Panel Suggests Four Possible Law Violations

The Tower Commission report has raised the possibility that Reagan Administration officials violated at least four federal laws in the Iran- contr a transactions.

The contention that laws may have been broken is supported by at least some Administration officials, including Atty. Gen. Edwin Meese III, who reversed his initial legal assessment after more details of the transactions came to light, according to documents published with the report.

Only one of the four laws cited by the commission--the Arms Export Control Act--carries criminal penalties: fines of up to $1 million on each violation and 10 years’ imprisonment. Although the other three laws cited by the commission are civil statutes and carry no criminal penalties, Justice Department sources noted that criminal prosecutions can be brought for conspiracy to violate them. In addition, criminal penalties could result from a law not mentioned by the commission, the Anti-Deficiency Act, which prohibits knowing and willful spending of funds that have not been appropriated by Congress.

The Tower board stressed that, in its report, it was not making any judgment about criminal culpability. Charges of obstruction of justice or perjury may also result from the continuing investigations into the scandal.

However, the commission declared that “the legal underpinning of the Iran initiative during 1985 was at best highly questionable.”

Meese, who at the outset of the case said he was uncertain that any laws had been broken, clearly indicated a change in this stand in a Feb. 18 letter to former Sen. John Tower (R-Tex.). Meese told the commission’s chairman that the CIA’s assistance in delivering arms to Iran in November, 1985, probably violated federal law.

Under a congressional ban in effect at the time of the weapons shipments, the CIA was prohibited from conducting non-intelligence activities without a presidential directive that declared the operation important to national security.

Meese Gives Hint

Meese gave the first hint that he had changed his mind about the legality of the affair on Feb. 3 when asked about his initial position that money generated by the arms sales to Iran may not have been government funds and, thus, their possible transfer to the contras would not have been illegal.

Describing that position as “very preliminary,” Meese at the February press conference said: “There was no clear-cut indication that they were government funds, certainly, and we ultimately developed some theories on which they might be considered government funds.”

The attorney general added that the question would be decided by Independent Counsel Lawrence E. Walsh, whose office declined comment Friday.

In addition to the Hughes-Ryan Amendment prohibition that Meese cited in his letter to Tower, other laws that may have been violated are the Boland Amendment, the Arms Export Control Act and the National Security Act, according to the commission’s findings.

Concern over covert U.S. support for the Nicaraguan rebels led Congress on Dec. 21, 1982, to adopt the Boland Amendment, which barred the CIA and the Pentagon from spending funds on “overthrowing the government of Nicaragua or provoking a military exchange between Nicaragua and Honduras.”

Updates Amendment

Two years later, Congress updated the ban by prohibiting the CIA, the Pentagon or any other U.S. agency “involved in intelligence activities” to spend federal funds on military or paramilitary operations in Nicaragua.

Some in Congress contended that the amendment applied to the NSC, but a classified legal memorandum retrieved from Lt. Col. Oliver L. North’s safe maintained that the council “is not covered by the prohibition.”

The Tower Commission said the legal memo “apparently was prepared by the President’s Intelligence Oversight Board,” which the commission noted is “an odd source” to be issuing such advice.

“It would be one thing for Intelligence Oversight Board to review the legal advice provided by some other agency,” the report said. “It is another for IOB to be originating legal advice of its own. That is a function more appropriate for the NSC staff’s own legal counsel.”

Export License Needed

Under the Arms Export Control Act, the principal federal law covering arms sales abroad, the export of arms without a license is illegal. Exports of arms by U.S. government agencies do not require licenses if they are otherwise authorized by law, the commission noted.

In the case of the initial Israeli transfer of arms to Iran that began in August, 1985, Robert C. McFarlane, then national security adviser, had communicated U.S. approval.

Without President Reagan’s approval, however, the 1985 transfer would have broken U.S. law, the commission said. While the board could not reach a conclusive judgment on whether Reagan had approved the transaction, it said it was “plausible to conclude that he did approve them in advance.”

However, even if he did, “a serious question of law remains,” the report said.

Did Not Meet Conditions

Reagan’s consent, if it had been given, “did not meet the conditions of the Arms Export Control Act, especially in the absence of a prior written commitment from the Iranians” that they would not transfer the arms to others, the commission said.

The report cited the National Security Act as another possible avenue for authorizing government arms transfers to Iran. But, under that law, the commission noted that “it is not clear that mere oral approval by the President would qualify as a presidential finding that the initiative was vital to the national security interests of the United States.”

“The approval was never reduced to writing,” the report said. “It appears to have been conveyed to only one person. The President himself has no memory of it. And there is contradictory evidence from the President’s advisers about how the President responded when he learned of the arms shipments which the approval was to support. . . .

“In these circumstances, even if the President approved of the transactions, it is difficult to conclude that his actions constituted adequate legal authority.”