North Reported Saying Contra Aid Israel’s Idea

Atty. Gen. Edwin Meese III has testified that Lt. Col. Oliver L. North told him an Israeli official first proposed using proceeds from the sale of arms to Iran to fund the contras , it was reported today.

According to congressional and Justice Department sources, Meese testified that North told him of a meeting about a year ago with an Israeli official to discuss funding for the Nicaraguan rebels, the New York Times said.

The official, identified by a congressional source and a Justice Department source as David Kimche, director general of the Israeli Foreign Ministry, told North there were three options, the newspaper reported.

Kimche said money for the contras could come from U.S. funds or from foreign aid to Israel--both of which would violate a congressional ban on aid to the rebels--or from increasing the price of weapons sold to Iran and sending the proceeds to the rebels, the report said.

The congressional account of Meese’s testimony before the House and Senate intelligence committees was confirmed by the Justice Department official, who said the department had been unable to corroborate North’s assertions, the newspaper said.

It said the assertions attributed to the fired National Security Council staff member could not be independently verified.

Kimche told the newspaper: “The whole thing is ridiculous. If that is what Oliver North testified to, then he is an unmitigated liar.” He said he first heard about the diversion of funds through newspaper accounts.

If true, the statements by North would suggest a larger Israeli role than has been acknowledged.

The Israeli government has repeatedly denied that it had knowledge of or was in any way involved in the diversion of funds from the Iranian arms sale to the Nicaraguan rebels.