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Gave North $90,000, Contra Leader Says : Part Was to Be Used to Ransom Lebanon Hostages, Calero Testifies

May 21, 1987|SARA FRITZ and KAREN TUMULTY | Times Staff Writers

WASHINGTON — Nicaraguan resistance leader Adolfo Calero told Senate and House committees Wednesday that he gave $90,000 in unsigned traveler's checks to former White House aide Oliver L. North in 1985--money that congressional investigators say is still largely unaccounted for.

The money was just a fraction of the $33.6 million that Calero received from a variety of sources--primarily King Fahd of Saudi Arabia and private U.S. donors--between 1984 and 1986, when direct military aid from the U.S. government was prohibited by Congress. North had played a major role in raising the funds.

Three wealthy American contributors--Colorado brewer Joseph Coors, Ellen St. John Garwood of Texas and William O'Boyle of New York--will appear before the committee today, along with retired Army Maj. Gen. John K. Singlaub, who testified Wednesday that his attempts to supply Calero with cheap weapons were undermined by higher-priced vendors such as North's associate, retired Air Force Maj. Gen. Richard V. Secord.

Singlaub said also that his solicitation of contra donations from two countries--Taiwan and South Korea--was curtailed in May, 1986, at the request of Assistant Secretary of State Elliott Abrams, who told him that it was being handled "at the highest levels" of the U.S. government. Taiwan's $2-million contribution went to Secord, not directly to Calero.

Calero testified that North had requested money in 1985 for two purposes: to finance the work of other contra leaders and to help fund a so-called "private effort" that North was directing to pay ransom for the release of American hostages in Lebanon. He said he responded gladly by giving North about $90,000 in unsigned traveler's checks drawn on his bank in the Cayman Islands.

"I reacted immediately, saying that Nicaraguan hostages of the Sandinistas (and) American hostages of these groups in Lebanon were one and the same and that I would be happy to help in their liberation," he said. "I felt deeply for those poor people who had been kidnaped."

Calero said he is certain that North, who was fired from the White House last November, never made personal use of any of the money, even though much of it has not yet been traced and some apparently was spent by North for personal goods such as groceries.

Check Cashing Detailed

The Times reported Wednesday that the congressional committees have found that North cashed $2,440 of Calero's checks himself--$340 in food stores, $220 in other retail shops and $1,180 for what appear to be travel-related expenses between April and December, 1985. One $20 check was cashed at a women's hosiery shop; a $100 check was spent for snow tires.

"When was the last time it snowed in Nicaragua?" Sen. Warren B. Rudman (R-N.H.) asked, noting that the money had been donated to help the contras.

Calero replied: "It does not snow in Nicaragua. However, I am sure there's an explanation for that . . . . I have full confidence that whatever he did was for the cause."

North has consistently been portrayed by his associates as a selfless patriot who acted solely out of loyalty to the policies of President Reagan. Although Calero said nothing to alter that image, his testimony is expected to heighten pressure already being exerted on North to testify voluntarily, without demanding immunity from prosecution.

Arthur L. Liman, counsel for the Senate committee investigating the Iran-contra affair, said that investigators so far have been unable to verify how most of the $90,000 was spent, although they recently obtained the canceled traveler's checks from Calero's bank.

Although the committee has heard testimony that $50,000 of Calero's money was spent on the hostage ransom attempt, Liman said that only half of the amount has been traced to that purpose. He said $25,000 of the checks were cashed by Drug Enforcement Administration agents who were recruited to help North in the ransom operation.

$1,000 Wedding Gift

Robert W. Owen, who acted as North's liaison with the contra leadership, has testified that he cashed about $30,000 of the contra traveler's checks for North and distributed the money to more than six other contra leaders. Owen said also that North, who kept the checks in his White House office safe, gave him $1,000 of the funds as a wedding gift.

Calero testified that he had not been asked by North to approve the expenditure of $1,000 for Owen's wedding gift, nor was he told explicitly by North that the remainder of the funds was going to other rebel leaders. But he said: "I sort of imagined it."

He added: "At one point, we discussed my passing money to other leaders of other factions of the resistance, and we came to the conclusion that it was not politically sound to do that; and, at a later meeting, he told me that I would not have to do it, that another way had been found."

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