His Reaction to Arms Deal Revelation : North Told Bizarre Iran Hostage Tale

Some six weeks ago, the day that a Beirut magazine revealed the first details of the secret U.S. arms-and-hostages deal with Iran, a visibly agitated Lt. Col. Oliver L. North burst into the office of a National Security Council colleague and poured out a bizarre tale.

Denouncing the Beirut report as “disinformation,” North declared that the real plan for freeing American hostages was not to swap them for arms but to trade them for relatives of Iranian government officials, whom North said he had ordered kidnaped and held in “cages” or crates throughout Europe, according to sources close to North.

Dismayed, the colleague--identified as anti-terrorism specialist David Major--in subsequent days used the NSC’s secure in-house computer system to question North about the truth of his assertion, the sources said. Twice North ignored the queries. Finally, after the third demand to know whether he had in fact ordered kidnapings, North tapped out a one-word confirmation: “Yes.”

The episode, widely discussed by incredulous NSC staff members, underscores mounting questions about the judgment and veracity of a White House aide who played a pivotal role in managing one of the Reagan Administration’s most sensitive and risky foreign policy ventures.

President Reagan has praised North as a “national hero.” Congressional supporters have lauded him as a patriot and dedicated military hero who was, at most, over-committed to fighting communist expansion. And an Administration official said that Major now “does not believe Lt. Col. North kidnaped Iran officials.”

Yet sources with close knowledge of North and his career--while conceding his dedication--add another dimension to the portrait of the Marine officer who was removed from his White House post after disclosures that he had been at the center of a scheme for siphoning off Iranian arms sales profits to help the anti-Sandinista guerrillas in Nicaragua.

In this view, the impulse to cover exposure of the truth about his Iran arms dealings with an even more dramatic tale is typical of North. Instead of being a calm, restrained professional when it came to sensitive diplomatic initiatives and covert operations, these sources say, North sometimes displayed a shoot-from-the-hip, almost reckless penchant for grandiose endeavors and wild schemes.

The Times learned of North’s story about kidnaping Iranian citizens some days ago when accounts of the episode began circulating among officials close to the Iran- contras controversy. In pursuing the matter, Times reporters asked a range of knowledgeable sources about North’s record generally.

Said one well-placed Administration source, the kidnap story was “vintage Ollie.” Another source familiar with the account said of North: “He would rather tell a good story than the truth, even if the truth serves his purposes better.”

Indeed, other colleagues say North has boasted of exploits that, if told, would read like a Ken Follett spy thriller. Some say that North’s claims may not all be based on fact, however. He “crossed the line from truth into fantasy long ago,” a source familiar with North’s account of the purported kidnapings said.

Perhaps most important, some who worked closely with North said it was difficult to tell fact from fiction when dealing with him. A government official said that North embellished stories so often that the official was never certain when the NSC aide was telling the truth. “And that’s what makes it dangerous, because some of it--maybe a lot--is the truth,” the source said.

Motives Unclear

North’s motives in describing the purported Iranian kidnap plot were not clear, but the circumstances suggest he would have been under enormous pressure at the time and that his performance, if a hoax, was convincing enough for Major to have sought advice from others and reconfirmation from North.

On Nov. 3, the day North first told the story to Major, the Beirut magazine Al Shiraa had revealed that former U.S. National Security Adviser Robert C. McFarlane had flown secretly to Tehran with a shipment of arms and spare parts the previous May. The Reagan Administration has said that McFarlane’s mission was part of a U.S. effort to build bridges to so-called Iranian moderates, reduce terrorism and win freedom for Americans being held by pro-Iranian terrorists in Lebanon.

According to several sources to whom Major recounted the story, North burst into Major’s office and indignantly declared that the Lebanese reports, along with one expected to be carried that night on a U.S. television network, were “disinformation” being leaked from the NSC. He demanded that Major--a veteran of more than 20 years in the FBI before joining the NSC staff as a counterintelligence specialist--begin an FBI investigation of the leaks, one source said.

When the flabbergasted Major asked North if he had in fact been trading arms for hostages, North said he had undertaken a different and more bizarre program for gaining release of American hostages: His “friends” were kidnaping the relatives of senior Iranian government officials and were holding them in “cages” in Europe.

The nephew of Iranian Parliamentary Speaker Hashemi Rafsanjani was specifically mentioned by North, according to sources. North said that the Iranians eventually would be “crated back” and traded for American hostages, the sources said.

Shaken by Disclosure

Major was badly shaken by North’s unexpected outburst, according to sources to whom the story was recounted. And in subsequent days, Major sought to get North to repeat or confirm that he had in fact said he was kidnaping Iranian officials and their families.

North twice ignored Major’s efforts. Finally, after the third message on the NSC computer demanding to know if North was kidnaping Iranians in Europe, North gave his one-word affirmative response.

One source suggested that North himself was seeking to spread “disinformation” to hide his involvement in the arms deal. North was on the flight with McFarlane to Tehran. By that time, at least two arms shipments in which North had played a key role had been sent to Iran. Profits from those arms sales reportedly were diverted by North to the anti-Sandinista rebels in Nicaragua.

And sources knowledgeable about North’s activities recounted other stories that suggested he has an unusual taste for the dramatic.

For example, North told colleagues that the family dog in suburban Virginia was poisoned in retaliation for North’s outspoken support of the contras. But according to one source, “the dog died of cancer. It got old and died. Ollie told everybody that it was poisoned for effect.”

Source of Official Record

More serious, North was the main source of the White House’s official record of the Iran affair--a chronology provided to former National Security Adviser John M. Poindexter and CIA Director William J. Casey when the two men testified before the Senate and House intelligence committees Nov. 21.

Key facts were omitted from that record and significant parts are now in dispute. The North account, for instance, states that Reagan did not approve the first arms shipments in August and November, 1985--a claim that McFarlane disputes. The account also did not mention diversion of funds to the contras.

North has refused to testify before congressional committees investigating the scandal, invoking the Fifth Amendment privilege against self-incrimination. He has also declined repeated requests for interviews.

Nevertheless, North earned the admiration and respect of many during his government service. He is widely praised as a loyal patriot who responded to orders from above. Intense and driven, he is known to have worked more than 90 hours a week at the NSC.

Rep. Robert K. Dornan (R-Garden Grove), who worked with North in seeking congressional approval of aid to the contras, recalled that North was his White House contact on the contras, anti-terrorism efforts and aid to the Nicaraguan rebels.

“There was too much pressure on him and the White House was spreading him too thin,” the conservative congressman said.