Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, October 15, 1994 TAG: 9410170064
SECTION: NATIONAL/INTERNATIONAL PAGE: A1 EDITION: METRO
SOURCE: HEARST NEWSPAPERS Note: above
DATELINE: WASHINGTON LENGTH: Long
For seven years after Congress ended its investigation of the Iran-Contra affair, Oliver North had the potential to receive at least $2.3 million in Iran arms sales profits that are frozen in Swiss bank accounts, according to government documents.
North, the Republican candidate for Virginia's U.S. Senate seat in the Nov. 8 election, was the potential beneficiary of two bank accounts set up in 1986 by two former business associates, Iranian-born Albert Hakim and retired Air Force Maj. Gen. Richard Secord.
On Friday, after Hearst News Service reported that he could potentially collect from the accounts, North issued a statement disclaiming any interest in profiting from them.
Dan McLagan, director of communications for North's campaign, issued a statement Friday night suggesting that North didn't have to take action to assure that he wouldn't benefit from the accounts and declaring North's lack of interest in the deposits.
``North never knew about either account'' at the time they were created, McLagan said. ``He was never charged with knowledge of them or with accepting anything from them. Under no circumstances did he receive anything from them. Anyone who wanted to have a claim to any of those funds had to file a claim with the Swiss court. He doesn't want the money. He has no interest in the money.''
The first account - on deposit in Credit Suisse Bank in Geneva - is a $200,000 investment fund for the education of North's four children which is named the ``B. Button'' account. Congressional probers discovered that the telephone number on the documents creating the account was the telephone number for North's residence at the time in Great Falls, Va.
The account was opened in May 1986 by the ``Enterprise,'' the covert arms-dealing business set up by Hakim and Secord.
It was created after Willard Zucker, the Enterprise's financial manager, met on March 1, 1986, with North's wife, Betsy, in Philadelphia to obtain the names and ages of her children. North's notes confirm that he knew about his wife's meeting with Zucker.
The second account - held at Compagnie de Services Fiduciaires (CSF) and known originally as RVSAH (Richard V. Secord Albert Hakim) - was set up on March 5, 1986, with a $2 million deposit.
The two accounts have earned more than $140,000 in interest.
Under a legal agreement executed May 15, 1986, between Hakim and CSF Investments Ltd., the name of the account was changed from RVSAH to ``A.H. Sub-Account 1'' and North was named as the sole beneficiary in the event anything incapacitated Hakim and Secord.
Both accounts were frozen in December 1986 by the Swiss government at the request of the U.S. Justice Department soon after the arms deals became public.
In all, 16 Enterprise accounts were frozen containing $7.8 million - slightly less than half the $16 million in profits generated by the $33 million in Iran arms sales. The accounts have earned about $3 million in interest, bringing their total balance to just under $11 million.
These accounts are now the subject of lawsuits filed by the U.S. government in federal court in Alexandria, Va., and in Geneva, Switzerland.
Before North issued his disclaimer late Friday, Lawrence Walsh, the former independent counsel who investigated Iran-Contra for nearly seven years, noted that North had taken no steps to disavow or abrogate his interest in the Swiss accounts.
``I know of no act by North to dissociate himself from any of these,'' Walsh said in an interview.
Walsh noted that North had had seven years to rescind his interest in the $2 million fund and the $200,000 fund by simply taking his name off them. His failure to do so ``is significant,'' Walsh said.
``Those were American funds that were skimmed off from the sale to the Iranians which North approved going into a private Swiss account,'' he said. ``Those funds should have gone to the U.S. Treasury. Profits don't go into the individual accounts of the guy who delivered the weapons.''
Secord, in an interview, said Hakim had no authority to write North or himself into what amounts to a $2 million will.
``I was the guy who ran the Enterprise. Hakim was just a hired gun. He didn't have the authority to do that,'' Secord said.
According to Secord, North had no knowledge that he was being named a beneficiary in either account. ``He was a victim of this stupidity of Hakim's and Zucker's,'' said Secord.
Earlier this week, North refused to return repeated telephone calls seeking comment on the potential windfall. Instead, his spokesman, McLagan, said: ``I'm sure he knows about them now since they [congressional investigators] asked him about them.'' But he said North stands by his testimony that he was unaware of being named in either account at the time they were set up.
On July 8, 1987, during the congressional Iran-Contra hearings, North was asked whether he had ``any interests, personal interests, in any of the monies that flowed from the arms sales to Iran or that were kept in Swiss accounts under Gen. Secord's control?''
North replied: ``Not one penny.''
Keywords:
POLITICS
by CNB