “diversion memo” North had written back in April of 1986 summarizing the history of the Iran arms deal and containing North’s plans to divert 12 million to the Contras. Meese saw it as a perfect opportunity to divert attention from Reagan’s illegal arms deals in 1985 and onto North the NSC and the diversion. North had long bragged that he was willing to take the fall for Iran Contra if necessary to protect the President. Poindexter had already offered to resign and after interviewing him Meese was certain that he would deny having told Reagan about the diversion. Reagan’s Chief of Staff Donald Regan was Meese’s partner in the coverup. He began to leak damaging info on McFarlane to the press. On November 25, 1986 Reagan announced that Meese had informed him of some shocking news, Meese then took the stage and revealed the diversion to the Press. He announced that Poindexter had resigned but North had been “relieved of his duties” meaning fired. North found out about it watching it live on TV. Then he received a call from President Reagan who told North he was an “American Hero” and that his life would make a great movie. North transferred back to the Marine corps.

   It would take another article or even a book to do justice to the whole aftermath once the scandal was exposed and this article is long enough already. I dealt with the aftermath back in the first part of my Iran Contra series. I also discuss it in an interview on Our Hidden History that either has come out or will come out soon depending on when this article is released. Before the scandal had broken the Christic institute had filed a civil suit against North and the Iran contra conspirators. After the scandal broke there followed the Tower Commission, the Joint House and Senate Iran Contra hearings and a 6 year long investigation by the Office of the independent council. Nearly a dozen people were convicted or signed plea deals. Bush pardoned them all. The one exception was Thomas Clines who was jailed for income tax invasion for failing to report his income from the enterprise. Democracy and rule of law versus the national security state it’s sort of like Bambi vs Godzilla (a cartoon from the time) the outcome was never in doubt. There is the way things are “supposed” to work and the way they really work. On the international stage the aftermath of Iran-Contra lead directly to the wars in Panama and Iraq. The Iraq war in various forms continues 30 years later a horrifying bloodbath that has cost millions of lives. Thanks to the efforts of the NED and a populace exhausted by contra terror and sick of the economic blockade the Sandinistas were voted out of power in 1991. Thanks to the failure of America’s neoliberal puppets in Nicaragua the Sandinistas were voted back into power and the US is once again intent on overthrowing the Nicaraguan government. There has never been any serious official investigation into the CIA supplying arms cash and advisers to al Qaeda style terrorists through third country proxies like Saudi Arabia. Thanks to the stranglehold of the Israel lobby on US foreign policy the US has yet to establish friendly relations with Iran. Yet Iran has grown too powerful for the US to invade and occupy. Hezbollah eventually decided to adopt the tactics of guerrilla warfare targeting military targets and avoiding civilian targets. They have defeated Israel twice forcing it to withdraw from Lebanon then halting a more recent Israeli invasion earning Hezbollah respect and admiration around the world. In the west Reagan’s legacy continues to dominate the ruling class, capitalism and imperialism continue to run rampant and fascism seems always to be just around the corner.


 Malcolm Byrne’s Iran-Contra: Reagan’s Scandal and the Unchecked Abuse of Presidential Power is the definitive mainstream version of events. Byrne has been researching Iran-Contra for nearly 30 years.

Lost History: Contras, Cocaine, The Press & Project Truth by Robert Parry gives many details left out of mainstream accounts. He has an in depth discussion of the Contra drug connection as well as the role of drugs in Panama and Honduras. He also discusses the Reagan Administration Public Diplomacy campaign that destroyed investigative journalism in the US.

Robert Parry’s Secrecy & Privilege: Rise of the Bush Dynasty from Watergate to Iraq is another must read. It has a long section covering the “October Surprise” including the mass of evidence he discovered after writing “Trick or Treason: The October Surprise Mystery. It also contains lots of interesting dirt on George H. W. Bush and his son George W. Bush. 

Theodore Draper wrote the earlier definitive mainstream account back in the 1990’s ‘A Very Thin Line: The Iran Contra Affairs” It is longer and more detailed then Byrne’s although the author has a sinister past (former communist turned anti-communist scholar for various CIA funded fronts) that makes him all too willing to trust the CIA and fail to dig deeply into the scandal. He never mentions drugs. Still it’s worth reading for anyone interested in the Iran side of Iran Contra.

Firewall: The Iran Contra Conspiracy and Cover-Up by Lawrence E. Walsh the Independent Counsel in The Iran-Contra Investigation offers a long account of his offices investigation and prosecution of Oliver North and other Iran Contra Conspirators. It’s fun to see the case slowly unravel and Walsh’s investigation revealed a great deal that Congress failed to uncover and he gradually begins to have more evidence about the role of then President George H. W. Bush and former President Ronald Reagan in the scandal.

Guts and Glory: The Rise and Fall of Oliver North by Ben Bradlee jr. is a detailed and entertaining account of the life of Oliver North and the Iran Contra scandal although it came out to early to contain some of the later evidence uncovered. 

The Iran Contra Scandal the Declassified History Edited by Peter Kornbluh and Malcolm Byrne provides a valuable resource for studying the Iran Contra Scandal it contains compact summaries of events as introductions to reprints of declassified documents released during the Congressional and Walsh investigations, plus a timeline of events and a list of key players.

A good book on the war  in Lebanon is Beware of Small States: Lebanon, Battleground of the Middle East by David Hirst it covers the complex history of Lebanon from the 1940’s to the 2006 war.

The section on Bush and North’s counter-terrorism network is based on Peter Dale Scott’s article “Bush and North: The Task Force on Combatting Terrorism” in Covert Action Information Bulletin issue 33 Their classic special issue on Bush and the CIA which is packed full of Iran Contra information and dirt on Bush. Also check out Peter Dale Scott’s Deep State for an in depth account of continuity of government planning.

Subscribe here to gain access to Covert Action’s archive

Secret Warriors: Inside the Covert Military Operations of the Reagan Era by Steve Emerson contains interesting information on the Special Operations role during the Iran-Contra era as well as Emerson’s own take on Iran-Contra. He was given access because he was aligned with the goals of the national security state. He also had close ties to Israel’s Likud party and played a major role in covering up the October Surprise. Emerson later become an insane neo-con war on terror hysteric.

Casey: From the OSS to the CIA by Joseph Persico contains some interesting information but is generally a complete disappointment. Persico is too naive and inexperienced to write about the CIA has no idea how they operate and no idea what to look into. It completely fails to provide a complete picture of the CIA in the 1980’s and the author is way to sympathetic to Bill Casey. That’s why Casey befriended Persico and then his widow granted him access to Casey’s papers.

Dangerous Liaison: The Inside Story of the US-Israeli Covert Relationship by Andrew and Leslie Cockburn is full of shocking details about the Israeli role around the world including their drug smuggling in Panama, Colombia, and Central America. It also provides many insights into the Israeli view of Iran Contra.

Malcolm Byrne lecture about his Iran Contra Book

A Robert Parry Interview

Robert Parry’s Frontline documentary on October Surprise

A discussion of the October Surprise

The 1st part of Dave Emory’s 4 part series on the “Deep October” surprise with Iranian researcher Fara Mansoor who argues that the whole hostage crisis and the rise of Khomeini were engineered by a faction of the CIA loyal to Bush with help from Thatcher and MI6.

Deep October Surprise Part 2

Deep October Surprise Part 3

Deep October Surprise Part 4

Documentary Cover-Up Behind the Iran Contra Affair

An Archival radio interview on Iraqgate the flip side of the Iran arms sales the much larger sales of arms by the US to Iraq. The Bush administration massively expanded arms sales to Iraq right until the moment Iraq invaded Kuwait and America launched it’s 30 year long series of wars on Iraq.

My earlier series on Iran Contra

Part 1 The Secret Team

Part 2 World War 3

Part 3 The World Anti-Communist League Part 1

Part 4 The World Anti-Communist League Part 2

Ted Shackley a Life in the CIA

Old Nazis, New Right (Also covers the Coors Connection)

Subscribe to the Our Hidden History Youtube channel for dozens of Iran/Contra and CIA/Drugs related videos like my interview on Oliver North




Thursday, January 20, 2022

Iran-Contra Pt 2: Illegal Contra War

 The Iran Contra Scandal: The Illegal Contra Resupply Operation

With Special Thanks to Dr. T. P. Wilkinson

    The Iran/Contra scandal is so complex that I’ve decided to separate the Nicaragua and Iran parts into separate articles. Many of the cast of characters introduced in this article will reappear in the next. Names like National Security Advisers Robert McFarlane and John Poindexter, Oliver North, Richard Secord, Albert Hakim, Thomas Clines, and Duane “Dewey” Clarridge. Israel would play an important role in both Central America and the Middle East. And of course President Ronald Reagan, Vice President George Bush and CIA director William Casey would play major roles in both scandals. The CIA and National Security Council having  assembled “the Enterprise” to wage an illegal war on Nicaragua in 1984-1986 employing private contractors who were ex-military or CIA Secord, Clines, Hakim. The NSC would employ the same enterprise to handle logistics in the Iran arms deals starting in the fall of 1985. This is the mainstream version. On the other hand the true origins of the “Enterprise” went back to much earlier middle east arms deals. Secord had served in Iran back in the early 1960’s and returned in the late 1970’s supervising the Pentagon’s Military Assistance Program to the Shah’s Iran. Secord was also suspected of being a partner in EATSCO with Thomas Clines, Ted Shackley and Ed Wilson. By beginning the story in Nicaragua I am not implying that this is the true origins of the affair. However since this article is on the mainstream version of the Iran-Contra affair I will not attempt to trace the history of the Iran Contra players through the decades prior the scandals exposure in 1986 as the Christic Institute attempted to do in their civil case against “The Secret Team” which inspired my earlier series on the Iran/Contra scandal and my biography of Ted Shackley. I will merely comment that Secord and Clines had both been deeply involved in running covert operations with drug smuggling allies in places like Laos and Vietnam.

   I plan to do a whole series on the Contra drug connection next year so I will not deal with that aspect of the scandal in depth here. All the contra leaders of every faction were deeply involved in drug smuggling. More all of the US right wing military dictatorships like Guatemala, El Salvador, Argentina, and Chile as well as nominally democratic but brutally repressive countries like Colombia, Mexico and Honduras were all involved in drug smuggling. All received tacit permission and CIA protection for this massive drug trade. It is a pattern that has continued long after the cold war nor is it restricted to Latin America. South East Asia, Central Asia, the Middle East, Australia, Europe, and increasingly Africa all have their stories of CIA protected drug trades and the CIA is not unique intelligence agencies around the world are involved in the global drug trade. It’s all so obvious that it would be widely known if not for the cowardice of most academics and journalists or more accurately their role in propagandizing the public on behalf of the empire. The war on drugs like the war on terror is a complete farce but few dare to point out this fact.

   The United States invaded and occupied Nicaragua from 1912-1933 training a brutal national guard to keep order when they left. Anastasio Somoza was the head of this force and always eager to please his American sponsors. He seized power in 1936 and his family would rule till it was overthrown by the Sandinistas July 17 1979. This was during the Jimmy Carter presidency. Carter’s record in Central America was rather more sinister then the myth of his supposed obsession with human rights would suggest. He authorized a massive escalation in military aid to El Salvador in his final years in office for example. Carter had cut off military aid to Somoza however because his refusal to negotiate and brutal war crimes endangered the US’s ability to manage the transition of power. Carter hoped to use the promise of aid to keep the Sandinistas in line. Their were doubtless secret plans to undermine them at the same time there is always a “Track 2.” Little aid was delivered but Carter’s policies were viewed as treacherous and weak by future President Ronald Reagan. 

   In the fantasy world of Reagan and the National Security State what had happened in Nicaragua was not a popular revolution but a sinister soviet plot to dominate the western hemisphere. Destroying Nicaragua and preventing revolutions in El Salvador and Guatemala would become major priorities of the new administration. Reagan’s election in 1980 amounted to a soft coup as I discussed in my introductory article involving illegal campaign contributions from rich oligarchs in El Salvador and Guatemala who were given the green light to commit atrocities and mass murder. These schemes involved Michael Deaver future Contra supplier Major General John K. Singlaub and Reagan’s  first National Security Adviser Richard Allen. The Reagan campaign also sent emissaries to the Contras. Most importantly the Reagan campaign made a deal with Khoemeini’s faction to prevent the release of the American hostages in Iran the so called “October surprise” which personally involved George. H.W. Bush, Bill Casey, Richard Allen and future National Security Adviser Robert McFarlane among other key players in the Iran Contra scandal. I’ll expand on this in the Iran Section.

   When Reagan came to power in 1981 he began plans to wage his war on Nicaragua. In the fall of 1981 the Contras were a tiny force of 250 men mostly veterans of Somoza’s National Guard in exile in Guatemala under the protection of the “Godfather of the death squads” Mario Sandoval Alarcon. Others Contras were in exile in Honduras. Honduras would be the Contras main future base backed by the Honduran military, Argentine advisers fresh from their dirty war in Argentina and the Bolivian Cocaine coup, and Cuban bay of pigs Veterans. The future contras were also living in Miami where they had formed an alliance with the Cuban exiles. They engaged in terror attacks, drug dealing bank robbery and kidnapping to finance their counter-revolution some survived by armed robbery and stealing livestock. They had named themselves the 15th of September Legion. This was the situation in fall of 1981 when the Reagan administration began it’s war on Nicaragua.

  In August of 1981 Duane “Dewey” Clarridge the new head of the CIA’s Latin America division was sent down to Honduras to meet with the Honduran military who were working with the Contras and their Argentine Advisers. Clarridge was a veteran of Operation Gladio in both Turkey and Italy. DCI Casey had picked him despite the fact that he didn’t speak Spanish, because he was a reckless “cowboy” used to operating above the law doing whatever dirty work was necessary.  Clarridge operated under the alias Maroni while the contras jokingly called him “GarCIA”. Clarridge would run the Contra war until mid 1984 when his harbor mining and assassination scandals would alienate congress and eventually get them to forbid further aid to the Contras. Instead of being fired Casey would promote him to the even more prestigious position of head of the European division.

   In November of 1981 Reagan signed NSDD 17 authorizing a full scale covert war on Nicaragua. On December 1 1981 Reagan would sign a Presidential Finding on Nicaragua meant to deceive congress on the full scope of what he was up to. In the wake of the CIA scandals of the 1970’s and the congressional investigations a system of oversight was put into place, House and Senate Intelligence committee’s were set up and in order to conduct a covert operation a president had to sign a Presidential finding and inform congress within 30 days. Reagan and Bill Casey planned a massive expansion of the CIA and in order to get congress to agree they had included oversight and the need for presidential findings in the bill. This would be an important legal detail later in the scandal. Casey despised the idea of congressional oversight keeping congress in the dark as much as possible. Casey even wanted to exempt the CIA from FOIA requests lying to congress he claimed that every day a CIA officer resigned over fear their name might be revealed in a FOIA request. Reagan would conduct covert operations without signing the proper findings which could have gotten him impeached. In this case Reagan’s finding on Nicaragua was a deceptive cover story. Knowing that Congress wouldn’t approve their plan to overthrow the Nicaraguan Government Reagan and Casey created the cover story that they merely wanted to create a 500 man force to interdict arms going from Nicaragua to the El Salvadoran guerrillas. Congress was kept in the dark about the fact that they were already working to overthrow the Nicaraguan Government.

   Bill Casey was a key architect of the Iran-Contra affair and the mastermind of the Reagan doctrine that America must wage covert war on any socialist or independent minded country or as they put it “aid freedom fighters around the world.” Casey’s father worked in the sanitation department but was extremely well connected to the Irish political machine in New York. Casey became a lawyer and an expert on corporate law and tax evasion publishing guides for corporations on tax loopholes. He joined the OSS during the war running intelligence in the European theater. He loved his job but decided to leave the government and make his fortune. Actually Casey was part of a network of old ex-OSS men who ran CIA front NGO’s like in Casey’s case the International Rescue Committee and the Crusade for Freedom covers for their work with fascist emigres. Another group of ex-OSS men ran the media and Casey would later acquire huge media holdings. Thanks to Casey’s connections and his skills at tax evasion including the creation of the concept of the tax shelter he got rich. He remained active in politics and was rewarded for his support for Nixon with the position of head of the SEC, The Export Import  Bank, and the State Department’s economic division. He turned down the job Deputy Director of Operations for the CIA offended they hadn’t offered him the director spot. 

   Finally Reagan was convinced to hire Casey as his campaign manager and he ran the campaign like a covert op stealing Carter’s debate book among other dirty tricks. He wanted to be rewarded with the position of Secretary of State or Defense but was rejected because he was a notorious slob and a mumbler. Instead he became CIA director which was elevated to a cabinet post. He would oversee a massive expansion of the CIA and would also push for a massive expansion of the military’s special forces. He was impatient with the CIA’s bureaucracy and despised the analytical division for throwing cold water on the anti-soviet hysteria the Reagan administration was drumming  up. He purged the whole division replacing them with analysts who would toe the party line. Yet he fully realized how vulnerable the Soviet Union was and helped engineer it’s downfall. To get around CIA red tape Casey like to rely on private businessmen and other cut outs. To be closer to the President Casey had opened office in the Executive Office Building close to Oliver North’s. North met with Casey regularly and Casey was a major influence over National Security Adviser Robert McFarlane. North would report to both Casey and McFarlane on his Iran Contra project. Just as the Iran/Contra scandal was breaking Casey’s brain cancer incapacitated him and he was sent to a CIA approved hospital for radical brain surgery which left him conveniently unable to communicate. He died a few months later.

   The war on Nicaragua would escalate in a major way spring 1982. Now renamed the FDN and having the full support of the CIA the contras launched 106 attacks between March 14 1982 and June 21 1982. They blew up the bridges connecting Honduras and Nicaragua, assassinated minor government officials and began sniper attacks on Nicaraguan troop convoys. Also in 1982 the CIA would recruit Eden Pastora who played a heroic role during the revolution but turned traitor. He would relocate to Costa Rica where his much smaller force ARDE would attempt to open up a southern front. Late in 1982 the CIA would recruit 8 civilians with anti-Somoza reputations to serve as the FDN’s civilian directorate in an attempt to defuse criticism that the FDN were made up of entirely of Somoza’s National Guard who had committed horrific war crimes under Somoza and were carrying out equally horrific crimes against Nicaragua with CIA backing. 

    This was only a small part of the psychological warfare strategy the Reagan administration was waging on the US public and the world at large. In 1982 Casey would transfer veteran CIA propagandist Walter Raymond Jr. to the NSC to run the Intelligence division and begin launch a Public Diplomacy campaign. Public Diplomacy (like the term public relations) was the latest euphemism for propaganda and psychological operations. Raymond led the campaign to ensure that Reagan’s delusional analysis of events in Central America would become the prevailing wisdom. Raymond and his lackey Otto Reich who would be in charge of the State Departments office of Public Diplomacy for Latin American affairs or S/LPD would wage war on investigative journalists. The press was used to “Following the State Department line.” Now if they failed to follow that script by exposing war crimes in Central America, Otto Reich might personally arrive to bully their editors or producers. Oliver North worked closely with Raymond and Reich attending over 70 meetings of the S/LPD. Many journalists were fired as a result. They also spread wild rumors about journalists critical of administration policy accusing female journalists of having Sandinista lovers and male journalists of being supplied by the Sandinistas with prostitutes of either sex. North went further telling the FBI Robert Parry had poisoned his dog which had died of old age. They also set up a network of journalists who were actually secretly on the state  payroll to print opinion pieces in the New York Times or the Wall Street Journal. Later they would also illegally fund the “Contra Lobby” Carl “Spitz” Channell, Richard Miller, and Frank Gomez who were also working closely with Oliver North raising money to buy arms for the Contras and illegally lobby Congress.  Raymond’s main goal was “to paint black hats on the Sandinistas and white hats on the Contras” in the process he managed to effectively kill investigative journalism by the end of the 1980’s according to Robert Parry one of his victims. Raymond called it “Project Truth.”

   Perhaps it is time to fully introduce Oliver North who's power was steadily growing over at the NSC while “Dewey” Dewey Clarridge was running the Contra war. In 8th grade he had been sent away for a year of military school despite being a very well behaved kid. Later after attending a marine training camp in High School he became obsessed with joining the marines, attended the Naval Academy, became an officer in the marines and happily went to Vietnam his one worry was that the war  would end before he could get there. North was a true believer never questioning the genocidal war in Vietnam. He lead a platoon in Vietnam.  After serving his tour returned to testify on behalf of a friend who had helped massacre a village in an incident the press dubbed “The Marine Corps’s My Lai”. While waiting to testify North joined a black ops marine intelligence unit on night time missions assassinating the Vietnamese on what was basically his  vacation. North got his first taste of fame when he and several marines signed a letter claiming that in all their time in Vietnam they had never witnessed a single war crime or human rights violation by either American or South Vietnamese forces. This was an absolutely absurd lie but it got him invited onto ex-CIA media pundit William F. Buckley’s talk show. (Not to be confused with the CIA station chief William Buckley kidnapped in Beirut) North began training marines in Counter-Insurgency both in the States and in Okinawa. When his wife threatened to leave him he had a nervous breakdown in 1974  and threatened to commit  suicide muttering “I’m no good” and waving a pistol around. He was hospitalized and recovered his wife didn’t leave him. The whole incident was covered up later allowing him to be picked for the NSC. In 1975 he was assigned to marine headquarters in the manpower division where he befriended the top brass. He was promoted to major and assigned to Camp Lejeune. In 1978 after a superior officer gave him a faith healing of his leg North became an enthusiastic born again Christian raised catholic he now joined a charismatic Episcopalian church. This would prove useful in the Reagan era as North would also work closely with the Christian Right to drum up support for the Contras and joining the influential Council on National Policy (CNP.) In 1980 he was sent to the Naval War College. 


    In1981 National Security Adviser Richard Allen picked North to join the NSC. Allen would be replaced by National Security Adviser William Clark an old Reagan crony from his days as Governor of California and the NSC suddenly had a lot more access to Reagan. Clark would be replaced by his deputy Robert McFarlane who had been an aide to Kissinger during his secret trips to China. McFarlane hoped to emulate his mentor Kissinger raising the power of the National Security Adviser. Like North McFarlane was a marine and they soon formed a close father and son type relationship fueling North’s meteoric rise. One of North’s first assignment was to lobby for the AWACS sale to Saudi Arabia when he met Richard Secord who was also deeply involved with the AWACS sale over at the Pentagon. 

   North was assigned to work on Continuity of Government planning where he worked on contingency plans to suspend the constitution declare martial law and round up tens of thousands of anti war activists and hundreds of thousands of Central American refugees in the event of civil unrest in response to the invasion of Nicaragua. Reagan had dreamed of instituting martial law back when he was Governor of California waging war on Anti-war protestors, Black and Latino radicals and others. Luis Giuffrida as head of California Specialized Training Institute was a key mastermind of this plan called Cable Splicer. As president Reagan appointed Luis Giuffrida to run FEMA. In the Reagan era continuity of Government plans would expand from post-nuclear war scenarios to terror attacks or even civil unrest.  In 1984 Oliver North would use the Rex-84 exercise as part of a scheme to funnel “surplus” weapons to the Contras. The 1980’s Continuity of Government plans would form the blueprint for the government response to 9/11. “Paranoia” over FEMA camps would continue for decades on the far right. Ironically back in the 1980’s the plan was to recruit the militia movement to serve as State Defense Forces who would conduct these round ups of Central American refugees and for decades right wing militias have been allowed to terrorize refugees at the borders.

   North also began to take an increasing interest in Central America serving under Roger Fontaine on the NSC eventually replacing him as the NSC point man in charge of Central America. North would serve on the Kissinger Commission which drew up a blueprint for continuing Reagan’s dirty war in Central America. Soon North was serving as the NSC representative on the RIG the Restricted Interagency Group on Central America  where he worked closely with Dewey Clarridge the CIA representative. Eventually the RIG composed of Oliver North of the NSC, CIA Central America Task Force chief Alan Fiers,  and Assistant Secretary of State for Inter-American Affairs  Elliot Abrams would run Central American policy also supervising Walter Raymond’s Public Diplomacy campaign as the RIG triumvirate or RIGlet.

  Having introduced North let’s return to “Dewey” Clarridge’s Contra war back in late 1982. In December 1982 in response to the massive expansion of the Contras, their aggressive attacks, reports of massacres, the expansion of the war to Costa Rica (which since it was to Nicaragua’s south could not play any role in the cover story of interdicting arms heading for El Salvador) Boland I was passed it forbade the Reagan administration from using the Contras to overthrow the Nicaraguan Government. Reagan signed it and DCI Casey merely ignored it since he could deny that his goal was to overthrow the Nicaraguan Government up until he actually succeeded in doing so. Instead his worry was that the war was behind schedule. In 1983 there was yet another escalation in the Contra war. In 1983 Dewey Clarridge commissioned the Contra handbook “Psychological Operations in Guerrilla Warfare.” which the press would later dub the “assassination manual” or “the murder manual” it argued for selective terror against loyal Nicaraguans and assassinating contras to create martyrs. Ignoring Boland I it called for the overthrow of the Nicaraguan Government. It would cause a scandal when exposed by journalist Robert Parry. In May of 1983 Reagan for the first time openly praised the Contras as freedom fighters and bragged that the US was funding them. He would later claim “I am a Contra.” and compare them to the US founding fathers. He was serving as the mouthpiece for the public  diplomacy campaign which advised claiming that the contras were freedom fighters fighting for democracy when they might more accurately described judging them by their tactics and origins as bloodthirsty death squads and terrorists pining for the days when Nicaragua was run by a fascist dictator. The Contras massacred peasants, raped, tortured, and killed in the grisly manner favored by CIA trained death squads mutilating their victims with knives an machetes. The Contras blew up buildings and burned down hospitals and grain silos. They terrorized not just Nicaraguans but Hondurans, and Costa Ricans. 

   By summer 1983 it had become clear that “Dewey” Clarridge wouldn’t be able to meet his deadline to topple the Sandinistas by Christmas 1983. Cuban and Soviet economic aid were preventing the US sanctions and economic warfare from collapsing the economy. Nicaragua was successfully repelling the contra attacks. “Dewey” Clarridge came up with a plan to destroy Nicaragua’s economic infrastructure and since the Contras weren’t up to the job he would have the CIA do it themselves utilizing UCLAs or Unilaterally Controlled Latino Assets Cuban-Americans, Mexican Americans, and Puerto Ricans who were military and probably special forces veterans but who if killed could be passed off as Nicaraguans. He purchased a huge mothership as a base for a fleet of speedboats and starting in fall 1983 began trying to destroy Nicaragua’s oil infrastructure. On September 8 1983 the UCLAs attacked an oil pipeline and docks at Puerto Sandino. On October 10 1983 the UCLAs set fire to the oil storage facility in Corinto forcing the entire town to evacuate. In December of 1983 as a compromise between those who wanted to end all aid to Contras and those who wanted it to continue Congress voted to put a 24 million limit on aid to the Contras in Fiscal Year 1984. Undeterred Dewey Clarridge presented a plan to Casey to mine Nicaraguan harbors an act of open warfare under international law. Casey and Reagan gave Dewey Clarridge the green light. “Dewey” Clarridge convinced the Contra leadership to take responsibility although in reality it was the CIA’s UCLAs who carried out the mining. The mining began on January 1st and lasted till April 24 1984. Casey claimed he had properly informed Congress but since he was a mumbler and it was buried in the middle of his testimony no one had noticed. While Casey had mentioned the mining he had lied and said the Contras had carried out the mining. In any case when the press reported the mining in April of 1984 it was a major scandal. Dewey Clarridge had spent nearly all the Contras  24 million 1984 budget on the mining and other attacks and when the scandal broke Clarridge was in South Africa begging for arms and cash to fund the Contras. South Africa was willing to send arms and money since it was working closely with the US running it’s own Contra style wars against Angola and Mozambique against Nicaragua’s Cuban allies in the case of Angola. The Reagan administration decided that because of the mining scandal it should avoid further controversy by involving Apartheid South Africa of which Reagan was a strong supporter.

    Eventually the Harbor mining scandal and the assassination manual scandal would lead to the passage of Boland II in October 1984. In the meantime Reagan would order his National Security Adviser Robert McFarlane to find a way to keep the Contras together “Body and Soul” even if Congress cut them off. McFarlane picked his protege Oliver North to run the operation. It had been planned to hand the contra war over to the NSC back in 1983 when the 24 million spending cap was imposed. In February 1984 McFarlane had asked Israel to take over the Contras. The  Israelis had basically taken over for the US in Guatemala although the US was secretly still heavily involved there and McFarlane hoped they would play a similar role advising the Contras. Israel refused for fear of endangering their bipartisan stranglehold on the US congress but they would play a key role in arming the Contras.    

   Dewey Clarridge introduced North to the Contra leaders as the new point man on the Contra Operation.  Casey suggested North recruit Richard Secord to run the Contra resupply operation. North sent Secord down to meet with the Contra’s and obtain “a shopping list” of weapons and supplies they needed. Secord would be in charge of weapons procurement charging a 38% markup to the Contras. His partner Iranian exile Albert Hakim began setting up a network of shell companies like Energy Resources International, Lake Resources, Udall corp, and Amalgamated Commercial Enterprises in addition to the shell companies and fronts they’d already set up as part of their business like Stanford Technology Group. They called it the Enterprise while North called it “Project Democracy” the dark underbelly of the newly created National Endowment for Democracy.   Standard operating procedure in shadowy world of military contractors, arms dealers, offshore bankers, private intelligence firms, transport specialists, and crisis management populated by ex-spies, ex-military operating under the unofficial protection of the US and other governments. Soon Secord hired his old EATSCO partner Thomas Clines to handle the arms deal when his first deal involving Canada’s Transworld Arms and China faced delays over the fake Guatemalan end user certificates which made China hesitant because Guatemala was a close ally of Taiwan. Clines source was Defex of Portugal whose board had close ties to Clines. Clines would bring in CIA Cuban and assassin Rafael “Chi Chi” Quintero to run things on the ground in El Salvador. 

  Another key member of the Enterprise was Rob Owen supposedly a civilian. Owen’s brother was in the State Department (or possibly CIA) and was killed in Vietnam. Owen went to work for the International Rescue Committee a CIA front in Vietnam then joined future Vice President Dan Quayles staff. CIA rancher John Hull paid him a visit and Owen became obsessed with helping the Contras. He went to work for CIA tied Gray & Co a PR firm owned by Robert Keith Gray who had long worked with the CIA in looting Latin America. The Contras tried to hire Gray & Co to do their PR but the deal was vetoed by a former Kennedy aid. Owen quit and went to work for the FDN and soon became North’s courier to the Contras. Owen worshipped North who he called “The Hammer” and “Old Blood and Guts.” Owen ran his own one man pro-contra NGO IDEA.

   In addition to setting up a privatized network to cope with reduced CIA involvement it was necessary to find a new source of funds. National Security Adviser Robert McFarlane turned to the Saudis meeting with Ambassador Bandar Bin Sultan (aka “Bandar Bush”) in May of 1984. Ambassador Bandar Bin Sultan agreed to supply 1 million a month to the Contras with the permission of King Fahd. In February 1985 the Saudi’s would double their donation after President Reagan met with King Fahd.  The Saudi’s gave a total of 32 million. WACL head retired General John Singlaub and Oliver North eventually convinced Taiwan to donate 2.7 million. “Dewey” Clarridge had gotten the South Africans to provide arms money and advisers but the deal was canceled or delayed do to the harbor mining scandal. South Africa did supply millions to the network of cold war lobbyists and new right propagandists the Reagan Administration relied on to sell their policies to the public and pressure or unseat congressional opponents critical  of the Contras and other Reagan policies. In 1986 prior to the scandal breaking Elliot Abrams convinced the Sultan of Brunei to give 10 million to the Contras but due to a supposed clerical error by Fawn Hall North’s secretary the money ended up instead in the Swiss bank account of Israeli expat Bruce Rappaport a shadowy figure (ie connected to organized crime, big business, intelligence and the Israeli labor party) who was a key element in the Iraqgate schemes to build a Bechtel oil pipeline in Iraq. Rappaport had promised to pay tens of millions to Israeli politicians for the promise not to blow up the Iraqi pipeline. Abrams blanket denials to congress when questioned on whether the State Department was soliciting 3rd country donors saying “We are not in the fundraising business” would almost land him in prison. The Reagan Administration would solicit aid from over two dozen countries on behalf of the Contras.

   It was also vital to keep Central American countries supportive of the Contras a policy that was as unpopular in their countries as it was in the US. Their support was maintained via illegal quid pro quo deals. The Reagan administration could only ask for aid to the Contras if there were no strings attached, if congress was informed and if there was a presidential finding. President Reagan and Vice President Bush would personally violate the law intervening with heads of state in Central  America offering quid pro quos and threatening aid cut offs. If the countries agreed to support the Contras they would get huge increases in military and economic aid. If they tried to interfere with the Contras they were threatened with aid cut offs. In El Salvador and Guatemala these arms shipments would be used in their US backed dirty wars on peasants and workers that would claim 300,000 lives. Mexico was home to Contra training camps under the protection of the infamous Guadalajara cartel that were considered so sensitive that DEA agent Enrique “Kiki” Camarena Salazar and Mexico’s top investigative journalist Manuel Buendia were both murdered to cover it up. Buendia was assassinated by Mexico’s CIA trained DFS. Bush’s man Felix Rodriguez was there to interrogate “Kiki” Camarena as the cartel tortured him to death.  


   Guatemala was used to supply fake end user certificates for the Enterprise’s Contra arms deals. El Salvador’s Ilopongo airbase would be the supply depot for the Contras as Honduras didn’t want direct supply flights from the US. Bush’s National Security Adviser Donald Gregg had sent Felix Rodriguez to El Salvador as an adviser on using helicopter strike teams in their dirty war in the countryside as well as to run the Contra resupply at Ilopongo. Rodriguez had run a similar program under Gregg in Vietnam when they were in the CIA. Rodriguez had formed a tight bond with the El Salvadoran Air Force General Juan Rafael Bustillo. Before leaving for El Salvador Rodriguez met with Bush and then SouthCom Commander in chief Paul Gorman who flew Rodriguez down to Ilopongo. Eventually Rodriguez would clash with the Enterprise. 

   Honduras was the Contras main base and the US was constantly forced to intervene whenever Honduras would threaten to withdraw support or jealously seize Contra weapon shipments of surface to air missiles that the US supplied to the Contras but not Honduras. Vice President Bush personally flew to Honduras as Reagan’s special envoy to offer Honduras a quid pro quo to Honduran President Suazo. Amusingly at an earlier National Security Planning Group meeting Bush had warned the cabinet that such quid pro quos were illegal. The Honduran military who worked closely with the Contras were also involved in a massive drug smuggling operation. Honduran General Jose Bueso-Rosa was busted in Florida and $40 million dollars in cocaine was seized by the FBI.  General Buso Rosa  was planning to use this drug deal finance the assassination of Honduras’ new President. Oliver North and Elliot Abrams lobbied on his behalf to get the charges dropped and when that failed to get him a lighter sentence in a minimum security prison. They were worried General Bueso-Rosa might expose the illegal contra resupply operation. 

    Panama was a key Contra supporter General Noriega’s main adviser was Michael “Mad Mike” Harari a notorious Mossad veteran who was making a fortune supplying Panama’s air force with US parts and using that as a cover to smuggle cocaine to the US. A longtime CIA asset Noriega donated tens of millions to the Contras along with his bussiness partner Harari in exchange for the US’s ignoring his involvement in drug smuggling and money laundering. Panama would supply an explosives expert to ex-SAS British Mercenary David Walker for an attack that blew up an arms depot in downtown Nicaragua that sparked a fire destroying a nearby military hospital. Just prior to the Iran/Contra scandal breaking Oliver North met personally with Noriega on a plan to pay Panama one  million dollars and fix Noriega’s PR problems in exchange for Noriega’s help launching terror attacks on Nicaragua. Noriega offered to loan the US teams to carry out assassinations. The plan also called for setting up a Contra training base in Panama where Panamanian and Israeli advisers would create a western front in the Contra war targeting the capital Managua. Noriega was having PR problems because Sy Hersh had exposed Noriega’s drug empire in the New York times a couple months before. Casey and Bush had also held personal meetings with Noriega.

   Costa Rica was host to a much smaller Contra force then Honduras but was even more resistant to supporting the Contras. It was home to secret airstrips to supply the Contras the most infamous being John Hull’s Ranch where drugs were smuggled, mercenaries housed, and the La Penca bombing was allegedly planned. The La Penca bombing took place May 30 1984. Pastora had refused to merge his forces with the FDN ignoring a CIA ultimatum. 8 people were killed including 3 journalists one of them an  American Linda Frazier. 17 were injured including Tony Avirgan. Avirgan and his wife Martha Honey would investigate the bombing and the trail lead to John Hull’s Ranch and meeting attended by North’s courier Rob Owen and CIA station chief Joe Fernandez. Hull had been plotting Pastora’s assassination for months who he viewed as a “Commie.” Mercenaries who frequented Hulls ranch claimed that there was also a plot to kill Ambassador Lewis Tambs and blame Nicaragua as a pretext for a US invasion. It would also allow the Contras to collect a million dollar bounty the Medellin Cartel had put on Tambs. Avirgan and Honey sought the aid of the Christic Institute when Hull sued them for Libel and tried to frame them as drug traffickers. Eventually they became the plaintiffs in the Christic Institute civil lawsuit of the Iran Contra conspirators. 

   Costa Rica was also home to the Santa Elena airstrip which North had the Enterprise purchase through the dummy corporation the Udall Research Corporation set up by North’s friend ex-marine William Haskell under the fake name Robert Olmstead. North’s alias throughout the Iran Contra affair was “William Goode” Secord’s was Richard Copp. Copp Goode and Olmstead were listed as the board of directors of Udall Research Corp. The Airstrip was built through the efforts of Ambassador Lewis Tambs and CIA chief of Station Joe Fernandez. The Costa Rica’s Minister for Public Security Benjamin Piza was on the CIA payroll and was the airstrips Costa Rican protector. His reward was a trip to DC for a personal photo op with Reagan. CIA chief of station Fernandez would blatantly violate the Boland amendment by serving as the Contras communications officers supervising arms drops. Charges were later dropped against Fernandez when the CIA refused to cooperate. When Oscar Arias was elected President of Costa he ordered Santa Elena shut down but his government ignored him. Eventually in 1986 his government would raid Santa Elena and expose the Udall corporation despite the panicked efforts of the Reagan Administration. Arias would later win the Nobel prize for his Arias Peace plan the blueprint for ending Central America’s bloody dirty wars.

   In addition to seeking donations and support from other governments North partnered with a domestic fundraising network raising illegal tax free donations for the Contras, funding a vast domestic propaganda campaign on behalf of Reagan’s Central American dirty wars and engaged in illegal meddling with congressional elections. Carl “Spitz” Channell was the key fundraiser setting up a network of NGO’s like the NEPL (The National Endowment for the Preservation of Liberty) and ACT (The American Conservative Trust. His network was closely tied with that of Richard Miller and Frank Gomez who ran IBC (International Business Communications) and other shell companies funded by NEPL and the US State departments S/LPD (Latin American Public Diplomacy.) North would be his unofficial partner North would give a sales pitch in the form of an intelligence briefing often at his NSC offices. North was a great salesman he could reduce donors to tears. Then after explaining what the Contras needed and what it cost he would exit the room and Channell would ask for a donation. The biggest funders were right wing widows like Ellen Garwood the Contras named the helicopter she bought them the Lady Ellen in her honor and she donated millions to Channell. Hollywood had this elderly widow played by Julia Roberts in Charlie Wilson’s war as she was also a key backer of the Afghan Mujahideen. 

   The second biggest donors were infamous right wing billionaires like Nelson Bunker Hunt and Joseph Coors who had been funding a vast network of warmongering, racist, sexist and homophobic NGO’s for decades. Hunt, Coors and other men gave hundreds of thousands to the NEPL. Donors who gave over $300,000 were rewarded with a personal meeting with President Reagan. North wrote them thank you notes on NSC stationary, and sent them commemorative souvenirs, while Channell would send the lonely widows gift baskets for the holidays. The NEPL raised $3.9 million in 1985 and $7 million in 1986. The NEPL spent half the  money it raised on $5 million in consulting fees and salaries for Channell and his cronies. A quarter went to the Contras via Secord’s Lake Resources Swiss accounts $2.7  million. Another $ 2.3 million funded the “Contra Lobby” which bought attack ads in states with swing votes on Contra funding. They also funded a vast domestic propaganda campaign on behalf of the Contras. Although the public remained opposed in 1985 Congress gave in and voted for 27 million in “Humanitarian Assistance” to the Contras. In summer 1986 their lobbying campaign would convince congress to vote 100 million in lethal aid to the Contras. However there was a 3 month delay before the funds became available so the illegal resupply operation continued and was exposed on October 5 1986 when a plane carrying arms was shot down.

    The Contras relied on 3 main arms dealers, “The Arms Supermarket”, Secord’s Enterprise, and Singlaub’s GeoMiliTech. As North and Secord’s affairs became more entangled and corrupt North forced the Contras to buy solely from “The Enterprise” and even put “The Enterprise” in charge of all the Contras funds.  The Arms Supermarket had been set up with the support of Vice President Bush, and his National Security Adviser Donald Gregg who sent Felix Rodriguez to help supervise it. It was founded with 14 million in drug money (according to North) and was run by Ronald Martin, James McCoy Mario Dellamico another Cuban exile. It ran a massive warehouse with millions of dollars in weapons  It was closely allied to the Honduran Military via Col. Hector Aplicano and the Israelis. The Arms Supermarket was implicated in the death of money launderer and cuban exile John F. Molina who was killed by a Colombian hit team in Panama.

   GeoMiliTech (GMT) was owned by Barbara Studley a former beauty queen turned talk show host. GeoMiliTech was a strange company it partnered with both China and Israel to supply Chinese and east bloc weapons to “Contras” waging covert wars around the world in Afghanistan, Ethiopia, Cambodia and of course Nicaragua.  They also bought East Bloc arms from Austrian arms dealer Werner Glatt who supplied the CIA with East Bloc Weapons. GMT became an exclusive   dealer of certain Israeli weapons system and had offices in Israel. GMT supplied 5.3 million in weapons to the Contras. Behind Barbara Studley were General John K. Singlaub and General Daniel Graham the former head of the DIA. Singlaub had been forced to retire as head of US and Korean forces in South Korea  after publicly criticizing President Carter’s troop reductions in South Korea. He had served in the OSS in China and Europe, the CIA and the military in Korea and had headed the Special Operations Group in Vietnam (SOG-MACV.) He had started the new US WACL branch the USCWF the US Council on World Freedom and would be elected to head WACL worldwide The World Communist League was an umbrella group combining fascist emigres and former nazis, right wing politicians, drug dealing asian dictators, and Latin American death squad heads like Mario Sandoval Alrarcon and Roberto D’Aubuisson. In the 1980’s WACL was a vehicle for implementing the Reagan doctrine of global “low intensity warfare” generating solidarity among fascists worldwide and support for World War 3 as they called the “cold war”. The Ukrainains had actually long argued for the need to start a nuclear war to “liberate” eastern europe. WACL was used as a diversion from North’s enterprise funneling private donations to the Contras. Singlaub sent millions in non-lethal aid to the Contras on behalf of WACL. Singlaub was very tight with Taiwan and South Korea who funded the US chapter of WACL and who he would approach to solicit donations with North and McFarlane’s permission. When the Hasenfus flight was shot down exposing the illegal contra resupply operation Elliot Abrams tried to blame the whole thing on Singlaub who angrily denied it. GeoMiliTech would later go bankrupt in the 1990’s as a result of embezzlement and fraud.

   The Enterprise purchased it’s weapons from DEFEX in Portugal arms bought with fake Guatemalan end user certificates. Around June 28 1985 North called a meeting of Contra leaders in Miami including Adolfo Calero and Richard Secord. North set the stage by tearing into Adolfo Calero about corruption and incompetence in Contra ranks. Then he announced that from then on the Enterprise would be in charge of the Contras funds. He also announced The Enterprise would set up a system to airdrop arms to Contras in the field. Secord recruited Richard Gadd to run the Enterprise’s private air force later replacing him with the more competent Robert Dutton. All 3 had been involved in planning Carter’s failed hostage rescue back in 1980 that ended in disaster. Gadd set up a shell company to rent planes from “former” CIA airline SAT Southern Air Transport which had a long history of drug trafficking. It took a while to get going and many of the air drops had to be canceled because the Contras failed to signal or the pilots couldn’t find the drop zone but eventually weapons were being dropped airdropped or unloaded in Honduras, Costa Rica, and within Nicaragua itself. Soon the Contras had more arms then they could carry. It was all based in Ilopongo military airbase. The CIA owned one hangar while North’s Enterprise controlled the other. Felix Rodriguez, and Colonel James Steele the head of US advisers in El Salvador (who would later set up death squads in Iraq) worked with the Salvadorans and the Enterprise pilots. Also there was Cuban exile terrorist Luis Posada Carriles who blew up a Cubana airliner in 1976 killing 73 people. Another CIA Cuban in Ilopongo was Rafael “Chi Chi” Quintero working for Tom Clines. Predictably Ilopongo became a major drug smuggling hub.

   In 1985 Congress had caved in and voted $27 million in “humanitarian assistance” to the Contras. The CIA and the military were barred from having anything to do with it so the State Department set up the NHAO Nicaraguan Humanitarian Assistance Office run by Robert Duemling. However unknown to Congress, Robert Duemling was forced to answer to North Fiers and Elliot Abrams of the RIG. They forced him to hire Rob Owen and soon the NHAO was hiring the enterprise as well as known drug traffickers to carry “humanitarian assistance.” NHAO flights were run out of Ilopongo and Felix Rodriguez did not bother to keep the NHAO operation separate from the enterprise. By day they were NHAO flights by night the same planes and pilots were used to fly arms.

   In late1985 North got the idea to use the proceeds of the Iran Arms sales to fund the Contras. Early in 1986 Reagan adopted North and Poindexter’s plan to cut the Israeli’s out of the Iran arms deals having the Enterprise act as the middleman. The diversion idea soon was put into place although Secord and Hakim didn’t send the Contras as much as North wanted giving them around $3.5 million instead of the $12 million North had originally envisioned in the “Diversion Memo”. They had operating costs and of course wanted to make a hefty profit. North the true believer was not above a bit of petty corruption himself when he had funneled the Saudi money to the Contras Cayman bank account controlled by Adolfo Calero, Calero had then sent North $100,000 in travelers checks North could use to cover expenses North used this slush fund however he pleased giving out travelers checks to Rob Owen and Fawn Hall and spending them on himself. North also had Secord buy him an electric gate installed by ex-CIA man Glen Robinette. Secord had also hired  Robinette to dig up dirt on Tony Avirgan and Martha Honey down in Costa Rica. Finally Secord’s partner Albert Hakim set up a 200,000 dollar trust for North’s children in the event of North’s death. 

   By fall of 1986 100 million in congressional funds were about to become available. Earlier in the year Reagan North and Abrams had come up with a “Plan B” if Contra aid failed to pass they would have had the Contras seize a strip of Nicaraguan territory defended by the Guatemalan and El Salvadoran militaries which the US would then recognize as an independent state allowing Reagan to send tens of millions in emergency aid. Abrams would later adapt this scheme for Venezuela recognizing Juan Guiado as Venezuela’s president so they could seize all the countries assets. However Walter Raymonds Public Diplomacy and the NEPL contra lobby managed to pressure congress into passing the 100 million in aid. North was relieved he had only been sleeping 3 or 4 hours a night for years he was so busy. He was starting to go a bit crazy McFarlane and his replacement John Poindexter worried. North hoped the CIA would buy the Enterprise air force for a couple million and the Enterprise would be redeployed into a new theater in the war perhaps Africa. The Reagan administration was on the verge of getting away with blatantly violating the Boland amendment. It had been exposed in the press back in 1985 and again in 1986 but the press backed off once Congress decided to accept North, McFarlane, and Poindexter’s lame denials. 

   On October 5th 1986 one of the Enterprise planes flown by Buzz Sawyer and William Cooper flew from Ilopongo, down Nicaragua's coast into Costa Rica and into southern Nicaragua. A 14 year Sandinista with a soviet surface to air missile launcher shot the plane down. Eugene Hasenfus “the kicker” was the only one wearing a parachute and managed to jump out of the crashing plane wandering the jungle before being captured the next morning and paraded around the capital and in front of international television. Felix Rodriguez had been the 1st to break the news of the missing flight calling the Vice Presidents office Donald Gregg was out so he told Gregg’s aide Sam Wilson. North was in Frankfurt meeting with the Iranian’s when he got the news. The plane had once belonged to infamous CIA drug smuggler Barry Seal. Seal had been killed February 19, 1986 by a Colombian hit squad after threatening to expose the Contra resupply operation and Vice President George H.W. Bush . After their arrest the Colombian’s said they were taking orders from a Lt. Col. they later identified as Oliver North. That story would be buried. The mainstream version was that Seal was killed by the Colombians after being exposed as a DEA informant as part of North’s scheme to frame the Sandinista’s for drug trafficking. Hasenfus testimony provoked a media firestorm by claiming he was working for the CIA and naming “Max Gomez”. The press discovered the phone records of one of the enterprise safe houses showing calls to the NSC. 

  Reagan, Secretary of State Schultz, and Elliot Abrams all went public denying any government connection to the Contra resupply operation. Abrams went on CNN and issued one of his trademark blanket denials even when asked specifically about a possible NSC connection. He told Congress he had no idea who “Max Gomez” was so did the CIA’s Deputy Director of Operations Claire George who held in his hands a briefing book identifying Max Gomez as Felix Rodriguez. Meanwhile the entire Enterprise air force was supposedly flown out of El Salvador to the US where it was buried with massive quantities of explosives blown up then set on fire. I find it a little hard to believe since usually these CIA drug planes are transferred from shell company to shell company no matter how notorious their history. Yet again many in the media and Congress choose to accept administration denials of involvement in supporting the Contras in violation of the Boland Ammendment, ignoring the mountains of evidence implicating the Reagan Administration. It was only when the Iran deal was exposed the next month and Attorney General Ed Meese exposed the “diversion” of profits to the Contras that the scandal would finally explode. Ed Meese had seized on the diversion memo to divert attention from Reagan’s involvement in the illegal Iran arms sales of 1985. Arms sales  conducted without a presidential finding and which violated the arms export control act which if exposed could potentially lead to President Reagan’s impeachment and jail time for many of the Iran-Contra conspirators. At least that’s what might have happened if American’s truly lived in a democracy rather then a national security state.

 I will deal with the Iran arms for hostage deals in part 3.





Malcolm Byrne’s Iran-Contra: Reagan’s Scandal and the Unchecked Abuse of Presidential Power is the definitive mainstream version of events.

Lost History: Contras, Cocaine, The Press & Project Truth by Robert Parry gives many details left out of mainstream accounts. He has an in depth discussion of the Contra drug connection as well as the role of drugs in Panama and Honduras. He also discusses the Reagan Administration Public Diplomacy campaign that destroyed investigative journalism in the US.

Theodore Draper wrote the earlier definitive mainstream account back in the 1990’s ‘A Very Thin Line: The Iran Contra Affairs” It is longer and more detailed then Byrne’s although the author has a sinister past (former communist turned anti-communist scholar for various CIA funded fronts) that makes him all too willing to trust the CIA and fail to dig deeply into the scandal. He never mentions drugs. Still it’s worth reading for anyone interested in the Iran side of Iran Contra.

Firewall: The Iran Contra Conspiracy and Cover-Up by Lawrence E. Walsh the Independent Counsel in The Iran-Contra Investigation offers a long account of his offices investigation and prosecution of Oliver North and other Iran Contra Conspirators. It’s fun to see the case slowly unravel and Walsh’s investigation revealed a great deal that Congress failed to uncover and he gradually begins to have more evidence about the role of then President George H. W. Bush and former President Ronald Reagan in the scandal.

Guts and Glory: The Rise and Fall of Oliver North by Ben Bradlee jr. is a detailed and entertaining account of the life of Oliver North and the Iran Contra scandal although it came out to early to contain some of the later evidence uncovered. 

The Iran Contra Scandal the Declassified History Edited by Peter Kornbluh and Malcolm Byrne provides a valuable resource for studying the Iran Contra Scandal it contains compact summaries of events as introductions to reprints of declassified documents released during the Congressional and Walsh investigations, plus a timeline of events and a list of key players.

Secret Warriors: Inside the Covert Military Operations of the Reagan Era by Steve Emerson contains interesting information on the Special Operations role during the Iran-Contra era as well as Emerson’s own take on Iran-Contra. He was given access because he was aligned with the goals of the national security state. Emerson later become an insane neo-con war on terror hysteric.

Casey: From the OSS to the CIA by Joseph Persico contains some interesting information but is generally a complete disappointment. Persico is too naive and inexperienced to write about the CIA has no idea how they operate and no idea what to look into. It completely fails to provide a complete picture of the CIA in the 1980’s and the author is way to sympathetic to Bill Casey. That’s why Casey befriended Persico and then his widow granted him access to Casey’s papers.

Dangerous Liason: The Inside Story of the US-Israeli Covert Relationship by Andrew and Leslie Cockburn is full of shocking details about the Israeli role around the world including their drug smuggling in Panama, Colombia, and Central America.

Malcolm Byrne lecture about his Iran Contra Book

A Robert Parry Interview

A discussion of the October Surprise

Documentary Cover-Up Behind the Iran Contra Affair

My earlier series on Iran Contra

Part 1 The Secret Team

Part 2 World War 3

Part 3 The World Anti-Communist League Part 1

Part 4 The World Anti-Communist League Part 2

Ted Shackley a Life in the CIA

Old Nazis, New Right (Also covers the Coors Connection)

Subscribe to the Our Hidden History Youtube channel for dozens of Iran/Contra and CIA/Drugs related videos like my interview on Oliver North