COPENHAGEN — The latest autopsy of the Iran- contra scandal, issued Thursday by the Tower Commission, revives two basic questions that had been all but forgotten in the dash to nab the villains of the affair: What did former White House aide Lt. Col. Oliver L. North do with the millions he hid in Swiss banks? And how did he do it?
The full answers may not be known for years. But a swatch of the scandal now unraveling in Denmark suggests that a good deal of the money--perhaps $3 million or more--was plowed into the misadventures of a peeling, blue-and-white 163-foot coastal steamer called the Erria.
How that was done is undisputed among observers: very sloppily.
"The whole operation was done by amateurs," one European figure in the scandal scoffed last week. "This was no exception."
The Erria, a Danish-flag freighter that North and two key associates bought last April and put to sea for eight months of derring-do, makes that point. It offers an intriguing and sometimes comical glimpse of how North and his associates tried to cloak the Iran-contra operation in secrecy.
With help from the Tower report, the history of the Erria reveals how North and two associates--retired Air Force Maj. Gen. Richard V. Secord and Iranian-born California businessman Albert A. Hakim--ran the ship and other parts of the Iran-contra operation like a multinational holding company, right down to the flow charts and balance sheets.
And it hints at how North, William J. Casey, former director of the CIA, and other Administration officials could have allowed private friendships and business relationships to become entwined with their efforts on behalf of the contras.
The unlikely missions of the small ship--gunrunning, attempted ransoms, espionage--have been detailed in recent weeks. Less known, however, is the network that stood behind them: at least three Panamanian shell companies, a CIA front, a former CIA official, Swiss accountants and a lawyer, an unknown number of bank accounts and an otherwise legitimate Danish company that served as a front for the whole adventure.
Links to Swiss Accounts
Much, if not all, of the $3-million price tag may have been paid from accounts now frozen by the Swiss government at the request of the U.S. Justice Department, which is probing the Iran scandal. The full story cannot be assembled until the Swiss open the accounts to U.S. investigators, which can only occur after a proceeding in which Swiss officials hear the objections of account holders to any release of information.
It is known that one account, that of the Panamanian dummy firm Lake Resources Inc., was a major repository for cash from the Iran arms deal, a $10-million donation to the contras from the Sultan of Brunei, and other North sidelines.
The Erria's purchase price was 2 1/2 million kroner, or $312,500, at the time that Danish sea captain Arne Herup sold it on April 28 of last year, according to Herup's agents.
Between that time and the Erria's last port of call in January is a half-covered trail of bank transfers, legal grants and actions that hint at how North & Co. manipulated their shell businesses and operatives without exposing their own role in the operations.
At the start are two firms that figure in virtually every aspect of the Iran-contra affair: Compagnie de Services Fiduciaires, of Geneva, and Quijano & Associates, a law firm in Panama City. Although neither had any active role in North's missions, they worked hand-in-hand to provide the covers that made possible the secrecy that was deemed so essential to his work.
CSF is a fiduciary firm. It provided mailboxes and Swiss bank accounts to a number of firms tied to the Iran dealings and the contra aid pipeline. Its ties go back at least a decade to Stanford Technology Corp., a Hakim-owned firm that later took on Secord as a director and its chief deal maker.
Quijano, often with CSF's help, provided officers and addresses for shell companies in Panama. One of these was Lake Resources, a Panama firm with Swiss addresses and officers. Another was Dolmy Business Inc., a Panama company set up for North, Secord and Hakim but staffed exclusively with officers from Quijano and CSF.
Newly released documents from the Tower panel suggest that both firms were set up by North as anonymous "collectors" of money for funneling to other companies or people. Lake Resources played the role admirably, serving as the conduit for arms sales to Iran and for the apparent later diversion of money to other projects.
Whether Dolmy ever did the same is not known, but CSF did use the company last April to buy a ship for North. In one indication of how North's network could work in darkness, sources say CSF manager Willard I. Zucker, an ex-Internal Revenue Service lawyer now living in Switzerland, traveled to Denmark with Hakim for the Erria's purchase last April.
Given Power of Attorney