Secord Used Arms Profit, Prober Says : Retired General Tied to Purchase of Car, Airplane

Retired Air Force Maj. Gen. Richard V. Secord financed a sports car, a private airplane and a visit to a luxury health spa with more than $80,000 in profits he took from the sales of U.S. arms to Iran, a member of the congressional investigating committees said Thursday.

At the same time, Albert A. Hakim, financial manager of the Iran- contra operation, testified that it is “impossible” that former White House aide Oliver L. North did not learn about a secret $200,000 Swiss bank account established for his family from Iran-contra funds. The North family never actually received the money.

Expected ‘Many Millions’

Hakim’s testimony shed new light on the way that he and his partner, Secord, frequently set aside money for themselves and other people who were helpful to them in shipping U.S. arms to Iran and supplying weapons to the Nicaraguan resistance. He acknowledged that they had expected the Iranian arms sales to generate “many millions” of dollars in profit for them.

Sen. Paul S. Trible Jr. (R-Va.), a committee member, said the panels have found evidence that Secord made three withdrawals from a $1.5-million Swiss bank account that was created for him by Hakim from the funds generated by the Iran-contra transactions. He said that two of those withdrawals occurred in 1986, after Secord claims to have renounced all interest in profits from the operation, and one was in 1985.

Trip to ‘Fat Farm’

The money withdrawn by Secord was spent on a 1986 Porsche automobile costing more than $30,000, a Piper Cub airplane exceeding $50,000 and a $2,300 visit that he and one of his business associates, former CIA operative Thomas Clines, made in July, 1986, to an unidentified “fat farm,” according to Trible.

Other Withdrawals Possible

It is not known whether Secord made any other withdrawals from the account, but Trible said there is “no reason to believe” that these were the only three expenditures that he made from the fund. Most of the money in the account came from the sales of U.S. arms to Iran.

Not only has Secord testified that he forswore all profits from the Iran-contra affair, he also told the committees that he was unaware of the Swiss bank account named “Korel” that financed his luxury purchases. Instead, he portrayed himself as a modest, middle-class man with a government pension, a mortgage and virtually no personal savings.

In fact, Secord protested frequently during his testimony that he did not even have enough money to pay the attorney who was representing him at the hearings.

Hakim was asked why Secord’s Korel account grew from $1.04 million to $1.57 million over the last six months. He said that he could not explain it unless someone had continued to make deposits into it after the Iran-contra scandal came to light last November. He said that his last deposit into Secord’s account occurred in August, 1986.

The $200,000 fund that Hakim created for North was likened by Senate committee counsel Arthur L. Liman to the practice of bribing public officials that is common in Hakim’s native land of Iran. Hakim even acknowledged that when he lived in Iran, he often used Swiss bank accounts to bribe Iranian officials.

‘Love at First Sight’

When Hakim insisted that he created the fund only because he had grown to “love” and admire North, Liman quickly noted that it was established less than three months after the two men met, and he ridiculed Hakim’s expressed motives, calling it “love at first sight.”

“I set up accounts for everyone that falls within my financial and commercial network (if it is) necessary to set up such accounts,” Hakim later acknowledged.

Earlier in the day, David M. Lewis, a Washington lawyer, testified that Hakim’s attorney had tried to give the money to North’s family by creating a phony real estate transaction from which North’s wife, Betsy, was to get the $200,000 in what would be portrayed as a real estate commission.

He said that it was designed to be a “mirror transaction” in which someone in the United States would give Mrs. North the money and an identical sum would be deposited for that person in a Swiss bank account.

Lewis said he was told by Hakim’s attorney, Willard I. Zucker, that North “earned” the money.

Hakim has said that Zucker even summoned North’s wife to a meeting in Philadelphia to discuss the money but he never succeeded in finding a suitable method of transferring it to the North family.

‘Pretty Preposterous’

Liman condemned as “pretty preposterous” Hakim’s contention that he sought to find a backdoor route to give the money to the North family so that North himself would never find out about it. Hakim acknowledged that he knew it is illegal to give valuable gifts to officials of the U.S. government.

Hakim then admitted that he had told the committee in an earlier closed session that he thought North eventually would have learned the true source of the money. “I would have found it impossible for him not to know,” he said.

Moreover, Hakim conceded that Secord had led him to believe that North would not object to the $200,000 contribution, which was to be used for the education of North’s four children. And, in fact, Hakim noted that North never raised any objection with him--even after his wife returned from her trip to Philadelphia.

Hakim also modified his contention, made on Wednesday, that North “was never aware” of a will that would have given him $2 million from the arms sales in the event of the death or disability of both Hakim and Secord. He said that he had told Secord about it and that he was “under the impression” that Secord would inform North of the windfall he would get if the partners died.

Bought Jeans, Shirts

Ironically, while North apparently did not reject the $200,000 fund or the will, Hakim was unsuccessful in trying to provide gifts for the children of an Iranian official with whom he was dealing at the time on the U.S. arms sales. He said that he purchased jeans and shirts for the children during a stay in Geneva but that the Iranian official stuffed a $100 bill in Hakim’s pocket before they parted.

Hakim said he thought he had a “definite obligation” to compensate the Iranians with whom he dealt last October in setting up a final U.S. shipment of 500 TOW missiles to Iran. However, he disputed Liman’s characterization of this obligation as a “payoff.” Instead, he said: “They would be my partners.”

Hakim was at a loss to explain a piece of paper bearing the handwriting of his attorney, Zucker, which has suggested to some committee investigators that North’s wife may have actually received a transfer of $15,000 from the Iran-contra fund held by Secord and Hakim. Committee members have been unable to establish the meaning of the paper.

Hakim’s testimony offered investigators an opportunity to probe what is seen by some committee members as the most troubling issue raised by the Iran-contra affair: the secret delegation of far-reaching U.S. foreign policy decisions to private businessmen.

Sharp Exchange

In one particularly sharp exchange, Liman suggested that Hakim essentially had become “secretary of state for a day” when North left him in Frankfurt, West Germany, last October to negotiate what became a nine-point agreement with the Iranians. The agreement led to the final shipment of 500 TOW missiles to Iran and the release of one American hostage from Lebanon, David P. Jacobsen.

North himself had devised a seven-point proposal that included the release of all American hostages in exchange for 2,000 TOW missiles. But the talks quickly broke down because North was too hasty--trying “to establish a relationship as if we are preparing stew in a pressure cooker,” Hakim said.

When the talks collapsed, he added, North flew back to Washington and left Hakim--whose interests were primarily in making money from the deal--to salvage the delicate diplomatic effort. As he departed, North told Hakim that he would be briefing President Reagan immediately after a six-hour flight and asked him to “turn this thing around” in that time.

At that point in the testimony, Liman observed to Hakim that “you, a private citizen and businessman, all of a sudden found yourself in the role of trying to work out an agreement for the United States . . . seeking not just to advance the United States’ interests, but profit.”

‘Not Discussing Benefit’

“Mr. Liman,” Hakim replied indignantly, “our secretary of state comes also from the business end of our structure. At the time that I was negotiating, I was not discussing my own personal benefit.”

Cites National Interest

He added that he had only the national interest in mind as he sat down to bargain with the Iranian delegation and said: “What bothered me was that we didn’t have the competence within the government to do what I could do.”

It was so unusual for a private citizen to be involved in such high-level talks that Hakim has been denied the right to read his own top-secret account of these proceedings because he has no government security clearance.

The nine-point plan that resulted from the meeting included the release of only one hostage--with the possibility of the release of a second as well--and an agreement for the United States to press for the freedom of 17 Shia Muslims convicted by Kuwait of terrorism. The latter provision of the deal ran directly afoul of official U.S. policy.

Although Hakim testified that North told him this plan had been approved, the Administration has said it never gave its endorsement.

Liman portrayed the Frankfurt meeting as a somewhat comical event in which a private businessman was negotiating on behalf of the U.S. government and North was frequently dropping the name of the President of the United States for emphasis.

Portrayed as Hustlers

“You can get the impression here that North is hustling you, that you’re hustling North, that the Iranians are hustling you, that you’re hustling the Iranians and that it really is, as you said before, . . . a commercial type of environment,” he said.

A chief concern for North at the Frankfurt meeting was that the hostages be released before the November elections in which Republican control of the Senate hung in the balance, Hakim said.

“Col. North wanted to remove this obstacle (the hostages) for the purpose of enhancing the President’s position,” he said. “Definitely, he was trying to achieve this goal.”

In a deposition from Hakim that was taken earlier and read aloud by Liman, the businessman said he expressed concern that North’s immediate political motivations could jeopardize his longer-term goals of building a relationship with Iran.

Called ‘Counterproductive’

Liman also quoted Hakim as having told the committee staff that North’s “prime objective at the time was to support the President in connection, or the Republicans or the elections, and I found that to be counterproductive.”

The Republicans lost their Senate majority in the elections.

In addition, Hakim provided some fresh detail about the much-publicized tour of the White House that North gave to an Iranian official after a meeting in September, 1986.