McFarlane Links North’s Orders on Contras to Casey

Former White House aide Oliver L. North, the chief operative in the Iran- contra affair, appears to have taken his orders directly from William J. Casey, the late CIA director, former National Security Adviser Robert C. McFarlane testified Wednesday.

McFarlane, who sometimes responded with angry outbursts and rambling discourses during his third day before congressional committees investigating the affair, said that North had “more contact than I realized” with Casey, who died last week.

Committee members agreed. “I think it’s rather clear that Oliver North was acting under the aegis of Mr. Casey,” Sen. William S. Cohen (R-Me.) said.

Some committee members said that Casey may have channeled his orders through North as a means of escaping a ban imposed by Congress on CIA support for Nicaragua’s contra rebels . But Sen. David L. Boren (D-Okla.) speculated that it could have been the other way around: The Marine officer may have gone to Casey seeking authorization for his possibly illegal activities.

Strong Backer of Policy

The CIA director was one of President Reagan’s closest confidants and one of the strongest backers of Reagan’s policy of supporting the contras.

He is also the one principal in the Iran-contra affair who will not be able to tell his side of the story. Only hours before he was scheduled to discuss the scandal before a congressional panel last December, Casey suffered a brain seizure stemming from a cancerous tumor that left him disabled until his death from pneumonia.

As evidence of North’s central role in the Iran-contra affair has mounted, committee members said they have begun to have misgivings about their original plan to offer North limited immunity from prosecution in exchange for his testimony.

June Appearance Scheduled

The panels are currently scheduled to consider approving the grant of immunity on June 4 and to take his public testimony as early as June 23. So far, North has refused to testify before congressional investigators, citing his Fifth Amendment protection against self-incrimination.

McFarlane testified that Administration officials were under orders from President Reagan to help the Nicaraguan rebels “hold body and soul together” during the period when official U.S. aid was banned.

He said that North’s activities appear to have stretched the law’s vague boundaries. Several versions of the law banning military aid to the contras were in effect from mid-1984 until late last year.

The law prohibiting aid to the contras applied specifically to U.S. government agencies involved in intelligence activities. Some Republican members of the investigating committees said it was unclear whether that included the NSC, the White House office designed to advise the President on national security matters.

Admits Congress’ Intent

But McFarlane, who as the President’s national security adviser was the director of the NSC staff, admitted to the committees that the law’s intention was clear: Congress “didn’t want anybody in the U.S. government assisting the contras.”

McFarlane, who will return to the witness table today, said that Reagan was “conscious of everything that I did that was close to the line.” He noted, however, that he did not inform Reagan or Congress of his suspicions that North was breaking the law.

“I could not prove that it was violated and I accepted Col. North’s personal certification that he had not done so,” McFarlane said. But he added: “It seemed to me that it was likely that he had . . . provided assistance to them (the contras) that went beyond the law.”

McFarlane also said that he had been “periodically concerned about the almost certain temptation to raise money that would come up whenever Ollie would go out and talk to groups throughout the country. . . . That (fund-raising) was proscribed, and we had to be very careful not to do that.”

‘More Liberal Interpretation’

But he added that when he informed the President of his concerns, Reagan “had a far more liberal interpretation of that than I did, I think.”

McFarlane testified that North had told him of the diversion of funds to the contras in May, 1986, five months after McFarlane had resigned as Reagan’s national security adviser. McFarlane, who at that time had been pressed back into service to assist in the Iran arms sales, said that North had assured him the transfer of funds had been authorized, although he said North had not told him by whom.

Cohen said in an interview that he and other committee members suspect that when North told McFarlane he had obtained higher “authority” for diverting funds from the Iran arms sale to the contras, he was referring to permission from Casey--not Reagan.

Notes North’s Rank

Cohen noted that North acted with an apparent authority that extended far beyond what would be expected from a relatively low-ranking Marine officer.

“We have evidence that Col. North was calling a (CIA) chief of station in a Central American country (Costa Rica) and having him report to Col. North,” Cohen said. “We have an ambassador being called in Lebanon and having him report to Col. North.”

Cohen was the third committee member to question McFarlane about the Casey-North relationship. On Tuesday, Sen. Paul S. Sarbanes (D-Md.) raised it by asking if North had “unusual access” to the CIA director. McFarlane replied: “I think so.” But he added that he was not aware of it at the time.

“I knew that he told him occasionally what the status of things was in Central America,” he said. “I did know that Director Casey had a very high regard for Col. North.”

In response to a similar line of questioning by Rep. Dante B. Fascell (D-Fla.), McFarlane said that North coordinated the Iran arms sales with the approval of CIA--the agency that would normally handle such operations. But McFarlane added that North did not have authority to contact the CIA for help in these matters without clearing it with him.

Suggests Casey’s Motive

Sarbanes suggested that Casey encouraged North to divert Iran arms sale profits to the contras because his own staff at the CIA was specifically prohibited from doing so by the law banning U.S. government aid to the contras.

“If his own people were in on it, you would have to have a finding,” Sarbanes said in an interview. A finding is a document that Reagan must sign and submit to Congress when the government engages in a covert action.

On the other hand, Boren said in an interview that North may have been shopping around for someone to authorize his activities and found that Casey would do so. He noted that Casey had an office near North’s in the Old Executive Office Building.

“He was not under very close supervision of McFarlane, and testimony from John Poindexter (who succeeded McFarlane as national security adviser) will show that he was not under close supervision of Poindexter--or the President.”

“I don’t know that he was under anyone’s supervision,” Boren added.

Evidence of Relationship

McFarlane said North once told him that Casey, a wealthy man, had volunteered to give him $1 million--a remark that he interpreted as “expressive of a relationship” between North and Casey. McFarlane did not explain the remark further.

As McFarlane faced one committee member after another throughout the day, he appeared to be under intense strain. The former national security adviser attempted suicide three months ago.

At one point, he complained angrily, “people don’t volunteer to come in and work for government for these wonderful wages and occasionally get shot at, and spend 30 years doing that, so that they can be ridiculed by someone who hasn’t got the patience to study the facts.”

Asked by Sen. James A. McClure (R-Ida.) to explain why he had participated in drafting a “false and misleading” early version of events, McFarlane launched into a lengthy lecture on the failure of the White House and Congress to work together on foreign policy. By the time he had finished, he had blamed such factors as a weak public school program, campaign financing, military ineffectiveness and a national preoccupation with domestic issues.

Doubts on Capability

Later, McFarlane said that one of the reasons he resigned as national security adviser in 1985 was a belief that “the organization of the Administration for the conduct of foreign policy (was) intrinsically unworkable.”

When challenged about his failure to intervene when North told him he planned a “shredding party” to destroy important records, McFarlane answered angrily: “I deserve responsibility, and I ought to be prosecuted to the full extent of the law and sent away.”

Throughout his testimony, McFarlane has attributed the numerous inconsistencies between his account of events and documentary evidence to his lapses of memory.