More Details of the Iran Contra Scandal

    Table of Contents:

    1. List of Prosecutions/ Convictions
    2. Basic Facts of Iran Contra Scandal
    3. Roles of President Reagan and Vice President Bush
    4. Concluding Observations/ Policy Issues
    5. Bush Denials/ Rebuttals
    6. Reagan Denials/ Rebuttals
    7. End of this series of documents

    Conclusions, Special Prosecutor Regarding the Iran-Contra Investigation: Aug 4, 1993

    • Events that became known as the Iran-contra affair led to the most serious constitutional crisis during the presidency of Ronald Reagan. This conflict pitted the will of Congress against the powers of the executive branch. Congressional investigations in the House and Senate were launched over secret arms sales to Iran in order to finance war efforts in Nicaragua, where the Reagan administration supported contra rebels fighting to overthrow the leftist Sandinista government. At issue was the president's behavior in the matter and how much he knew about the arms sales. Neither President Reagan nor Vice President George Bush were held accountable for any wrongdoing in the matter, although fourteen others, including several top White House aids, were charged with crimes.
    • In 1984 Congress passed the second of three "Boland Amendments," named for Edward Boland (D-Mass.), chairman of the House Intelligence Committee. This amendment specifically banned aid to the contra rebels from the funds of the Central Intelligence Agency, the Pentagon, or any other part of the U.S. government. To skirt the will of Congress, and the law in the matter, Marine Lieutenant Colonel Oliver North began a clandestine operation from the White House to secretly sell arms to Iran and divert the money to the contra rebels. North also raised funds from wealthy conservatives in the United States who were willing to help underwrite the war against the Sandinistas, whom many conservatives saw as a puppet regime of the Soviet Union. Other members of the Reagan administration secretly sought help from leaders in foreign governments, including King Fahd of Saudi Arabia, who funneled upwards of $2 million per month to the contra rebels.
    • In December 1986 the U.S. Court of Appeals for the District of Columbia appointed an independent counsel, Lawrence E. Walsh, to investigate the sale and shipment of arms to Iran and the diversion of funds from such sales to Nicaragua. The independent counsel's investigation led to charges against fourteen individuals. All were convicted of various crimes mentioned in the document that follows. Two prominent figures in the case—Oliver North and John Poindexter—had their convictions overturned on appeal and President Bush pardoned two others in 1992.
    • In 1993, five years after President Reagan left office and a year after President Bush was defeated for reelection, the independent counsel submitted a three-volume Final Report of the Independent Counsel for Iran/Contra Matters to the U.S. Court of Appeals for the District of Columbia. The court ordered the Final Report to be released to the public. Although much of the evidence contained in the report was revealed in one form or another earlier in the investigation, this Final Report presented a clear statement of the issues involved in the complex web of deception, law breaking, and lies known as Iran-contra. The Final Report documented examples of the abuse of executive power and the inability and unwillingness of Congress to take firm action to correct the situation, despite House and Senate investigations into the matter. In the statements of former presidents Reagan and Bush included in volume III of the Final Report (see document 181) the Iran-contra matter was portrayed not as a major constitutional crisis, but as a disagreement over foreign policy between Congress and the White House.

      Executive Summary

    • In October and November 1986, two secret U.S. Government operations were publicly exposed, potentially implicating Reagan Administration officials in illegal activities. These operations were the prevision of assistance to the military activities of the Nicaraguan contra rebels during an October 1984 to October 1986 prohibition on such aid, and the sale of U.S. arms to Iran in contravention of stated U.S. policy and in possible violation of arms-export controls. In late November 1986, Reagan Administration officials announced that some of the proceeds from the sale of U.S. arms to Iran had been diverted to the contras.
    • As a result of the exposure of those operations, Attorney General Edwin Meese III sought the appointment of an independent counsel to investigate and, if necessary, prosecute possible crimes arising from them.
    • The Special Division of the United States Court of Appeals for the District of Columbia Circuit appointed Lawrence E. Walsh as Independent Counsel on December 19, 1986, and charged him with investigating:
      1. the direct or indirect sale, shipment, or transfer since in or about 1984 down to the present, of military arms, materiel, or funds to the government of Iran, officials of that government, persons, organizations or entities connected with or purporting to represent that government, or persons located in Iran;
      2. the direct or indirect sale, shipment, or transfer of military arms, materiel or funds to any government, entity, or person acting, or purporting to act as an intermediary in any transaction referred to above;
      3. the financing or funding of any direct or indirect sale, shipment or transfer referred to above;
      4. the diversion of proceeds from any transaction described above to or for any person, organization, foreign government, or any faction or body of insurgents in any foreign country, including, but not limited to Nicaragua;
      5. the provision or coordination of support for persons or entities engaged as military insurgents in armed conflict with the government of Nicaragua since 1984.

      Final report of that investigation: Overall Conclusions

    • The investigations and prosecutions have shown the highranking Administration officials violated laws and executive orders in Iran/contra matter.
    • Independent Counsel concluded that:
    • —sales of arms to Iran contravened United States Government policy and may have violated the Arms Export Control Act;
    • —the provision and coordination of support to the contras violated the Boland Amendment ban on aid to military activities in Nicaragua;
    • —the policies behind both the Iran and contra operations were fully reviewed and developed at the highest levels of the Reagan Administration;
    • —although there was little evidence of National Security Council level knowledge of most of the actual contra-support operations, there was no evidence that any NSC [National Security Council] member dissented from the underlying policy—keeping the contras alive despite congressional limitations on contra support;
    • —Iran operations were carried out with the knowledge of, among others, President Ronald Reagan, Vice President George Bush, Secretary of State George P. Shultz, Secretary of Defense Caspar W. Weinberger, Director of Central Intelligence William J. Casey, and national security advisers Robert C. McFarlane and John M. Poindexter; of these officials, only Weinberger and Shultz dissented from the policy decision, and Weinberger eventually acquiesced by ordering the Department of Defense to provide the necessary arms; and
    • —large volumes of highly relevant, contemporaneously created documents were systematically and willfully withheld from investigators by several Reagan Administration officials.
    • —following the revelation of these operations in October and November 1986, Reagan Administration officials deliberately deceived the Congress and the public about the level and extent of official knowledge of and support for these operations.
    • In addition, Independent Counsel concluded that the off-the-books nature of the Iran and contra operations gave line-level personnel the opportunity to commit money crimes.


    • In the course of Independent Counsel's investigation, 14 persons were charged with criminal violations. There were two broad classes of crimes charged: Operational crimes, which largely concerned the illegal use of funds generated in the course of the operations, and "cover-up" crimes, which largely concerned false statements and obstructions after the revelation of the operations. Independent Counsel did not charge violations of the Arms Export Control Act or Boland Amendment. Although apparent violations of these statutes provided the impetus for the cover-up, they are not criminal statutes and do not contain any enforcement provisions.
    • All of the individuals charged were convicted, except for one CIA official whose case was dismissed on national security grounds and two officials who received unprecedented pre-trial pardons by President Bush following his electoral defeat in 1992. Two of the convictions were reversed on appeal on constitutional grounds that in no way cast doubt on the factual guilt of the men convicted. The individuals charged and the disposition of their cases are:
      1. Robert C. McFarlane: pleaded guilty to four counts of withholding information from Congress;
      2. Oliver L. North: convicted of altering and destroying documents, accepting an illegal gratuity, and aiding and abetting in the obstruction of Congress; conviction reversed on appeal;
      3. John M. Poindexter: convicted of conspiracy, false statements, destruction and removal of records, and obstruction of Congress; conviction reversed on appeal;
      4. Richard V. Secord: pleaded guilty to making false statements to Congress;
      5. Albert Hakim: pleaded guilty to supplementing the salary of North;
      6. Thomas G. Clines: convicted of four counts of tax-related offenses for failing to report income from the operations;
      7. Carl R. Channell: pleaded guilty to conspiracy to defraud the United States;
      8. Richard R. Miller: pleaded guilty to conspiracy to defraud the United States;
      9. Clair E. George: convicted of false statements and perjury before Congress;
      10. Duane R. Clarridge: indicted on seven counts of perjury and false statements; pardoned before trial by President Bush;
      11. Alan D. Fiers, Jr.: pleaded guilty to withholding information from Congress;
      12. Joseph F. Fernandez: indicted on four counts of obstruction and false statements; case dismissed when Attorney General Richard L. Thornburgh refused to declassify information needed for his defense;
      13. Elliott Abrams: pleaded guilty to withholding information from Congress;
      14. Caspar W. Weinberger: charged with four counts of false statements and perjury; pardoned before trial by President Bush.
    • At the time President Bush pardoned Weinberger and Clarridge, he also pardoned George, Fiers, Abrams, and McFarlane.

      The Basic Facts of Iran/Contra

    • The Iran/contra affair concerned two secret Reagan Administration policies whose operations were coordinated by National Security Council staff. The Iran operation involved efforts in 1985 and 1986 to obtain the release of Americans held hostage in the Middle East through the sale of U.S. weapons to Iran, despite an embargo on such sales. The contra operations from 1984 through most of 1986 involved the secret governmental support of contra military and paramilitary activities in Nicaragua, despite congressional prohibition of this support.
    • The Iran and contra operations were merged when funds generated from the sale of weapons to Iran were diverted to support the Contra effort in Nicaragua. Although this "diversion" may be the most dramatic aspect of Iran/contra, it is important to emphasize that both the Iran and contra operations, separately, violated United States policy and law. The ignorance the "diversion" asserted by President Reagan and his Cabinet officers on the National Security Council in no way absolves them of responsibility for the underlying Iran and contra operations.
    • The secrecy concerning the Iran and contra activities was finally pierced by events that place thousands of miles apart in the fall of 1986. The first occurred on October 5, 1986, when Nicaraguan government soldiers downed an American cargo plane that was carrying military supplies to contra forces; the one surviving crew member, American Eugene Hasenfus, was taken into captivity and stated that he was employed by the CIA. A month after the Hasenfus shootdown, President Reagan's secret sale of U.S. arms to Iran was reported by a Lebanese publication on November 3. The joining of these two operations was made public on November 25, 1986, when Attorney General Meese announced that Justice Department officials had discovered that some of the proceeds from the Iran arms sales been diverted to the contras.
    • When these operations ended, the exposure of the Iran/contra affair generated a new round of illegality. Beginning with the testimony of Elliott Abrams and others in October 1986 and continuing through the public testimony of Caspar W. Weinberger on the last day of congressional hearings in the summer of 1987, senior Reagan Administration officials engaged in a concerted effort to deceive Congress and the public about their knowledge of and support for the operations.
    • Independent Counsel has concluded that the President's most senior advisers and the members on the National Security Council participated in the strategy to make National Security staff members McFarland, Poindexter and North the scapegoats whose sacrifice would protect the Reagan Administration in its final years. In an important sense, this strategy succeeded. Independent Counsel discovered much of the best evidence of the cover-up in final year of active investigation, too late for most prosecutions.

      Scope of Report

    • This report provides an account of the Independent Counsel's investigation, the prosecutions, the basis for decisions not to prosecute, and overall observations and conclusions on the Iran/contra matters.
    • Part I of the report sets out the underlying facts of the Iran and contra operations. Part II describes the criminal investigation of those underlying facts. Part M provides an analysis of the central operational conspiracy. Parts IV through IX are agencylevel reports of Independent Counsel's investigations and cases: the National Security staff, the private operatives who assisted the NSC staff, Central Intelligence Agency officials, Department of State officials, and White House officials and Attorney General Edwin Meese III.
    • Volume I of this report concludes with a chapter concerning political oversight and the rule of law, and a final chapter containing independent Counsel's observations. Volume II of the report contains supporting documentation. Volume III is a classified appendix.
    • Because many will read only sections of the report, each has been written with completeness, even though this has resulted in repetition of factual statements about central activities.

      The Operational Conspiracy

    • The operational conspiracy was the basis for Count One of the 23-count indictment returned by the Grand Jury March 16, 1988, against Poindexter, North, Secord, and Hakim. It charged the four with conspiracy to defraud the United States by deceitfully:
      1. supporting military operations in Nicaragua in defiance of congressional controls;
      2. using the Iran arms sales to raise funds to be spent at the direction of North, rather than the U.S. Government; and
      3. endangering the Administration's hostage-release effort by overcharging Iran for the arms to generate unauthorized profits to fund the contras and for other purposes.
    • The charge was upheld as a matter of law by U.S. District Judge Gerhard A. Gesell even though the Justice Department, in a move that Judge Gesell called "unprecedented," filed an amicus brief supporting North's contention that the charge should be dismissed. Although Count One was ultimately dismissed because the Reagan Administration refused to declassify information necessary to North's defense, Judge Gesell's decision established that high government officials who engage in conspiracy to subvert civil laws and the Constitution have engaged in criminal acts. Trial on Count One would have disclosed the Government-wide activities that supported North's Iran and contra operations.
    • Within the NSC, McFarlane pleaded guilty in March 1988 to four counts of withholding information from Congress in connection with his denials that North was providing the contras with military advice and assistance. McFarlane, in his plea agreement, promised to cooperate with Independent Counsel by providing truthful testimony in subsequent trials.
    • Judge Gesell ordered severance of the trials of the four charged in the conspiracy indictment because of the immunized testimony given by Poindexter, North and Hakim to Congress. North was tried and convicted by a jury in May 1989 of altering and destroying documents, accepting an illegal gratuity and aiding and abetting in the obstruction of Congress. His conviction was reversed on appeal in July 1990 and charges against North were subsequently dismissed in September 1991 on the ground that trial witnesses were tainted by North's nationally televised, immunized testimony before Congress. Poindexter in April 1990 was convicted by a jury on five felony counts of conspiracy, false statements, destruction and removal of records and obstruction of Congress. The Court of Appeals reversed his conviction in November 1991 on the immunized testimony issue.

      The Flow of Funds

    • The illegal activities of the private citizens involved with the North and Secord operations are discussed in detail in Part V. The off-the-books conduct of the two highly secret operations circumvented normal Administration accountability and congressional oversight associated with covert ventures and presented fertile ground for financial wrongdoing. There were several funding sources for the contras' weapons purchases from the covert-action Enterprise formed by North, Secord and Hakim:
      1. donations from foreign countries;
      2. contributions from wealthy Americans sympathetic to President Reagan's contra support policies; and
      3. the diversion of proceeds from the sale of arms to Iran.
    • Ultimately, all of these funds fell under the control of North, and through him, Secord and Hakim.
    • North used political fundraisers Carl R. Channell and Richard R. Miller to raise millions of dollars from wealthy Americans, illegally using a tax-exempt organization to do so. These funds, along with the private contributions, were run through a network of corporations and Swiss bank accounts put at North's disposal by Secord and Hakim, through which transactions were concealed and laundered. In late 1985 through 1986 the Enterprise became centrally involved in the arms sales to Iran. As a result of both the Iran and contra operations, more than $47 million flowed through Enterprise accounts.
    • Professional fundraisers Channell and Miller pleaded guilty in the spring of 1987 to conspiracy to defraud the Government by illegal use of a tax-exempt foundation to raise contributions for the purchase of lethal supplies for the contras. They named North as an unindicted co-conspirator.
    • Secord pleaded guilty in November 1989 to a felony, admitting that he falsely denied to Congress that North had personally benefited from the Enterprise. Hakim pleaded guilty to the misdemeanor count of supplementing the salary of North. Lake Resources Inc., the company controlled by Hakim to launder the Enterprise's money flow, pleaded guilty to the corporate felony of theft of Government property in diverting the proceeds from the arms sales to the contras and for other unauthorized purposes. Thomas G. Clines was convicted in September 1990 of four tax-related felonies for failing to report all of his income from the Enterprise.

      Agency Support of the Operations

    • Following the convictions of those who were most central to the Iran/contra operations, Independent Counsel's investigation focused on the supporting roles played by Government officials in other agencies and the supervisory roles of the NSC principals. The investigation showed that Administration officials who claimed initially that they had little knowledge about the Iran arms sales or the illegal contra-resupply operation North directed were much better informed than they professed to be. The Office of Independent Counsel [OIC] obtained evidence that Secretaries Weinberger and Shultz and White House Chief of Staff Donald T. Regan, among others, held back information that would have helped Congress obtain a much clearer view of the scope of the Iran/contra matter. Contemporaneous notes of Regan and Weinberger, and those dictated by Shultz, were withheld until they were obtained by Independent Counsel in 1991 and 1992.

      The White House and Office of the Vice President

      [See also responses by Reagan and Bush below.]
    • As the White House section of this report describes in detail, the investigation found no credible evidence that President Reagan violated any criminal statute. The OIC could not prove that Reagan authorized or was aware of the diversion or that he had knowledge of the extent of North's control of the contra-resupply network. Nevertheless, he set the stage for the illegal activities of others by encouraging and, in general terms, ordering support of the contras during the October 1984 to October 1986 period when funds for the contras were cut off by the Boland Amendment, and in authorizing the sale of arms to Iran, in contravention of the U.S. embargo on such sales. The President's disregard for civil laws enacted to limit presidential actions abroad—specifically the Boland Amendment, the Arms Export Control Act and congressional-notification requirements in covert-action laws—created a climate in which some of the Government officers assigned to implement his policies felt emboldened to circumvent such laws.
    • President Reagan's directive to McFarlane to keep the contras alive "body and soul" during the Boland cut-off period was viewed by North, who was charged by McFarlane to carry out the directive, as an invitation to break the law. Similarly, President Reagan's decision in 1985 to authorize the sale of arms to Iran from Israeli stocks, despite warnings by Weinberger and Shultz that such transfers might violate the law, opened the way for Poindexter's subsequent decision to authorize the diversion. Poindexter told Congress that while he made the decision on his own and did not tell the President, he believed the President would have approved. North testified that he believed the President authorized it.
    • Independent Counsel's investigation did not develop evidence that proved that Vice President Bush violated any criminal statute. Contrary to his public pronouncements, however, he was fully aware of the Iran arms sales. Bush was regularly briefed, along with the President, on the Iran arms sales, and he participated in discussions to obtain third-country support for the contras. The OIC obtained no evidence that Bush was aware of the diversion. The OIC teamed in December 1992 that Bush had failed to produce a diary containing contemporaneous notes relevant to Iran/contra despite requests made in 1987 and again in early 1992 for the production of such material. Bush refused to be interviewed for a final time in light of evidence developed in the latter stages of OIC's investigation, leaving unresolved a clear picture of his Iran/contra involvement. Bush's pardon of Weinberger on December 24, 1992 preempted a trial in which defense counsel indicated that they intended to call Bush as a witness.
    • The chapters on White House Chief of Staff Regan and Attorney General Edwin Meese III focus on their actions during the November 1986 period, as the President and his advisers sought to control the damage caused by the disclosure of the Iran arms sales. Regan in 1992 provided Independent Counsel with copies of notes showing that Poindexter and Meese attempted to create a false account of the 1985 arms sales from Israeli stocks, which they believed were illegal, in order to protect the President. Regan and the other senior advisers did not speak up to correct the false version of events. No final legal determination on the matter had been made. Regan said he did not want to be the one who broke the silence among the President's senior advisers, virtually all of whom knew the account was false.
    • The evidence indicates that Meese's November 1986 inquiry was more of a damage-control exercise than an effort to find the facts. He had private conversations with the President, the Vice President, Poindexter, Weinberger, Casey and Regan without taking notes. Even after teaming of the diversion, Meese failed to secure records in NSC staff offices or take other prudent steps to protect potential evidence. And finally, in reporting to the President and his senior advisers, Meese gave a false account of what he had been told by stating that the President did not know about the 1985 HAWK shipments, which Meese said might have been illegal. The statute of limitations had run on November 1986 activities before OIC obtained its evidence. In 1992, Meese denied recollection of the statements attributed to him by the notes of Weinberger and Regan. He was unconvincing, but the passage of time would have been expected to raise a reasonable doubt of the intentional falsity of his denials if he had been prosecuted for his 1992 false statements.

      The Role of CIA Officials

    • Director Casey's unswerving support of President Reagan's contra policies and of the Iran arms sales encouraged some CIA officials to go beyond legal restrictions in both operations. Casey was instrumental in pairing North with Secord as a contra-support team when the Boland Amendment in October 1994 forced the CIA to refrain from direct or indirect aid. He also supported the North-Secord combination in the Iran arms sales, despite deep reservations about Secord within the CIA hierarchy.
    • Casey's position on the contras prompted the chief of the CIA's Central American Task Force, Alan D. Fiers, Jr., to "dovetail" CIA activities with those of North's contra-resupply network, in violation of Boland restrictions. Casey's support for the NSC to direct the Iran arms sales and to use arms dealer Manucher Ghorbanifar and Secord in the operation, forced the CIA's Directorate of Operations to work with people it distrusted.
    • Following the Hasenfus shootdown in early October 1986, George and Fiers lied to Congress about U.S. Government involvement in contra resupply, to, as Fiers put it, "keep the spotlight off the White House." When the Iran arms sales became public in November 1986, three of Casey's key office officers—George, Clarridge and Fiers—followed Casey's lead in misleading Congress.
    • Four CIA officials were charged with criminal offense—George the deputy director for operations and the third highest-ranking CIA official; Clarridge, chief of the European Division; Fiers; and Fernandez. George was convicted of two felony counts of false statements and perjury before Congress. Fiers pleaded guilty to two misdemeanor counts of withholding information from Congress. The four counts of obstruction and false statements against Fernandez were dismissed when the Bush Administration refused to declassify information needed for his defense. Clarridge was awaiting trial on seven counts of perjury and false statements when he, George and Piers were pardoned by President Bush.

      State Department Officials

    • In 1990 and 1991, Independent Counsel received new documentary evidence in the form of handwritten notes suggesting that Secretary Shultz's congressional testimony painted a misleading and incorrect picture of his knowledge of the Iran arms sales. The subsequent investigation focused on whether Shultz or other Department officials deliberately misled or withheld information from congressional or OIC investigators.
    • The key notes, taken by M. Charles Hill, Shultz's executive assistant, were nearly verbatim, contemporaneous accounts of Shultz's meetings within the department and Shultz's reports to Hill on meetings the secretary attended elsewhere. The Hill notes and similarly detailed notes by Nicholas Platt, the State Department's executive secretary, provided the OIC with a detailed account of Shultz's knowledge of the Iran arms sale. The most revealing of these notes were not provided to any Iran/Contra investigation until 1990 and 1991. The notes show that—contrary to his early testimony that he was not aware of details of the 1985 arms transfers—Shultz knew that the shipments were planned and that they were delivered. Also in conflict with his congressional testimony was evidence that Shultz was aware of the 1986 shipments.
    • Independent Counsel concluded that Shultz's early testimony was incorrect, if not false, in significant respects, and misleading, if literally true, in others. When questioned about the discrepancies in 1992, Shultz did not dispute the accuracy of the Hill notes. He told OIC that he believed his testimony was accurate at the time and he insisted that if he had been provided with the notes earlier, he would have testified differently. Independent Counsel declined to prosecute because there was a reasonable doubt that Shultz's testimony was willfully false at the time it was delivered.
    • Independent Counsel concluded that Hill had willfully withheld relevant notes and prepared false testimony for Shultz in 1987. He declined to prosecute because Hill's claim of authorization to limit the production of his notes and the joint responsibility of Shultz for the resulting misleading testimony, would at trial have raised a reasonable doubt, after Independent Counsel had declined to prosecute Shultz.
    • Independent Counsel's initial focus on the State Department had centered on Assistant Secretary Elliott Abrams' insistence to Congress and to the OIC that he was not aware of North's direction of the extensive contra-resupply network in 1985 and 1986. As assistant secretary of state for inter-American affairs, Abrams chaired the Restricted Inter-Agency Group, or RIG, which coordinated U.S. policy in Central America. Although the OIC was skeptical about Abrams' testimony, there was insufficient evidence to proceed against him until additional documentary evidence inculpating him was discovered in 1990 and 1991, and until Fiers, who represented the CIA on the RIG, pleaded guilty in July 1991 to withholding information from Congress. Fiers provided evidence to support North's earlier testimony that Abrams was knowledgeable about North's contra-supply network. Abrams pleaded guilty in October 1991 to two counts of withholding information from Congress about secret Government efforts to support the contras, and about his solicitation of $10 million to aid the contras from the Sultan of Brunei.

      Secretary Weinberger and Defense Department Officials

    • Contrary to their testimony to the presidentially appointed Tower Commission and the Select Iran/contra Committees of Congress, Independent Counsel determined that Secretary Weinberger and his closest aides were consistently informed of proposed and actual arms shipments to Iran during 1985 and 1986. The key evidence was handwritten notes of Weinberger, which he deliberately withheld from Congress and the OIC until they were discovered by independent counsel in late 1991. The Weinberger daily diary notes and notes of significant White House and other meetings contained highly relevant, contemporaneous information that resolved many questions left unanswered in early investigations.
    • The notes demonstrated that Weinberger's early testimony—that he had only vague and general information about Iran arms sales in 1985—was false, and that he in fact had detailed information on the proposed arms sales and the actual deliveries. The notes also revealed that Gen. Colin Powell, Weinberger's senior military aide, and Richard L. Armitage, assistant secretary of defense for international security affairs, also had detailed knowledge of the 1985 shipments from Israeli stocks. Armitage and Powell had testified that they did not learn of the November 1985 HAWK missile shipment until 1986.
    • Weinberger's notes provided detailed accounts of high-level Administration meetings in November 1986 in which the President's senior advisers were provided with false accounts of the Iran arms sales to protect the President and themselves from the consequences of the possibly illegal 1995 shipments from Israeli stocks.
    • Weinberger's notes provided key evidence supporting the charges against him, including perjury and false statements in connection with his testimony regarding the arms sales, his denial of the existence of notes and his denial of knowledge of Saudi Arabia's multi-million dollar contribution to the contras. He was pardoned less than two weeks before trial by President Bush on December 24, 1992.
    • There was little evidence that Powell's early testimony regarding the 1985 shipments and Weinberger's notes was willfully false. Powell cooperated with the various Iran/contra investigations and, when his recollection was refreshed by Weinberger's notes, he readily conceded their accuracy. Independent Counsel declined to prosecute Armitage because the OIC's limited resources were focused on the case against Weinberger and because the evidence against Armitage, while substantial, did not reach the threshold of proof beyond a reasonable doubt.

      The Reagan, Bush and Casey Segments

    • The Independent Counsel Act requires a report as to persons not indicted as well as those indicted. Because of the large number of persons investigated, those discussed in individual sections of this report are limited to those as to whom there was a possibility of indictment. In addition there are separate sections on President Reagan and President Bush because, although criminal proceedings against them were always unlikely, they were important subjects of the investigation, and their activities were important action taken with respect to others.
    • CIA Director Casey is a special case. Because Casey was hospitalized with a fatal illness before Independent Counsel was appointed, no formal investigation of Casey was ever undertaken by the OIC. Casey was never able to give his account, and he was unable to respond to allegations of wrongdoing made about him by others, most prominently North, whose veracity is subject to serious question. Equally important, fundamental questions could not be answered regarding Casey's state of mind, the impact, if any, of his fatal illness on his conduct and his intent.
    • Under normal circumstances, a prosecutor would hesitate to comment on the conduct of an individual whose activities and actions were not subjected to rigorous investigation, which might exculpate that individual. Nevertheless, after serious deliberation, Independent Counsel concluded that it was in the public interest that this report expose as full and complete an account of the Iran/contra matter as possible. This simply could not be done without an account of the, role of Director Casey.

      Part XI— Concluding Observations

    • The underlying facts of Iran/contra are that, regardless of criminality, President Reagan, the secretary of state, the secretary of defense, and the director of central intelligence and their necessary assistants committed themselves, however reluctantly, to two programs contrary to congressional policy and contrary to national policy. They skirted the law, some of them broke the law, and almost all of them tried to cover up the President's willful activities.
    • What protection do the people of the United States have against such a concerted action by such powerful officers? The Constitution provides for congressional oversight and congressional control of appropriations, but if false information is given to Congress, these checks and balances are of lessened value. Further, in the give and take of the political community, congressional oversight is often overtaken and subordinated by the need to keep Government functioning, by the need to anticipate the future, and by the ever-present requirement of maintaining consensus among the elected officials who are the Government.
    • The disrespect for Congress by a popular and powerful President and his appointees was obscured when Congress accepted the tendered concept of a runaway conspiracy of subordinate officers and avoided the unpleasant confrontation with a powerful President and his Cabinet. In haste to display and conclude its investigation of this unwelcome issue, Congress destroyed the most effective lines of inquiry by giving immunity to Oliver L. North and John M. Poindexter so that they could exculpate and eliminate the need for the testimony of President Reagan and Vice President Bush.
    • Immunity is ordinarily given by a prosecutor to a witness who will incriminate someone more important than himself Congress gave immunity to North and Poindexter, who incriminated only themselves and who largely exculpated those responsible for the initiation, supervision and support of their activities. This delayed and infinitely complicated the effort to prosecute North and Poindexter, and it largely destroyed the likelihood that their prompt conviction and appropriate sentence would induce meaningful cooperation.
    • These important political decisions were properly the responsibility of Congress. It was for the Committees to decide whether the welfare of the nation was served or endangered by a continuation of its investigation, a more deliberate effort to test the self-serving denials presented by Cabinet officers and to search for the full ramifications of the activities in question. Having made this decision, however, no one could gainsay the added difficulties thrust upon Independent Counsel. These difficulties could be dealt with only by the investment of large amounts of additional time and large amounts of expense.
    • The role of Independent Counsel is not well understood. Comparisons to United States attorneys, county district attorneys, or private law offices do not conceive the nature of Independent Counsel. Independent Counsel is not an individual put in charge of an ongoing agency as an acting U.S. attorney might be; he is a person taken from private practice and told to create a new agency, to carry out the mission assigned by the court. It is not as though he were told to step in and try a case on the calendar of an ongoing office with full support of the Government behind him, as it would be behind the United States attorney. He is told to create an office and to confront the Government without any expectation of real cooperation, and, indeed, with the expectation of hostility, however veiled. That hostility will manifest itself in the failure to declassify information, in the suppression of documents, and in all of the evasive techniques of highly skilled and large, complex organizations.
    • The investigation into Iran/contra nevertheless demonstrates that the rule of law upon which our democratic system of government depends can be applied to the highest officials even when they are operating in the secret areas or diplomacy and national security.
    • Despite extraordinary difficulties imposed by the destruction and withholding of records, the need to protect classified information, and the congressional grants of immunity to some of the principals involved, Independent Counsel was able to bring criminal charges against nine government officers and five private citizens involved in illegal activities growing out of the Iran/contra affair.
    • More importantly, the investigation and the prosecutions arising out of it have provided a much more accurate picture of how two secret Administration policies keeping the contras alive "body and soul" during the Boland cutoff period and seeking the release of Americans held hostage by selling arms to Iran veered off into criminality.
    • Evidence obtained by Independent Counsel establishes that the Iran/contra affair was not an aberrational scheme carried out by a "cabal of zealots" on the National Security Council staff, as the congressional Select Committees concluded in their majority report. Instead, it was the product of two foreign policy directives by President Reagan which skirted the law and which were executed by the NSC staff with the knowledge and support of high officials in the CIA, State and, Defense departments, and to a lesser extent, officials in other agencies.
    • Independent Counsel found no evidence of dissent among his Cabinet officers from the President's determination to support the contras after federal law banned the use of appropriated funds for that purpose in the Boland Amendment in October 1984. Even the two Cabinet officers who opposed the sale of arms to Iran on the grounds that it was illegal and bad policy—Defense Secretary Caspar W. Weinberger and Secretary of State George P. Shultz—either cooperated with the decision once made, as in the case of Weinberger, or stood aloof from it while being kept informed of its progress, as was the case of Shultz.
    • In its report section titled "Who Was Responsible," the Select Committees named CIA Director William Casey, National Security Advisers Robert C. McFarlane and John M. Poindexter, along with NSC staff member Oliver L. North, and private sector operatives Richard V. Secord and Albert Hakim. With the exception of Casey who died before he could questioned by the OIC, Independent Counsel and obtained criminal convictions of charges of each of the men named by Congress. There is little doubt that, operationally, these men were central players.
    • But the investigation and prosecutions have shown that these six were not out-of-control mavericks who acted alone without the knowledge or assistance of others. The evidence establishes that the central NSC operatives kept their superiors—including Reagan, Bush, Shultz, Weinberger and other high officials—informed of their efforts generally, if not in detail, and their superiors either condoned or turned a blind eye to them. When it was required, the NSC principals and their private sector operatives received the assistance of high-ranking officers in the CIA, the Defense Department, and the Department of State.
    • Of the 14 persons charged criminally during the investigation, four were convicted of felony charges after trial by jury, seven pleaded guilty either to felonies or misdemeanors, and one had his case dismissed because the Administration refused to declassify information deemed necessary to the defendant by the trial judge. Two cases that were awaiting trial were aborted by pardons granted by President Bush. As this report explained earlier, many persons who committed crimes were not charged. Some minor crimes were never investigated and some that were investigated were not solved. But Independent Counsel believes that to the extent possible, the central Iran/contra crimes were vigorously prosecuted and the significant acts of obstruction were fully charged.
    • Fundamentally, the Iran/contra affair was the first known criminal assault on the post-Watergate rules governing the activities of national security officials. Reagan Administration officials rendered these rules ineffective by creating private operations, supported with privately generated funds that successfully evaded executive and legislative oversight and control. Congress was defrauded. Its appropriations restrictions having been circumvented, Congress was led to believe that the Administration was following the law. Numerous congressional inquiries were thwarted through false testimony and the destruction and concealment of government records.
    • The destruction and concealment of records and information, beginning at the twilight of Iran/contra and continuing throughout subsequent investigations, should be of particular concern. Oliver North's destruction of records in October and November 1986 caused an irretrievable loss of information to the executive agencies responsible for regulating clandestine activities, to Congress, and to Independent Counsel. John Poindexter's efforts to destroy NSC electronic mail nearly resulted in comparable damage. CIA Costa Rican Station Chief Joseph F. Fernandez attempted to hide phone records that would have revealed his contacts with Enterprise activities.
    • This sort of obstruction continued even after Independent Counsel's appointment. In the course of his work, Independent Counsel located large caches of handwritten notes and other documents maintained by high officials that were never relinquished to investigators. Major aspects of Iran/contra would never have been uncovered had all of the officials who attempted to destroy or withhold their records of the affair succeeded. Had these contemporaneous records been produced to investigators when they were initially requested, many of the troublesome conflicts between key witnesses would have been resolved, and timely legal steps taken toward those who feigned memory lapses or lied outright.
    • All of this conduct—the evasions of the Executive branch and the Congress, the lies, the conspiracies, the acts of obstruction—had to be addressed by the criminal justice system.
    • The path Independent Counsel embarked upon in late 1986 had been a long and arduous one. When he hired 10 attorneys in early 1987, Independent Counsel's conception of the operational conspiracy—with its array of Government officials and private contractors, its web of secret foreign accounts, and its world-wide breadth—was extremely hazy. Outlining an investigation of a runaway conspiracy disavowed by the President was quite different from the ultimate investigation of the President and three major agencies, each with the power to frustrate an investigation by persisting in the classification of non-secret but embarrassing information. Completing the factual mosaic required examining pieces spread worldwide in activities that occurred over a three-year period by officials from the largest agencies of government and a host of private operatives who, by necessity, design and training, worked secretly and deceptively. . . . .

      Final Thoughts

    • The Iran/contra investigation will not end the kind of abuse of power that it addressed any more than the Watergate investigation did. The criminality in both affairs did not arise primarily out of ordinary venality or greed, although some of those charged were driven by both. Instead, the crimes committed in Iran/contra were motivated by the desire of persons in high office to pursue controversial policies and goals even when the pursuit of those policies and goals was inhibited or restricted by executive orders, statutes or the constitutional system of checks and balances.
    • The tone in Iran/contra was set by President Reagan. He directed that the contras be supported, despite a ban on contra aid imposed on him by Congress. And he was willing to trade arms to Iran for the release of Americans held hostage in the Middle East, even if doing so was contrary to the nation's stated policy and possibly in violation of the law.
    • The lesson of Iran/contra is that if our system of government is to function properly, the branches of government must deal with one another honestly and cooperatively. When disputes arise between the Executive and Legislative branches, as they surely will, the laws that emerge from such disputes must be obeyed.
    • When a President, even with good motive and intent, chooses to skirt the laws or to circumvent them, it is incumbent upon his subordinates to resist, not join in. Their oath and fealty are to the Constitution and the rule of law, not to the man temporarily occupying the Oval Office. Congress has the duty and the power under our system of checks and balances to ensure that the President and his Cabinet officers are faithful to their oaths.
    • Source: Final Report of the Independent Counsel for Iran/Contra Matters, Vol. 1: Investigations and Prosecutions, August 4, 1993 (Washington, D.C.: U.S. Government Printing Office, 1993), xiii–xxi, 561–566.

      Presidents Bush and Reagan Regarding Their Role in Iran-Contra: Dec 3, 1993

    • Historical Background: The Iran-contra affair was the most significant constitutional crisis between the executive branch and Congress during the presidency of Ronald Reagan. The Iran-contra investigation by independent counsel Lawrence E. Walsh took almost seven years to complete. As part of the Final Report of the Independent Counsel for Iran/Contra Matters, published for the first time in 1993, former presidents Ronald Reagan and George Bush submitted statements for the record, through their attorneys, that gave their views on the Iran-contra affair. The independent counsel's investigation concluded that both President Reagan and then Vice President Bush, as well as other top administration officials, had knowledge of the Iran operations.
    • In Bush's statement, he concluded that the investigation had ''largely been an inquiry into a political dispute between a Republican Administration and a Democratic Congress over foreign policy." While recognizing the affair as a serious constitutional struggle between Congress and the White House over the conduct of foreign policy, Bush objected to the independent counsel's attempt to turn this partisan political struggle into criminal behavior. In his statement Bush also explained why, on Christmas eve 1992—just weeks before his term of office was up—he pardoned former secretary of defense Caspar Weinberger and others convicted in the Iran-contra affair.
    • In the statement prepared by President Reagan's attorneys, Reagan concluded that "the Iran-Contra Independent Counsel has misused and abused the reporting process that is mandated by the independent counsel statute. The Final Report unfairly and unnecessarily injures the rights and reputations of individuals, relies on innuendo, speculation, and conjecture instead of proof, violates established standards governing the conduct of prosecutors, and improperly relies on secret grand jury materials to support the Independent Counsel's many accusations."

      Statement of Former President George H. W. Bush

    • Portrait of George H. W. BushThe investigation conducted by the Office of Independent Counsel ("OIC") under Judge Lawrence Walsh has largely been an inquiry into a political dispute between a Republican administration and a Democratic Congress over foreign policy. OIC has spent over six years and $40 million trying to give a criminal hue to the serious constitutional struggle over separation of powers between the Congress and the Executive in the foreign policy area. While the Report speculates that laws were broken by certain Administration officials other than President Bush, the real thrust of its conclusions relate to purported contravention of government policy. The Independent Counsel's authorizing legislation did not contemplate the investigation of such policy differences.
    • Congress has used the Independent Counsel statute as a tool for inserting itself into foreign policy, which is reserved under the Constitution to the Executive. An attempt to criminalize public policy differences jeopardizes any President's ability to govern. By seeking to craft criminal violations from a political foreign policy dispute, OIC was cast in a biased Position from the beginning. Notwithstanding this inherent bias, however, the Report does not and cannot dispute that:
    • (1) President Bush was unaware of the contra diversion as he has always maintained;
    • (2) President Bush told the truth in both his 1988 deposition to the OIC, which subsequently he released to the public, and in his 1987 FBI interview; and
    • (3) President Bush never violated any criminal statute.
    • Furthermore, despite statements or inferences in the Report to the contrary:
    • (1) President Bush issued the pardons of Caspar Weinberger and others because he believed it was the right and courageous thing to do. He was not concerned about the upcoming trials nor that he might be called as a witness by the defense.
    • (2) President Bush completely cooperated with OIC's investigation. As the Report even states, he told his staff to "give them [OIC] everything."
    • (3) President Bush had no idea that his personal, political thoughts, dictated well after the events of Iran-contra, were responsive to any OIC document requests until a member of his staff discovered them in a safe and reviewed them in late September 1992. President Bush immediately directed that the diary be turned over to White House Counsel Boyden Gray for his review, which was done. Mr. Gray subsequently produced the diary to OIC in December.
    • (4) President Bush's diary was exculpatory and would have had no material effect on the investigation had it been produced sooner. The Report acknowledges that the contents of the diary did not justify a reopening of the investigation.
    • (5) President Bush, through King & Spalding, provided OIC with thousands of additional documents in 1993 that related, generally to Iran-contra, even though OIC had declared months earlier that the investigation was finished.
    • (6) President Bush would have a to a final interview/deposition under reasonable conditions. OIC refused to negotiate and decided to simply declare in its Report that the President was uncooperative.

      I—Iran Arms Sale

    • President Bush has always acknowledged that he was aware that arms were sold to Iran. The Report offers nothing new on this issue.
    • On December 3, 1986, then Vice-President Bush told the American public about his knowledge of the Iran arms initiative immediately after the story broke:
    • I was aware of our Iran initiative and I support the President's decision. I was not aware of and I oppose any diversion of funds, any ransom payments, or any circumvention of the will of the Congress, the law or the United States of America.

      Speech to American Enterprise Institute ("AEI")

    • This statement was accurate, and the Report offers no evidence to the contrary. Inexplicably, however the Report contends that President Bush's public statements conflicted with his deposition testimony and FBI interview, all of which reflected his knowledge of the Iran arms sales. The Report is simply wrong.
    • Most importantly President Bush did not believe there was anything illegal about the arms sale to Iran. In fact, after six years of investigation and expenditures of $40 million, OIC remains unsure whether any laws were violated by the arms sale. As the Report acknowledges, the Reagan Administration Justice Department issued an opinion that the shipments of U.S. weapons to Iran did not violate the law. President Bush was never advised by anyone that the Iran arms shipments were illegal.

      II—Contra Diversion

    • President Bush was unaware of the contra diversion until the news of the diversion broke publicly in November 1986. The Report confirms this fact.
    • Moreover, the Report found that there was an effort to keep then Vice-President Bush and his staff in the dark about the entire resupply effort:
    • There was no credible evidence obtained that the Vice-President or any member of his staff directly or actively participated in the contra resupply effort that existed during the Boland Amendment prohibition on military aid to the contras. To the contrary, the OVP's [Office of the Vice President] staff was largely excluded from RIG meetings when contra matters were discussed and during which North openly discussed operational details of his contra efforts.

      The Pardons

    • OIC contends that defense counsel for Caspar Weinberger indicated their intent to call President Bush as a witness. In fact, President Bush was never subpoenaed or included on any witness list.
    • The sole allusion to the possibility that Secretary Weinberger's counsel might attempt to call President Bush occurred two weeks before the Weinberger trial was to com- mence in a pre-trial conference during which numerous matters were discussed. The possibility that President Bush would actually be called to testify was always remote. Furthermore, there was little chance that President Bush would actually be required to testify even if called. Secretary Weinberger's counsel did not give any notice to the White House of an intent to call President Bush nor was it likely that counsel could have made the required showing that President Bush would provide any testimony that Could not have been obtained through other means. The slim possibility that he could be called as a witness was not a factor in issuing the pardons.

      IV—President Bush's Diary

    • President Bush issued the pardons of Caspar Weinberger and others on December 24, 1992.
    • That evening, Judge Walsh publicly proclaimed President Bush to be a "subject" of his investigation on ABC's Nightline for allegedly failing to produce earlier a personal diary of primarily political thoughts. The public pronouncement constituted a remarkable departure from prevailing prosecutorial standards of conduct. Judge Walsh then began a new investigation into the timing of the production of the Bush diary, a diary that was exculpatory and contained information that would have helped, not hurt, President Bush's reelection chances.
    • At the time of Judge Walsh's proclamation, OIC had already reviewed the diary and was aware of its personal, political nature. As OIC later stated in its Report, the Bush diary did not warrant a reopening of the investigation.
    • As the Report also acknowledges, "Bush's notes themselves proved not as significant" as others. In fact, the diary was made after the events of Iran-contra and corroborated his lack of knowledge as events were uncovered.
    • The Report implies that President Bush was aware that his diary dictation was responsive to OIC's document requests and purposefully did not produce the material. In support, the Report cites a 1987 Bush diary entry that indicates surprise at Secretary Shultz' production of his personal, contemporaneous notes dictated immediately following meetings with President Reagan. Contrary to the Report's implication, President Bush never believed that his random, personal dictation on a variety of issues, contemporaneous only with the aftermath and not the events of Iran-contra, was responsive to any OIC document request until September 1992 when his staff reviewed the diary. President Bush was concerned, however, that by keeping their own, sometimes unreliable notes of confidential communications with the President, cabinet members could have a chilling effect upon the ability of the Executive to benefit from frank and candid discussions. Hence, the passage in his diary relating to Secretary Shultz notes.
    • The bottom line is that President Bush turned over all of his responsive documents on Iran-contra.

      V— President Bush's Cooperation

    • Completely at odds with the Report's implication of willful withholding of documents is the following passage in the Report: Related to the issue of the diary was the production of the chron files. When the Iran/contra document request was circulated, Bush instructed [Suzie] Peake to "just give them everything." (Emphasis added.)
    • The Report fails to acknowledge that Peake was one of the people who typed the dictated diary. If President Bush was trying to withhold the diary, he never would have given Peake such an instruction. Furthermore, none of the other staff members who had knowledge of President Bush's diary dictation, Don Rhodes, Jack Steel, and Betty Green, believed that the diary was responsive to OIC's document requests.
    • The Report does acknowledge that when the diary was discovered in a personal safe by Patty Presock in late September 1992, President Bush, who was in the middle of the campaign, immediately stated "let's call Boyden and he can sort it out." Mr. Gray subsequently reviewed and turned over the diary to OIC. President Bush's policy was always to provide OIC whatever material it requested.

      A—1993 Document Production

    • The Report contends that in 1993 King & Spalding adopted a "very narrow approach to the OIC document request, allowing production of only those materials that related to the production of the diary." The report asserts that King & Spalding claimed that all other documents requested wore protected by the attorney-client privilege. Again, OIC's position is contrary to the facts.
    • By letter dated January 27, 1993 . . . King & Spalding informed OIC as follows:
    • Although it is our understanding that the [OIC is] investigating the delay in the production of President Bush's November/December 1986 dictation transcripts, consistent with your request we will nevertheless provide you non-privileged documents which related generally to Irancontra.
    • In accordance with our representation, King & Spalding reviewed 111 boxes of files stored at the National Archives and produced approximately 6,500 pages of nonprivileged documents related to Iran-contra and unrelated to the diary production issue. King & Spalding also produced all documents, regardless of privilege, related to the diary production.
    • OIC lawyers originally directed King & Spalding to review 400 boxes of documents stored at the Bush Presidential Materials Project in College Station, Texas but later backed off once they realized the breadth of their request. (See letter dated February 22, 1993, Attachment 3). King & Spald- ing subsequently produced 326 pages of documents from College Station relating to the diary production issue.
    • Finally, King & Spalding also produced President Bush's "chron" files to OIC in their entirety, constituting in excess of 29,000 pages of documents. (The chron files had been made available to OIC prior to then Vice-President Bush's deposition in 1988.) Only a total of 14 documents were withheld because of attorney-client privilege. President Bush never asserted, as would be his right, executive privilege over any documents.

      B—Interview of George Bush

    • President Bush fully cooperated with the OIC investigation. He voluntarily gave a 5 hour videotaped deposition to OIC lawyers in 1988 covering the entire subject of Irancontra. In addition, he was interviewed at length by the FBI. In all respects, he was truthful and candid—the Report never contends otherwise.
    • The Report, however, contends that the investigation of President Bush was somehow incomplete, citing OIC's inability to question President Bush further in 1993. As is evident by the following chronology, OIC had effectively finished its investigation in September 1992 and absent the issuance of the pardons would never have sought another deposition of President Bush.
    • In the summer of 1992, OIC indicated to the White House that it might seek additional information from President Bush in the form of interrogatories. Later in the summer, OIC postponed until after the election any request for additional information.
    • In September 1992, OIC reported to the special D.C. Court of Appeals panel (the "Special Panel") that the investigation was complete, barring unforeseen developments at the upcoming Weinberger and Claridge trials. The Report's admission that OIC had concluded its investigation is inconsistent with any need or even desire on the part of OIC to interview President Bush again on the substance of Iran-contra.
    • After the election, OIC remained silent regarding the notion of obtaining additional information from President Bush through interrogatories.
    • OIC did not renew its request for responses to interrogatories even after the White House informed OIC on December 11, 1992 about the discovery of President Bush's personal dictation.
    • It was the issuance of the pardons on December 24, 1992 that triggered OIC's deposition request to President Bush and the general reopening of the investigation.
    • In its Report, OIC misstated the negotiations, or lack thereof, surrounding a possible second Bush deposition in 1993. The following are the facts.
    • First, Judge Walsh turned down Griffin Bell's offer to have Judge Walsh conduct President Bush's deposition. Judge Walsh stated that he was too busy preparing the Report and that it would be necessary for his deputy, Craig Gillen, to conduct the deposition.
    • In addition to Judge Walsh's refusal to conduct the deposition, OIC refused to consider any reasonable limitations on the deposition, including the following specific proposals:
      1. That the deposition be conducted in Houston or any location other than OIC's office in D.C.
      2. That there be some general understanding of the time to be devoted to the deposition. OIC would not even commit to finishing in one day.
      3. That there be an agreement as to the scope of the questioning. We would have considered favorably a request to explore new Iran/contra material or issues, in addition to the questions surrounding production of the diary. OIC made no counterproposal.
      4. That the inquiry be conducted, as originally contemplated, through interrogatories.
      5. That there be some assurances concerning the purpose of the inquiry and OIC's intent.
    • OIC never discussed with King & Spalding lawyers any one of these proposals, as King & Spalding fully expected OIC would. Mr. Gillen's response in his February 26, 1993 letter . . . was that "further negotiation was pointless." In fact, OIC refused to negotiate on any points.
    • If OIC believed that President Bush had important additional information as the Report suggests, OIC would have negotiated over the terms of a voluntary deposition. If President Bush remained an "important witness," despite having already submitted to a lengthy deposition and FBI interview OIC would have issued a grand jury subpoena. OIC's excuse for not doing so, the absence of an "appropriate likelihood of a criminal prosecution," misstates the standard for issuance of a grand jury subpoena to a witness.

      VI—Remaining Questions for President Bush

    • The Report lists seven areas of inquiry that OIC would have covered with President Bush had another deposition occurred in 1993. Any deposition would have been cumulative of the previous wide-ranging deposition and FBI interview conducted of President Bush.
    • Three months before the pardons issued, OIC represented to the Special Panel that the investigation was finished. Thereafter, no circumstances changed that warranted another deposition of President Bush. Certainly, the diary produced in December 1992 did not warrant an additional deposition on the substance of Iran-contra. OIC's own Report stated "They [the diaries] did not justify re-opening the investigation."
    • President Bush's knowledge of Iran-contra has been explored to exhaustion, beginning with his December 3, 1986 speech to AEI, continuing with his 5 hour deposition by OIC, his FBI interview and countless press conferences and inquiries. OIC's suggestion that the investigation of President Bush was "regrettably incomplete" is nonsense.

      Reagan Responses to Iran Contra

      [Compare this televised speech, given on March 4, 1987, with later Reagan statements found below.] Source: Reagan Speech about Iran Contra, delivered March 4, 1987
    • My fellow Americans: I've spoken to you from this historic office on many occasions and about many things. The power of the Presidency is often thought to reside within this Oval Office. Yet it doesn't rest here; it rests in you, the American people, and in your trust. Your trust is what gives a President his powers of leadership and his personal strength, and it's what I want to talk to you about this evening.
    • For the past 3 months, I've been silent on the revelations about Iran. And you must have been thinking: "Well, why doesn't he tell us what's happening? Why doesn't he just speak to us as he has in the past when we've faced troubles or tragedies?" Others of you, I guess, were thinking: "What's he doing hiding out in the White House?" Well, the reason I haven't spoken to you before now is this: You deserve the truth. And as frustrating as the waiting has been, I felt it was improper to come to you with sketchy reports, or possibly even erroneous statements, which would then have to be corrected, creating even more doubt and confusion. There's been enough of that.
    • I've paid a price for my silence in terms of your trust and confidence. But I've had to wait, as you have, for the complete story. That's why I appointed Ambassador David Abshire as my special counselor to help get out the thousands of documents to the various investigations. And I appointed a special review board, the Tower board, which took on the chore of pulling the truth together for me and getting to the bottom of things. It has now issued its findings.
    • I'm often accused of being an optimist, and it's true I had to hunt pretty hard to find any good news in the Board's report. As you know, it's well-stocked with criticisms, which I'll discuss in a moment; but I was very relieved to read this sentence: "... the Board is convinced that the President does indeed want the full story to be told." And that will continue to be my pledge to you as the other investigations go forward.
    • I want to thank the members of the panel: former Senator John Tower, former Secretary of State Edmund Muskie, and former national security adviser Brent Scowcroft. They have done the Nation, as well as me personally, a great service by submitting a report of such integrity and depth. They have my genuine and enduring gratitude.
    • I've studied the Board's report. Its findings are honest, convincing, and highly critical; and I accept them. And tonight I want to share with you my thoughts on these findings and report to you on the actions I'm taking to implement the Board's recommendations.
    • First, let me say I take full responsibility for my own actions and for those of my administration. As angry as I may be about activities undertaken without my knowledge, I am still accountable for those activities. As disappointed as I may be in some who served me, I'm still the one who must answer to the American people for this behavior. And as personally distasteful as I find secret bank accounts and diverted funds - well, as the Navy would say, this happened on my watch.
    • Let's start with the part that is the most controversial. A few months ago I told the American people I did not trade arms for hostages. My heart and my best intentions still tell me that's true, but the facts and the evidence tell me it is not As the Tower board reported, what began as a strategic opening to Iran deteriorated, in its implementation, into trading arms for hostages. This runs counter to my own beliefs, to administration policy, and to the original strategy we had in mind. There are reasons why it happened, but no excuses. It was a mistake.
    • I undertook the original Iran initiative in order to develop relations with those who might assume leadership in a post-Khomeini government. It's clear from the Board's report, however, that I let my personal concern for the hostages spill over into the geo- political strategy of reaching out to Iran. I asked so many questions about the hostages' welfare that I didn't ask enough about the specifics of the total Iran plan.
    • Let me say to the hostage families: We have not given up. We never will. And I promise you we'll use every legitimate means to free your loved ones from captivity. But I must also caution that those Americans who freely remain in such dangerous areas must know that they're responsible for their own safety.
    • Now, another major aspect of the Board's findings regards the transfer of funds to the Nicaraguan contras. The Tower board wasn't able to find out what happened to this money, so the facts here will be left to the continuing investigations of the court-appointed Independent Counsel and the two congressional investigating committees. I'm confident the truth will come out about this matter, as well. As I told the Tower board, I didn't know about any diversion of funds to the contras. But as President, I cannot escape responsibility.
    • Much has been said about my management style, a style that's worked successfully for me during 8 years as Governor of California and for most of my Presidency. The way I work is to identify the problem, find the right individuals to do the job, and then let them go to it. I've found this invariably brings out the best in people. They seem to rise to their full capability, and in the long run you get more done.
    • When it came to managing the NSC staff, let's face it, my style didn't match its previous track record. I've already begun correcting this. As a start, yesterday I met with the entire professional staff of the National Security Council. I defined for them the values I want to guide the national security policies of this country. I told them that I wanted a policy that was as justifiable and understandable in public as it was in secret. I wanted a policy that reflected the will of the Congress as well as of the White House. And I told them that there'll be no more freelancing by individuals when it comes to our national security.
    • You've heard a lot about the staff of the National Security Council in recent months. Well, I can tell you, they are good and dedicated government employees, who put in long hours for the Nation's benefit. They are eager and anxious to serve their country.
    • One thing still upsetting me, however, is that no one kept proper records of meetings or decisions. This led to my failure to recollect whether I approved an arms shipment before or after the fact. I did approve it; I just can't say specifically when. Well, rest assured, there's plenty of recordkeeping now going on at 1600 Pennsylvania Avenue.
    • For nearly a week now, I've been studying the Board's report I want the American people to know that this wrenching ordeal of recent months has not been in vain. I endorse every one of the Tower board's recommendations. In fact, I'm going beyond its recommendations so as to put the house in even better order.
    • I'm taking action in three basic areas: personnel, national security policy, and the process for making sure that the system works. First, personnel - I've brought in an accomplished and highly respected new team here at the White House. They bring new blood, new energy, and new credibility and experience.
    • Former Senator Howard Baker, my new Chief of Staff, possesses a breadth of legislative and foreign affairs skills that's impossible to match. I'm hopeful that his experience as minority and majority leader of the Senate can help us forge a new partnership with the Congress, especially on foreign and national security policies. I'm genuinely honored that he's given up his own Presidential aspirations to serve the country as my Chief of Staff.
    • Frank Carlucci, my new national security adviser, is respected for his experience in government and trusted for his judgment and counsel. Under him, the NSC staff is being rebuilt with proper management discipline. Already, almost half the NSC professional staff is comprised of new people.
    • Yesterday I nominated William Webster, a man of sterling reputation, to be Director of the Central Intelligence Agency. Mr. Webster has served as Director of the FBI and as a U.S. District Court judge. He understands the meaning of "rule of law."
    • So that his knowledge of national security matters can be available to me on a continuing basis, I will also appoint John Tower to serve as a member of my Foreign Intelligence Advisory Board. I am considering other changes in personnel, and I'll move more furniture, as I see fit, in the weeks and months ahead.
    • Second, in the area of national security policy, I have ordered the NSC to begin a comprehensive review of all covert operations. I have also directed that any covert activity be in support of clear policy objectives and in compliance with American values. I expect a covert policy that if Americans saw it on the front page of their newspaper, they'd say, "That makes sense." I have had issued a directive prohibiting the NSC staff itself from undertaking covert operations - no ifs, ands, or buts. I have asked Vice President Bush to reconvene his task force on terrorism to review our terrorist policy in light of the events that have occurred.
    • Third, in terms of the process of reaching national security decisions, I am adopting in total the Tower report's model of how the NSC process and staff should work. I am directing Mr. Carlucci to take the necessary steps to make that happen. He will report back to me on further reforms that might be needed. I've created the post of NSC legal adviser to assure a greater sensitivity to matters of law.
    • I am also determined to make the congressional oversight process work. Proper procedures for consultation with the Congress will be followed, not only in letter but in spirit Before the end of March, I will report to the Congress on all the steps I've taken in line with the Tower board's conclusions.
    • Now, what should happen when you make a mistake is this: You take your knocks, you learn your lessons, and then you move on. That's the healthiest way to deal with a problem. This in no way diminishes the importance of the other continuing investigations, but the business of our country and our people must proceed. I've gotten this message from Republicans and Democrats in Congress, from allies around the world, and - if we're reading the signals right - even from the Soviets. And of course, I've heard the message from you, the American people. You know, by the time you reach my age, you've made plenty of mistakes. And if you've lived your life properly - so, you learn. You put things in perspective. You pull your energies together. You change. You go forward.
    • My fellow Americans, I have a great deal that I want to accomplish with you and for you over the next 2 years. And the Lord willing, that's exactly what I intend to do.
    • Good night, and God bless you.

      Preliminary Statement of Former President Ronald W. Reagan

    • Portrait of Ronald W. Reagan President Reagan first learned in November of 1986 that proceeds from United States Government arms sales to Iran may have been diverted to assist the Nicaraguan resistance movement. He responded immediately by opening the records of his Administration to congressional investigators and to an independent investigating commission headed by former Senator John Tower. He waived of executive privilege and instructed his subordinates to cooperate fully with all investigations. He asked his Attorney General to seek the appointment of an independent counsel to investigate and, where appropriate, to prosecute any violations of criminal law arising from the events that became known as Iran-Contra.
    • Lawrence E. Walsh was appointed on December 19, 1986, to serve as Iran-Contra Independent Counsel. President Reagan cooperated fully with that investigation from its inception. He provided the Independent Counsel with unlimited access to the records of his Administration. He answered the Independent Counsel's questions under oath in writing and in person. He allowed the Independent Counsel access to all relevant portions of his diaries. He denied no information to the Independent Counsel. His cooperation has been both unlimited and unlimited and unstinting.
    • President Reagan has never publicly criticized any aspect of the investigation or conduct of Independent Counsel Walsh. He has refrained from any statement or conduct that might in any way be perceived as an impediment to the investigation. He declined requests to pardon individuals being investigated by the Independent Counsel. He did everything within his power to ensure that the Independent Counsel had the fullest authority and unfettered discretion to conduct his investigation.
    • The Independent Counsel has now completed his almost seven-year investigation, and it is now both appropriate and necessary for former President Reagan to respond. As many others have commented, and as his Final Report reveals, the Independent Counsel has permitted his investigation to become both excessive and vindictive. He has abused his authority. He has used his office to intimidate and harass individuals and otherwise to damage the lives of the persons he was given license to investigate. He and his Final Report have violated the policies of the Department of Justice that he was required by law to uphold, and he has disregarded the standards and ethics imposed uniformly on public prosecutors. His Final Report exceeds the authority given to him by law. He has used it to disseminate false and unfounded speculation, opinion and innuendo. His Final Report is not a chronicle of facts, but a prolonged justification of his own excessive investigation and a defamation of the individuals he was empowered to investigate.
    • Independent Counsel Walsh found no credible evidence of personal wrongdoing by President Reagan or violation by the former President of any criminal laws. See, e.g., Final Report of the Independent Counsel for Iran/Contra Matters, Vol. 1, at xiii (Aug. 4, 1993) ("[T]he investigation found no credible evidence that President Reagan violated any criminal statute.") (emphasis added) [hereinafter Final Report] . . . (the former President's conduct fell well short of criminality") (emphasis added). Yet in his Final Report the Independent Counsel attempts to indict President Reagan for alleged misconduct by others and to hint, without the benefit of any evidence, at wrongdoing by the former President himself.
    • The Independent Counsel's Final Report is the product of almost seven-year's work involving sixty-eight lawyers and hundreds of investigators. It is several hundred pages and several hundred-thousand words long. It is based upon years of secret grand jury interrogations to which only the Independent Counsel has had access. It is therefore impossible for anyone injured by the Report adequately to respond to it without comparable resources and access to the same materials. However, the following pages respond to the principal assertions and conclusions of the Independent Counsel. They demonstrate that, except for matters already considered by Congress and the courts, the Independent Counsel's speculation and conclusions regarding alleged misconduct by many individuals, including former President Reagan, are without foundation, and reflect, at best, a misunderstanding of the events he has investigated and a slanted and completely misleading rendition of them.

      Executive Summary: The Facts of Iran-Contra [according to the Reagan defense team]

    • The essential facts of Iran-Contra are as follows:
      1. In the summer of 1985, the Reagan Administration, at the urging and with the assistance of the Israeli government, determined to explore forming a relationship with moderates in the government of Iran who were preparing to seek power upon the death of Ayatollah Khomeini. The Iranians offered to demonstrate their "bona fides" by attempting to assist the United States in achieving the release of American hostages being held in Lebanon. To demonstrate the good faith of the United States in engaging in these discussions, the United States agreed to sell a limited amount of arms to these moderate an government officials. President Reagan was informed of and approved the initiative, which at first involved Israel's shipment of U.S.-made TOW and HAWK missiles to Iran, and, subsequently involved direct shipments of a limited amount of arms to Iran by the United States. Three hostages were released during the eighteen-month Iran initiative, which was first publicly reported on November 3, 1986, and terminated shortly thereafter.
      2. Beginning in 1983, Congress sought to impose a series of legal restrictions on the use of certain appropriated funds by the Reagan Administration to support the Nicaraguan Democratic Resistance, or "Contras," in their efforts to resist the excesses and expansionism of the communist "Sandinistas," who had seized control of the Nicaraguan government in 1979. Congress enacted and subsequently repeatedly amended appropriations riders, the so-called Boland Amendments, to restrict certain Executive Branch agencies from providing certain types of aid to the Contras. President Reagan acted in compliance with the Boland Amendments and directed his subordinates to do so as well.
      3. In connection with a preliminary investigation of the Iranian arms sales directed by Attorney General Edwin Meese III over the weekend of November 21–23, 1986, the Attorney General's staff discovered a memorandum in the files of Lt. Col. Oliver L. North indicating that funds from the Iranian arms transactions may have been diverted to support the Contras. President Reagan was first informed on November 24, 1986, that a diversion may have occurred, and on November 25, 1986, the President and the Attorney General held a press conference to disclose the discovery of the possible diversion of funds. President Reagan moved immediately thereafter to assist congressional investigations of these events, authorized the creation of an independent Executive Branch investigation and urged the appointment of an independent counsel by the Judiciary to conduct a third investigation. He opened the records of his Administration to these three separate independent investigations.

      Response of Former President Reagan to the Independent Counsel's Final Report

    • The Response of former President Reagan to the Final Report demonstrates the following:
      1. The Iran-Contra Independent Counsel has misused and abused the reporting process that is mandated by the independent counsel statute. The Final Report unfairly and unnecessarily injures the rights and reputations of individuals, relies on innuendo, speculation and conjecture instead of proof, violates established standards governing the conduct of prosecutors, and improperly relies on secret grand jury materials to support the Independent Counsel's many accusations.
      2. The Independent Counsel's principal accusation in his Final Report is that officials at the highest levels of the Reagan Administration engaged in a "cover-up" designed to conceal the fact that President Reagan had contemporaneous knowledge of the 1985 arms shipments. There was, however, no "cover-up." To the contrary, President Reagan repeatedly insisted, both publicly and privately, that the complete facts of Iran-Contra be publicly aired and that his Administration cooperate fully with investigators. Moreover, the evidence is overwhelming that the essential facts of the an initiative were readily and repeatedly disclosed by President Reagan and his top advisers. The contemporaneous notes of participants in the meetings referred to by the Independent Counsel independently refute the notion of a cover-up and demonstrate that the Independent Counsel has falsely depicted the events that he purports to describe. In fact, President Reagan's knowledge of the 1985 arms transactions supports, not undermines, the legality of those transactions.
      3. The Independent Counsel's contention that President Reagan and his senior advisers and Cabinet officials participated in a strategy to make National Security Council ("NSC") staff member Lt. Col. North, and National Security Advisers Robert C. McFarlane and John M. Poindexter "scapegoats" with respect to Iran-Contra is demonstrably false. President Reagan took full responsibility for the an initiative from the outset. He also accepted responsibility for all actions within the scope of his instructions taken by his subordinates in support of the Contras. But he was not aware of and could not responsibly be blamed for the diversion of funds to the Contras, the destruction of records by individuals acting contrary to his instructions or other conduct that was not authorized or sanctioned. The "scapegoat" theory of the Independent Counsel has been advanced and repeatedly rejected since the first public revelation of Iran-contra, and was rejected by the Independent Counsel himself in the cases that he prosecuted. His Final Report adds nothing to the record except his own, internally inconsistent, personal theory.
      4. The Independent Counsel repeatedly seeks to convey the impression that high-ranking Reagan Administration officials, including the President, violated civil laws and Executive Orders in carrying out the Iranian initiative, particularly with regard to the 1985 arms shipments. But there is, in fact, strong authority supporting the legality of the Iranian arms shipments. The President had the power and responsibility to take certain measures to advance U.S. policies and interests and the constitutional discretion to protect the lives and liberty of Americans in foreign countries. The President properly relied on legal experts to ensure that his actions were lawful, as the Independent Counsel grudgingly acknowledges. The Iranian initiative was consistent with other applicable laws, and the Independent Counsel has provided no reasoned legal analysis to the contrary.
      5. Although the Independent Counsel concedes that there is "no credible evidence that the President authorized or was aware of the diversion of profits from the Iran arms sales to assist the contras," Final Report, Vol. 1, at 443 (emphasis added), his Final Report indulges in the irresponsible speculation that the President must have known about the diversion. However, that speculation has no evidentiary support whatsoever, and is directly contradicted by the findings of the Tower Commission and the Congressional Committees that investigated Iran-Contra. President Reagan has consistently, unequivocally and categorically stated that he had no knowledge of the diversion, and every bit of credible evidence in the record—including the voluminous record compiled by Independent Counsel Walsh—is consistent with the President's clear and unwavering position on this point. The Independent Counsel's Report adds nothing new beyond his capricious speculation.
      6. The Independent Counsel asserts that President Reagan is responsible for "set[ting] the stage" for alleged violations of the law by his subordinates by expressing his continuing Public support for the Contras. . . . However, President Reagan gave repeated instructions to members of his Administration to follow the law and abide by the Boland restrictions. The activities authorized by President Reagan complied with the Boland Amendments and all other laws of the United States. The Independent Counsel has been unable to establish that any conduct by the President the various vague appropriations riders referred to as the Boland Amendments.

    • Source: Final Report of the Independent Counsel for Iran/Contra Matters, Vol. III: Comments and Materials Submitted by Individuals and Their Attorneys Responding to Volume I of the Final Report, December 3, 1993 (Washington, D.C.: U.S. Government Printing Office, 1993), 21–35, 639–646. References to attachments in George Bush's statement have been omitted.