THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Saturday, October 15, 1994 TAG: 9410150231
SECTION: FRONT PAGE: A1 EDITION: FINAL
SOURCE: BY JOHN WALLACH, HEARST NEWSPAPERS
DATELINE: WASHINGTON LENGTH: Medium: 88 lines
Seven years after Congress ended its investigation of the Iran-Contra affair, Oliver North has the potential to receive at least $2.3 million in Iran arms sales profits that are frozen in Swiss bank accounts, government documents show.
North, the Republican candidate for the U.S. Senate in Virginia in the Nov. 8 election, is a potential beneficiary of two different bank accounts set up in 1986 by his two former business associates, Iranian-born Albert Hakim and retired Air Force Maj. Gen. Richard V. Secord.
North issued a statement late Friday disclaiming any interest in profiting from either account.
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 that is named the ``B. Button'' account. Congressional investigators 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 Betsy North in Philadelphia to obtain the names and ages of her children. The account has earned more than $12,000 in interest.
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 investment account had earned $129,151.51 as of September 1993.
Under a legal agreement executed on 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 Justice Department soon after the arms deals became public.
Dan McLagan, director of communications for North's senatorial 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.
``North never knew about either account,'' 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.''
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.
Since December 1986, the 16 accounts have been consolidated and their names and numbers changed by Zucker. For example, A.H. Sub-Account 1 is now listed as account No. 4224. Taken together, 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 and in Geneva, Switzerland. The outcome of these cases, and other factors, would determine whether North actually could benefit from the Enterprise accounts.
Lawrence Walsh, the former independent counsel who investigated Iran-Contra for nearly seven years, said in an interview that North has taken no steps to disavow or abrogate his interest in the Swiss accounts.
``I know of no act by North to disassociate himself from any of these,'' Walsh said.
Walsh noted that North has 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.
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.''
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