Report Inconclusive on Reagan Arms Deal Role : Senate Probe Cites Instances of His Involvement, Finds No Evidence of Presidential Wrongdoing

President Reagan is portrayed in the Senate Intelligence Committee’s secret report on the Iran- contra scandal as a detached leader who was led into a major foreign policy blunder by overzealous White House aides, Israeli Prime Minister Shimon Peres and a few freewheeling international arms dealers.

And while the report’s description of Reagan’s role in the affair is certainly unflattering, it is also clear from every available account of the yet-unpublished document why White House officials are urging that it be made public. So far, congressional investigators have no evidence of presidential wrongdoing.

“There is no smoking gun,” said committee Chairman David L. Boren (D-Okla.).

Democrats such as Boren, who oppose publication of the report, are now being accused by the White House of trying to suppress information that would help to exonerate the President. White House Communications Director Patrick J. Buchanan strongly questioned the Democrats’ argument that the report represents the results of an incomplete investigation.

‘They’re After Reagan’

“The Democrats tell us this investigation must be dragged out to get at the truth,” Buchanan said. “They’re not after the truth; they’re after Ronald Reagan.”

Yet even Sen. Dave Durenberger (R-Minn.), who as the committee’s former chairman was responsible for drafting the report, admitted that no final conclusions can be drawn about the President’s involvement until Congress hears from key witnesses such as former White House aide Oliver L. North, who refused to testify before the Senate Intelligence Committee.

“Unless Ollie North testifies,” Durenberger said, “they’ll never, never get the answer to the question, ‘Did Ronald Reagan know?’ ”

In general, the committee found that the sales of U.S. arms to Iran were initiated by the President at the request of Peres and that the plan to divert profits from the arms sales to the Nicaraguan rebels was advocated by Israel and an Iranian arms dealer--apparently as an incentive to keep the Reagan Administration interested in continuing the arms shipments.

In addition, while the committee found no evidence to prove that the contras actually received any money from the deal, it appears that about $8.5 million was diverted with the intent of sending it to the contras--all or most of it coming from the pockets of private investors who were not fully repaid for the money they had put up to facilitate the arms deal.

Reagan’s Involvement

According to a variety of sources who have read it, the committee’s lengthy report cites these instances of Reagan’s personal involvement in the Iran-contra scandal:

--Despite White House denials, committee members appear to believe the testimony of former White House National Security Adviser Robert C. McFarlane that the President orally approved Israeli arms shipments in August, 1985. Sources said that McFarlane provided the committee with convincing details of meetings leading up to the decision as well as a persuasive account of how the President gave his OK.

--The President signed at least two findings--one dated Jan. 6, 1986, and the other a few days later on Jan. 17--permitting the direct shipments of U.S. arms to Iran. The two findings differed in only three words. It is not known why the sale did not proceed after the first finding, but it is known that Reagan met again with aides on Jan. 7 to review the matter once more.

Didn’t Read Memo

--When the President signed the Jan. 17 finding, he did not read the accompanying three-page action memo prepared by North. Nor was the memo initialed by the President. Instead, John M. Poindexter, then the national security adviser, read excerpts of the memo to Reagan and signed the President’s initials. It is presumed by committee investigators that Reagan was already familiar with the issues and did not feel a need to read the supporting document.

--The President was persuaded last February to continue the arms sales to Iran--even though the first shipments failed to win release of American hostages held in Lebanon--when he received a personal letter from Peres pleading for continuation of the policy. The letter was deleted from the committee’s report at the request of State Department officials, who routinely protect against the release of communications between heads of state.

--Reagan personally wrote a letter to Peres at a later date to thank him for the role played by Amiram Nir, the Israeli emissary who is credited in the report with having persuaded the Reagan Administration to begin direct arms shipments to Iran last January and with proposing the diversion of profits to the contras.

Diversion of Funds

At the insistence of one Democratic member, Sen. Sam Nunn (D-Ga.), the report emphasizes that the committee was unable to reach many important conclusions--one of them being whether the President was unaware of the diversion of funds to the contras, as he claims.

At Durenberger’s request, the committee deleted a series of conclusions critical of the Administration that were included in a draft report prepared by its staff on the ground that they were unproven and would require further investigation.

Despite a lack of evidence, committee members clearly are divided on the issue of whether the money could have been diverted to the contras without the President’s knowledge. But even those who support Reagan’s story acknowledge that it only serves to reinforce a portrait of him as too detached from the day-to-day details of government.

“For the President,” a GOP source said, “the worst part is that the report gives a stronger sense that he didn’t know what was going on. The White House wants it out to prove they did nothing wrong but it also reinforces the concept that they did nothing right either.”

Helps to Clear Reagan

The report also helps to clear President Reagan of any complicity in the diversion of funds by characterizing North as an “activist” with many contacts in the government who would take actions without getting specific approval from his superiors, sources said.

Likewise, according to sources, Poindexter is portrayed in the report as a “passive” administrator who, while meticulous about meetings and paper work, did not keep close tabs on the activities of the people on his staff.

It is understood that the report finds that both Nir and Manucher Ghorbanifar, an Iranian arms dealer who served as a go-between in the deal, had suggested that some of the profits from the arms sale be diverted to the contras. In fact, according to sources, Nir also offered direct Israeli financing of the contras, and Israel later may have shipped them some weapons.

Financing for Contras

These suggestions by Nir and Ghorbanifar were made at a time when the Reagan Administration was reconsidering its willingness to send arms to Iran without winning the release of all American hostages held in Lebanon. They clearly were appealing to North, who also was assigned to obtain financing for the contras.

Attached to the report is a memo that North wrote to Poindexter, on April 4, 1986, suggesting the diversion of funds. It is not known whether this was the first time the idea was considered at the White House. According to sources, Poindexter later told White House Chief of Staff Donald T. Regan that he allowed the plan to go through because he “felt sorry” for the contras, whose military aid had been cut off by Congress.

But committee investigators are not certain whether North, Nir or Ghorbanifar--or all three of them--hatched the idea of diverting the profits from the arms sales to the contras. Witnesses told the committee that North chose it as a means of financing the contras because he believed it would legally circumvent a congressional ban on direct or indirect U.S. aid to the anti-Sandinista forces.

Committee Vice Chairman William S. Cohen (R-Me.) said the committee found that the President erred by taking the advice of men such as Ghorbanifar, Nir and North over the advice of Secretary of State George P. Shultz and Defense Secretary Caspar W. Weinberger, who opposed the sale of arms to Iran from the outset.

‘Turned to Amateurs’

“I think what is clear is that the President turned to amateurs for his advice on a major foreign policy initiative, rather than listening to the sound and seasoned voices of the experts,” he said. “And that’s where I think the President made his mistake.”

On the question of whether the arms sales were strictly intended to win release of American hostages, the committee also came to no conclusion. Cohen said that he personally believes the operation began as an overture to moderate elements in Iran and quickly became sidetracked as a policy focused exclusively on hostages.

Nor do many committee members appear to be convinced by the suggestion of some Reagan Administration witnesses that the arms sales and the diversion occurred primarily because of prodding by Israel. “We were a full partner in this,” Cohen declared.

White House officials were aware of the contents of the Senate Intelligence Committee report before Reagan urged that it be made public. In fact, three White House officials were present more than a week ago when committee staffers deleted about 20 to 25 pages of the report, primarily to preserve national security secrets if the document ever becomes public.

The committee voted 7 to 6 last Monday night to keep it secret, primarily because many members had not yet read the report but also because many members spotted what they viewed as inaccuracies. As a result, Boren and Cohen are promising to publish a revised summary of the committee’s findings within the next two weeks.