Ghosts of CIA Haunt Hearings

James Bamford is author of "The Puzzle Palace" (Houghton Mifflin), an analysis of the National Security Agency

Although the Iran- contra hearings may be little more than passing interest to most of the townspeople of Marion, Ill., a rural farm community in the south-central part of the state, there is one resident glued to his small black-and-white television whenever the hearings are broadcast or even discussed on the news. All day, day after day, he sits alone in his tiny room, as he has for more than four years and as he may for the rest of his life, with only his TV and a small radio for company.

Locked in solitary, in the most secure section of the nation's most heavily guarded federal prison, Edwin P. Wilson, former deep-cover Central Intelligence Agency and Naval Intelligence operative, listens as former friends and associates take their seats behind the witness table. With nearly half a century left on his multiple sentences for selling arms and explosives to Libya and placing potential government witnesses on a hit list, the 59-year-old inmate has nothing but time.

But while a dozen steel doors separate Marion's K-Unit from the outside world, the ghost of Wilson has become a significant part of the Iran- contra hearings. The first witness, former Maj. Gen. Richard V. Secord, who directed the contra airlift program and aided in the Iran operation, was questioned repeatedly about his past associations with Wilson and his relationship with him in a company set up to transport Pentagon hardware and weapons to Egypt.

Later, longtime CIA operative Felix Rodriguez testified that he had warned Lt. Col. Oliver L. North about Secord's previous shady dealings and became concerned when he learned that other former Wilson associates, such as Thomas G. Clines and Raphael Quintero, were involved in the contra effort. Should deals of the enterprise leak out, Rodriguez said, "It's going to be worse than Watergate and this could destroy the President of the United States." When asked by one committee member whether he was concerned that the operation represented "the old Wilson gang in business once again," Rodriguez answered, "Yes, sir."

Recently, behind closed doors, the committee staff began looking into the activities of another close Wilson associate and former CIA official who played a major role in the contra, and possibly Iran, operations: Clines. A hefty, cigar-chomping Bay of Pigs veteran, Clines, 58, has been a close friend of Wilson since the early 1960s, when he served as Wilson's case officer in the agency's clandestine operations division. In the 1970s, he became director of training at the agency and then CIA liaison with the Pentagon. The close friendship continued; so did a penchant for borrowing money from Wilson.

Although much of Clines' involvement in the Iran- contra activities remains clouded, Albert Hakim, Secord's partner, testified recently that Clines was hired to aid in the arms sale to the contras. He played a large role in the shipment of weapons from Portugal, where he had many contacts, to the contras. Other reports also linked Clines to attempts at obtaining a ship to be used for several covert operations, including a mission off Cyprus that involved a million-dollar ransom payment to free U.S. hostages in Lebanon.

One of the people the committee staff saw privately about two weeks ago was Shirley Brill, 44, a 20-year CIA employee who had a close, live-in relationship with Clines from 1975 until 1981. Among the things she told them, and also stated in a sworn statement to her attorney, was that while Clines was with the agency--and especially after he left in 1978--someone was delivering to him at his apartment highly classified CIA documents. To hide the papers' secret status, she said, Clines and another longtime intelligence operative and Wilson associate, Raphael "Chi Chi" Quintero, would cut off the classification stamp. Quintero was also hired by North and Secord to coordinate the contra resupply flights to Nicaragua.

"I don't know where they got them," she said during an interview, "but I know they had classified documents and they would sit and cut the classifications off and it was not only secret and confidential, it was code word (the highest specification) material." She added that they burned the cut-off strips of paper that bore the classification stamps. "At one point they almost burned the house down because they put too much of it in the fireplace," she said. In a recent interview, Wilson also stated that he had seen classified documents in Clines' home after Clines left the CIA. "I went over there one day," said Wilson, "and he had a whole box of classified information."

Another area of committee concern is the Egyptian-American Transport Services Corp., or Eatsco, where Clines held a 49% interest and an Egyptian, Hussein Salem, held 51%. It was formed after the August, 1979, Camp David accords, to capture exclusive shipping rights for the billions of dollars worth of newly authorized military aid to Egypt. For years the company made tens of millions of dollars but in July, 1983, the company pleaded guilty to $8 million in billing fraud and Eatsco, Salem and Clines ultimately paid more than $3 million in fines and restitutions.

In his testimony before the committee, Secord denied any connection with Eatsco. But Brill had heard otherwise, saying that Clines had told her of Secord being one of the company's silent partners. At the time, Secord was head of military assistance and sales for the U.S. Air Force and in a key position to help the company. The other silent partners, Brill says Clines told her, were Wilson, former CIA official Theodore G. Shackley and Erich von Marbod, then-deputy director of the Defense Security Assistance Agency, the Pentagon's foreign-arms supplier.

Wilson also confirms Secord's role in Eatsco. "It was a five-way partnership," he said. "I got 20% for putting up the original $500,000 . . . they put up their contacts. I was the money man. Usually the money man gets 51% but in a situation like this, they all had jobs and they got a piece of the action." According to Wilson, Clines ran Eatsco while von Marbod and Secord made sure everything was shipped through the company.

Not only are many key players in North's covert network former Wilson associates but, in a sense, Wilson first came up with the secret contra plan. Part of the scam used by the Justice Department to trick Wilson out of Libya involved convincing him that the United States wanted his expertise in setting up a Caribbean and Central American intelligence operation. He drafted a plan, long before North formed his secret contra aid network, to carry out this mission.

Wilson's proposal, "Project X," ironically called for setting up a small, highly secret covert organization run directly out of the National Security Council. Although the plan was never put into effect, two years later North set in motion a similar program operated by Wilson's old network.

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