FIRST COVERT CONTRA PLAN HATCHED IN '83

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00965R000403270002-7
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 1
• Document Creation Date: December 22, 2016
• Document Release Date: February 9, 2012
• Sequence Number: 2
• Publication Date: January 3, 1987
• Content Type: OPEN SOURCE

ST.T
Declassified in Part - Sanitized Copy Approved for Release 2012/02/09: CIA-RDP90-00965R000403270002-7
ARTICLE APPEARED 3 January 1987
ON PAC _
First covert c in ontra Ian hatched
83
17-By Fred Kaplan were the officials who decided last year to d1-
Globe Staff vert Iranian arms money to the contras: the
W
WASHINGTON - The events leading to
the current arms scandal. in which funds
from weapons sold to Iran were diverted to
rebels in Central America. did not mark the
first time the Reagan administration fun-
neled military aid to the anti-Marxist rebels
against the wishes of Congress.
A similar. though less complicated.
scheme was engineered three years ago Just
as the Iranian arms deal of 1985-86 was
planned at a time when Congress had out-
lawed military assistance to the rebels trying
to overthrow the government of Nicaragua.
so. too. was this earlier episode hatched in
the face of legislative restrictions.
In 1983, Congress placed a $24 million
cap on aid to the Nicaraguan rebels. known
as contras. By the end of that year. the limit
had been hit but the administration wanted
to give more. Thus. the Central Intelligence
Agency coordinated a secret operation called
"Project Elephant Herd."
Under this operation, according to Inter-
nal Pentagon documents obtained by the
Globe. $12 million worth of military supplies
- including three Cessna 0-2 observation
planes, which could be converted to carry
rockets - were to be declared "surplus to re-
quirements" of the military. As such. they
would be valued as worthless.
They were then transferred to the con-
tras. and - since it had no dollar value - the
shipment did not technically violate the con-
gressional restriction,
The CIA had reportedly asked for $32 mil-
lion. but Pentagon officials - who called the
request "the Christmas list" - whittled it
down.
The operation did have a consequence.
though probably not what was intended. In
August 1984. the three planes carried out an
air assault on a Nicaraguan military school
near the Honduran border. and Nicaraguan
troops shot down an accompanying helicop-
ter in which two American advisers were
flying. killing both.
Within days, the orlalns of the three
planes and the existence of Project Elephant
Herd leaked out. Several legislators, most vo-
cally Sen. James Sasser (D-Tenn.), raised
concerns that the administration had delib-
erately circumvented the congressional re-
striction on contra aid and may have violat-
ed the Economy Act, which requires that fed-
eral agencies be fully reimbursed when their
resources are used for special operations.
This was especially so, because only a few
weeks earlier the United States had sold -
not given - the same types of planes to Hon-
duras, and because the Air National Guard
base at Stewart Airport in New York, from
which the three contra planes had been tak-
en, still held onto 13 of the supposedly "sur-
plus" aircraft.
It is not yet known how widely scatterers
hite House claims only Adm. John M.
Poindexter and Lt. Col. Oliver L. North. the
former national security adviser and one of
his deputy directors. respectively, knew am-
-thing about it.
However, Project Elephant Herd was an
operation executed through all the proper
channels.
It was initiated by the CIA. CBS News re-
ported recently that North "worked directly
with the CIA" on the project. Internal Penta-
gon documents indicate it was officially run
by the Joint Chiefs of Staff. Assigned the
project number STX-40-019, it was coordi-
nated by "AF'PRPRC," the "resources and
flying hours division" of the office of the dep-
uty Air Force chief of staff for pre 'rams and
resources.
This office Instructed the Air Force Logis-
tics Command in Fairborn. Ohio, to declare
the three airplanes "surplus" and to -Ar-
range movement of the aircraft."
The planes were declared "excess to 'Air
National Guard: requirements" in a memo-
randum dated Dec. 9. 1983. They were flown
to Andrews Air Force Base outside Washing-
ton, then to Summit Aviation c., a com-
pany in Middlitowri:el., which. according
to several press reports, has frequentl
modi-
y
fied airplanes, including Cessna O-2s. for
military purposes. The company has also re-
portedly done work for the CIA and has hired
former CIA officials.
At Summit, in February 1984, each plane
was fitted with four pods, capable of holding
28 rockets. From there, they were taken to
Central America and put into the hands of
contras.
Officials say Project Elephant Herd was
not a unique operation. They say congres-
sional restrictions on military aid - not just
to contras, but to many countries and rebel
groups - are frequently circumvented in this
way.
One former Pentagon official who was in-
volved in arms sales, who asked not to be.
identified and who is not critical of the prat
tice. says: "Look. the CIA doesn't stock any-.
thing. They have every right to come to -the
Department of- Defense to ask for our assts.
tance on a routine basis
Th
e business of declaring arms "surplus"
- so that they can be recorded in accounting
books as having no value and, therefore, can-
be exported without regard to congressional-
ly imposed ceilings - "is done all the time,"
the former official says.
"Congress may occasionally get angry
that Defense is imaginative," the official
continues. "They'd write a new law to try to
tie us down, and within five minutes some-
body would find a way to drive an elephant
through it. That's been going on forever. Ev-
erybody would be careful to stay within the
law. They bent the hell out of it. but thoy
didn't break it."
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Declassified in Part - Sanitized Copy Approved for Release 2012/02/09: CIA-RDP90-00965R000403270002-7