A prominent 60-year-old Swiss shipping magnate with a secret bank account was the mistaken recipient of the long-lost $10-million contribution to the Nicaraguan contras from the Sultan of Brunei, congressional investigators announced Tuesday.
The donation, which was deposited in the wrong Swiss account last August because of a high-level mix-up in account numbers, had been the last major financial mystery of the Iran-contra affair.
“This was the last big chunk we could not trace,” said Mark A. Belnick, attorney for the Senate committee investigating the Iran-contra affair. “No one was making an earnest effort to find that money. We set out to find it, and I think we have.”
Swiss authorities quickly froze the funds, which have earned $253,000 in interest since last August or September, when the owner of the account transferred them into a certificate of deposit in another bank. Criminal charges were filed against the recipient, whose identity was not disclosed by Swiss authorities.
The unnamed shipping executive told authorities that he had been expecting a large amount to be deposited into his account at about the same time that the sultan’s money appeared and that he was not aware the $10 million had been put there by mistake.
Although committee investigators are satisfied that the mistaken recipient of the funds played no role in the Iran-contra affair, Belnick said, the matter is still being reviewed by Swiss authorities. He said criminal charges may be dropped if the shipper’s story proves true.
Meanwhile, the $10 million--including the interest--still belongs legally to the sultan and not to the contras or the United States, according to Belnick. “The sultan will have to decide what he wants to do with it,” he said.
The donation was solicited last year from the sultan by Assistant Secretary of State Elliott Abrams. Brunei, a tiny, oil-rich sultanate on the island of Borneo, was one of several nations that were encouraged by U.S. officials to contribute to the contras in 1985 and 1986.
The sultan’s check apparently was diverted to the wrong Swiss bank account because Marine Lt. Col. Oliver L. North, then a White House aide, gave Abrams the wrong number for the contras’ account.
According to investigators, the number that Abrams received on a card from North had the prefix of “368,” but the contras’ account begins with the prefix “386.”
Belnick said investigators first suspected the missing money had intentionally been diverted to some other purpose by North or his associates in the Iran-contra affair, but the evidence led them to conclude that the money was simply lost.
“Everyone on one side said the money went into the account, everyone on the other side said we never got it,” he recalled.
Swiss banking officials refused to cooperate in tracing the money until attorneys for the Senate committee obtained authorization from the sultan. “Once the customer said we were his authorized agent,” Belnick said, “doors began to open.”
Sen. Daniel K. Inouye (D-Hawaii), chairman of the Senate investigating committee, announced at the opening of Tuesday’s hearing that the money had been traced.
He said, without so much as a smile: “I suppose the question before us is: ‘Does the Senate select committee get a finder’s fee?’ ”