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Plan to Sell Iran U.S. Arms in '87 Told by Secord

May 08, 1987|DOYLE McMANUS | Times Staff Writer

WASHINGTON — White House aide Oliver L. North and retired Maj. Gen. Richard V. Secord expected to continue selling U.S. weapons to Iran during 1987, but their plans were "aborted" when the secret arms deals became public last year, Secord told Congress Thursday.

Secord was even negotiating to buy his own Boeing 707 cargo jet for about $1.5 million to carry the anticipated shipments to Tehran, he told the House and Senate committees investigating the Iran- contra scandal.

"We were still planning future operations," Secord said in response to questions about why his Swiss company, Lake Resources Inc., still had more than $8 million in various bank accounts.

'Operation Blown Apart'

"I didn't terminate this operation," he said. "The operation was blown apart. The operation was aborted.

"In fact, we were talking to (an Iranian intermediary) about buying an airplane," he said. "We contacted Southern Air Transport to start a search for a 707. They found one. And we were proceeding with the plans to buy that aircraft."

Southern Air, a Miami-based cargo airline that was once secretly owned by the CIA, provided Secord with many of the planes he used to shuttle weapons to both Iran and the Nicaraguan rebels.

"The asking price was about $2 million," he said. "We hoped we could negotiate it down to $1.5 (million) or so."

In three days of testimony, Secord and congressional investigators have revealed a host of other new details about his two secret airlift operations. Among them:

--Beer magnate Joseph Coors donated $65,000 to Lake Resources to buy a light cargo plane for Nicaragua's rebels. Financial manager Albert A. Hakim told congressional investigators that a bank order from Coors and his wife, Holly, was deposited in Lake's Swiss account on Aug. 21, 1985, and Senate counsel Arthur L. Liman said Thursday that the money was used to buy a light plane known as a Maule.

Secord told the committee that he did not know the source of the money; Coors refused to comment.

--Investigators believe that a Secord aide attempted to bribe Portuguese officials to release an Israeli shipment of Hawk anti-aircraft missiles so the cargo could be flown to Iran. The cargo of missiles, one of the first U.S.-sanctioned arms shipments, was being held at Lisbon airport in November, 1985, when North asked Secord to help win its release.

Portugal Payments Alleged

Sen. David L. Boren (D-Okla.), chairman of the Senate Intelligence Committee, said Thursday that documents suggest Secord associates "made some payments to people in Portugal to get these shipments out . . . Portuguese officials, either running airports or customs." Secord, who has testified that he asked former CIA officer Thomas Clines to help release the shipments, said he knew of no such payments.

--The arms were eventually delivered to Iran by St. Lucia Airways, a CIA-owned cargo carrier, according to Hakim. In his deposition before congressional investigators last month, Hakim said that Lake Resources paid $127,700 to St. Lucia, "which I now believe to be a CIA proprietary company that was chartered in November, 1985, to deliver Hawks to Iran." St. Lucia has also carried CIA cargoes to Angola, Zaire and Israel, according to published reports.

--Secord's men in Central America mounted a 7.62-millimeter machine gun on the tail of one of their cargo planes last year, apparently to fight off Sandinista air attacks. In a coded message to North last September, retired Col. Robert C. Dutton told him of the machine gun and said: "Bring on (the) Mi-24." That was a reference to the Sandinista regime's Soviet-supplied Mi-24 attack helicopters--and a bit of bravado, since the Mi-24 is armed with missiles as well as machine guns.

--Dutton complained that the contra airlift produced a profit margin of at least 58% for Richard B. Gadd, who ran the Central American operation for Secord until mid-1986. In a June, 1986, memorandum, Dutton told Secord that Gadd was billing Lake Resources for operating and maintenance costs of $50,000 to $100,000 per month. "Since we are already paying all of the operating and maintenance costs, (this) amounts to an additional profit payment," Dutton wrote. Gadd could not be reached for comment.

Handled $48 Million

--The Lake Resources account handled almost $48 million in all from late 1984 until last October, according to bank records given to Congress by Hakim. In addition to millions of dollars received from Iranian middlemen for the purchase of U.S. arms, Lake's account also received some $10 million from the contras to buy weapons for them; and $1.6 million from International Business Communications and an affiliate known only as I.C. The two firms handled money contributed to the contra cause by private U.S. citizens. IBC's president, Richard R. Miller, pleaded guilty Wednesday to conspiracy to use a tax-exempt foundation for non-exempt purposes.

--Lake's expenditures, according to Hakim, included $12.2 million to a secret CIA account in Geneva, to pay for weapons sold to Iran; $11.2 million to Defex, a Portuguese arms company used to buy arms for the contras; $1.6 million to TransWorld Arms Ltd., a Canadian arms company that also sold weapons for the contras; $3.3 million to Southern Air Transport; $1.5 million to Gadd's airlift operating firm; $200,000 to the Nicaraguan Democratic Force, the largest contra army, and $59,500 to contra leader Arturo Cruz, who has acknowledged receiving $7,000 a month through North for personal and political expenses.

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