WHITE HOUSE KNEW OF A SHIFT ON IRAN C.I.A. OFFICIALS SAY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00965R000302430005-8
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 27, 2016
• Document Release Date: November 21, 2012
• Sequence Number: 5
• Publication Date: March 20, 1987
• Content Type: OPEN SOURCE

_3 Declassified in Part - Sanitized Copy Approved for Release 2012/11/21: CIA-RDP90-00965R000302430005-8
ON PAGE NEW YORK TIMES
20 March 1987
WHITE HOUSE KNEW
OF A SHIFT ON IRAN,
C.I.A. OFFICIALS SAY
t.7- By MICHAEL It. GORDON
special tome New York limes
WASHINGTON, March 19 ? Senior
Central Intelligence Agency officials
say they repeatedly gave the White
1 House intelligence reports in the fall of
1985 that indicated little prospect for
?
improving United States relations with
Iran, even as the Reagan Administra-
tion began a covert initiative to accom-
plish that purpose. /9
The C.I.A. officials said they also re-
peatedly advised the White House at
that time that there was no imminent
threat that the Soviet Union would gain
significant influence in Iran.
Nonetheless, the Reagan White
House proceeded with clandestine
arms sales to Iran and even composed
an intelligence finding in January 1986
that cited the possibility of growing
Soviet influence in the Persian Gulf re-
gion as a major rationale for the Iran
arms sale initiative.
Estimate Is Reversed
The senior officials agreed to rare
on-the-record interviews on Wednes-
day to counter charges that Govern-
ment intelligence reports had exagger-
ated accounts of internal instability in
Iran and the purported Soviet threat to
lend support to President Reagan's
Iran initiative.
But they acknowledged that the intel-
ligence assessments on Iran in the fall
of 1985 represented a reversal of an
estimate the previous spring that the
political situation in Teheran was de-
teriorating and that the Soviet threat
was serious.
The report by the Tower Commission
on the Iran-contra affair, issued Feb. '
26, said that Graham Fuller, then the
national intelligence officer for the
Middle East, and Howard Teicket. then
director of political-military affa,rs at
the National Security Council, wcrked
together on a key intelligence assess-
ment that laid the basis for the Reagan
Administration's Iran initiative. Some
members of the commission have pri-
vately said they suspect that the intelli-
pace reports were tailored specifi-
cally to support policy goals.
--Mr. Fuller, 49 years old, who is retir-
ing from the agency at the end of the
year, prepared a "think piece" for Wil-
liam J. Casey, the Director of Central
Intelligence, in May 1985 stressing that
the Soviet Union was in a far better
position to exert influence in Iran and
stating that the regime of Ayatollah
Ruhollah Khomeini was -faltering." In
his memorandum, Mr. Fuller sug-
gested that Western nations be allowed
to sell arms to Iran so the West could
gain influence in Teheran.
Those conclusions were also stated in
the Government-wide intelligence as-
sessment cited by the Tower Commis-
sion and overseen by Mr. Fuller, which
was also prepared in May 1985 at the
request of the National Security Coun-
cil.
jj..,Ker_r.,_the Deputy Director
forThitelligence at the C.I.A., said that
assertions in that assessment about the
Soviet threat to Iran were a matter of
contention within the intelligence com-
munity and that he is now "fairly criti-
cal" of its conclusions.
'Situation Had Stabilized'
The IWO senior officials said that
they and other experts concluded sev-
eral months after the May 1985 assess-
ment that the Iranian regime was not
as unstable as the initial intelligence
forecasts had suggested and that the
Soviet Union had not attempted to ex-
ploit opportunities for gaining influ-
ence.
Mr. Fuller said, "Within a matter of
four to five months, I came to a conclu-
sion that the trends we had identified
as active in May had not continued to
develop in that direction."
He said he prepared a written analy-
sis of his new views, but did not distrib-
ute it throughout the Government, as
he did his "think piece." He said he told
officials throughout the Government of
the new assessment.
"The internal situation had stabil-
ized and the Soviets were not following
up as they could have,'' Mr. Fuller said.
Mr. Kerr asserted that the "trend"
of intelligence reports in the summer
and the fall was going against the May
assessment. "The inteiligence was run-
ning in the other direction," he said. "It
I certainly was not pointing to openings
I in Iran with 'moderates.' "
The C.I.A. officials interviewed said
that they did not know of the covert
shipment of arms and that other ana-
lysts who worked on the intelligence re-
ports also did not know of the ship-
ments.
Assessment Loses Force
In light of the Reagan Administra-
tion's public disclosures since Novem-
oer on the evolution of the Iran-contra
affair this turned out to be precisely
the period in which President Reagan's
closest national security advisers were
beginning what shortly became the
clandestine initiative to sell arms to
, Iran.
One knowledgeable official said that
after the summer of 1985 the Adminis-
tration became precoccupied with ex-
changing arms for American hostages
and that the intelligence assessment
about Iran and the Soviet Union be-
came less relevant to the White House.
He said he did not know if White
House officials conveyed to President
Reagan the new reports, which were
formally codified in an intelligence
estimate in 1986. Despite the new intel-
ligence estimate, the Administration
continued its covert negotiations with
Iran over hostages.
`Pertinent' Intelligence Is Aim
Criticizing the Tower commission's
implication that Mr. Fuller and Mr.
Teicher worked together to produce an
intelligence estimate that supported
the new Administration policy that was
under consideration, Mr. Fuller denied
that he had tailored his assessments to
support policy.
"They are suggesting a coziness, an
irregularity of relationship, that is far
from the truth," he said.
Mr. Fuller asserted such close col-
laboration was needed so that the ana-
lysts would provide "pertinent" intelli-
gence. Mr. Fuller now serves as the
vice-chairman of the National Intelli-
gence Council, which oversees the
preparation of intelligence assess-
ments. He said that he plans to retire
from the Government in December
' and take a position with a policy study
institute.
Declassified in Part - Sanitized Copy Approved for Release 2012/11/21: CIA-RDP90-00965R000302430005-8
Declassified in Part - Sanitized Copy Approved for Release 2012/11/21: CIA-RDP90-00965R000302430005-8
Messages from North found by
commission investigators in the
NSC's computer system show that
at one point North was negotiating
with the CIA to persuade it to
purchase $4.5 million in "assets"
he had accumulated in helping the
contras during the congressional
prohibition.
The messages suggest that CIA
officials, including Casey, were
aware of the secret system and
that the CIA appeared interested
in a deal since Congress was about
to allow the CIA to resume
management of the contra aid
program.
$4.5 million is assets
"We are rapidly approaching the
point where the Project Democra-
cy assets in CentAm need to be
turned over to CIA," North wrote
to Poindexter in July 1986.
"The total value of the assets
(six aircraft, warehouses, supplies,
maintenance facilities, ships,
boats, leased houses, vehicles,
ordnance, munitions, communica-
tions equipment and a 6,520 !foot)
runway on property owned by a
PRODEM [Project Democracy!
proprietary) is over $4.5 M.
"You should be aware that CIA
has already approached PRO-
DEM's chief pilot to ask him
where they [CIA] can purchase
more of the C-1351< ... The chief
pilot told them where they can get
them commercially from the
USAF as excess ? the same way
PRODEM bought them under pro-
prietary arrangements."
Poindexter replied: "I did tell
Gates that I thought the private
effort should be phased out. Please
talk to Casey about this. I agree
with you."
The chief of the CIA Central
American Task Force told the
board that after Congress cut ott
contra aid in October 1984, "it
was 011ie North who then moved
into that void and was the focal
point for the administration on
Central American policy until fall
1985."
A CIA officer who worked
closely with North in directing air
drops from Costa Rica last year
told the panel that the contra
supply network was "controlled
by Lt. Col. North."
Abrams said he and Hill, the
Shultz aide, discussed what to do
with a $10 million contribution for
the contras from Brunei in 1986
and decided to have Brunei deposit
it in a North account in Switzer-
land.
The day Hasenfus' plane was
shot down over Nicaragua, other
NSC staffers dealt with the matter
because North had left for Frank-
furt, West Germany, on an Iran.
related mission, but they also
revealed some knowledge of what
was involved.
Robert Earl. North's immediate
supervisor, sent the following note
to Poindexter Oct. 5: "One of the
Democracy Inc. aircraft apparent-
ly went down on a resupply
mission to FDN forces in the
north."
In the end, the Tower inquiry
report concluded that while North
worked largely in isolation be-
cause his superiors rarely, if ever,
reviewed his work, it was a
different story on his contra
supply network. He constantly
advised his superiors. McFarlane
and Poindexter, of his plans and
actions.
And while everybody else
seemed to know what North was
up to, the president was the only
one kept in the dark, the report
suggests.
Declassified in Part - Sanitized Copy Approved for Release 2012/11/21: CIA-RDP90-00965R000302430005-8