NEW YORK CITY — Roy M. Furmark, the New York businessman who testified last week before the Senate Intelligence Committee, said Tuesday that he met CIA Director William J. Casey three times in October and November to warn him of financial irregularities in the secret U.S. arms sales to Iran.
In an interview with The Times, Furmark said that he told Casey on their third meeting, on Nov. 24, that up to $15 million may have been diverted to the Nicaraguan contras from the arms sales.
Furmark said he told Casey at their first meeting, on Oct. 7, that $15 million had been deposited in a Swiss bank account of Lake Resources Inc., a front company later discovered to have been controlled by Lt. Col. Oliver L. North of the National Security Council staff.
Furmark said he was the one who first brought together the two key middlemen in the arms deal by introducing Saudi Arabian arms dealer Adnan Khashoggi to Manucher Ghorbanifar, an Iranian businessman, at a Persian rug auction in Hamburg, Germany, in June, 1985. The two men have acknowledged arranging four arms sales to Iran.
"In my last meeting, (with Casey) I told him that Ghorbanifar thinks some of the money may have gone to the contras," Furmark said. He said he told Casey: "It looks like $15 million is missing."
That meeting, according to Furmark's account, occurred only the day before President Reagan and U.S. Atty. Gen. Edwin Meese III appeared at a White House press conference, at which Meese disclosed that $10 million to $30 million had apparently been diverted to the contras from the secret U.S. arms sales to Iran.
Furmark, a 55-year-old New York-based energy consultant, thus played a larger role than previously recognized in both the early and late stages of the controversial U.S. operation to sell arms to Ayatollah Ruhollah Khomeini's regime.
New Light on Arms Deals
His account sheds new light on four of the arms transfers, valued at $30 million, and how much Casey and other officials might have known of the operation.
Casey, who remains hospitalized after suffering two mild cerebral seizures Monday, has publicly acknowledged talking with Furmark only once, on Oct. 7, about the arms deal.
But Furmark said he briefed Casey alone three times--at the CIA office near the White House on Oct. 7, on a government plane to New York together with Casey's wife, Sophia, on Oct. 16, and at CIA headquarters in Langley, Va., on Nov. 24. He said he also met Casey's staff investigators twice after Nov. 16 in Washington and once in New York over dinner at the Christ Cella Restaurant, an expensive mid-Manhattan steak house.
Casey testified in a closed session of the House Foreign Affairs Committee last Wednesday. He later told reporters that Furmark's October account provided only a "whiff" that money had been diverted to the contras, and prompted him to "start asking some questions."
Furmark, who said he is a consultant to Khashoggi, said the Saudi Arabian financier had asked him in late September to speak to Casey because Furmark had known Casey for more than a decade.
When asked about his knowledge of the arms deals, Furmark said, "I knew what was going on in a general sense" from previous conversations with Khashoggi. But he said Khashoggi didn't brief him fully until a meeting in New York in late September.
"He told me he was trying to help the U.S. government," Furmark said. "I think it was to open up channels of communication."
Arms Deal Financing
Furmark said he told Casey that Khashoggi had arranged the financing of two arms shipments from Israel to Iran in August and September of 1985 for $1 million and $4 million. He said Khashoggi had then arranged a third shipment in February, 1986, for $10 million.
He said it was a fourth transaction, involving $15 million in May, 1986, that led to problems. Furmark said two Canadian investors, Walter E. Miller and Donald Fraser, had provided $10 million in "bridge financing" to Khashoggi for the deal. The Canadians have had extensive business dealings with Khashoggi in Vancouver, Salt Lake City and the Cayman Islands.
Furmark said unidentified "European and Middle East sources" had provided the money for the $4-million transaction, the $10-million transaction and $5 million of the $15-million transaction.
"Mr. Khashoggi knows the true source of the money used here, and I think only he knows," Furmark said.
Furmark said he once shook hands in a Paris hotel lobby with Miller, a hotel owner and real estate developer. He said he never met Fraser.
Investors Left With Debt
Furmark said that two "partial shipments" of arms were delivered in July and August, 1986, but the Iranians paid only $8 million of the $15-million deal. Adding $3 million for handling and shipping, that left Khashoggi, the Canadians and the other investors $10 million in debt, Furmark said.