But Says He Won’t Let Possible Pardons or Adverse Rulings Deter Him : Walsh Faces Major Obstacles in Iran-Contra Inquiry

As Lawrence E. Walsh marks his first anniversary of probing the Iran-Contra affair, he still faces major obstacles in his investigation--varying from a possible presidential pardon of the principal targets in the case to an appellate court ruling that independent counsels are unconstitutional.

But Walsh said in an interview Thursday that he has put such potential setbacks out of mind, believing that “if you stay up all night worrying about that, you won’t go ahead.”

Walsh said a court-appointed outside prosecutor takes such possible adverse developments into account and added: “If that happens, what’s my reaction going to be? You figure it out and let it rest at that because there’s a limit to how fine-tuned you can make your reaction until you know exactly what happened.

“You don’t change course on the assumption that something might happen,” he said.

Won’t Discuss Pardons

Walsh refused to comment on what his reaction would be if President Reagan pardoned principals in his investigation, including former National Security Advisers Robert C. McFarlane and John M. Poindexter, ousted national security aide Oliver L. North and retired Air Force Maj. Gen. Richard V. Secord.

While the independent counsel maintained it would be “inappropriate” to discuss pardons, other legal authorities said that such action by Reagan would not shut down Walsh’s investigation.

Those pardoned could still be summoned before the federal grand jury Walsh is directing and could no longer invoke the Fifth Amendment privilege against self-incrimination to avoid answering questions about allegedly illegal activities for which they had been pardoned, one source said.

Moreover, the source noted, they could be held in contempt and jailed for refusing to testify and prosecuted for perjury for testifying falsely.

Purpose of Testimony

The purpose of questioning such principals would be to attempt to collect evidence against those higher up the ladder of authority as well as down it and to establish what criminal acts were committed.

Asked shortly before Thanksgiving whether he would pardon Poindexter and North, Reagan responded: “That’s a question no one can answer.”

Presidential pardons and sentence commutations have often been issued around the Christmas holiday, but White House spokesman Roman Popadiuk said Thursday: “As far as I know, no pardons are being considered.”

Besides the pardon issue, Walsh also faces the possibility of a court ruling that would declare unconstitutional the 1978 law under which independent counsels are appointed. The law, which provides for appointment of such special counsel by a federal court, has been challenged on grounds that only the executive branch can name prosecutors.

Partly Insulated

But Walsh appears at least partly insulated from any such ruling by the U.S. Circuit Court of Appeals because he has been granted a backup appointment by the Justice Department, an executive-branch agency.

The issue is still not dead, however, because North is challenging Walsh’s backup appointment in the Supreme Court.

And an adverse ruling by the appeals court--which is focusing on the appointment of Alexia Morrison, an independent counsel who did not accept a backup Justice Department appointment--could provide more ammunition for further court challenges by North’s lawyer, Brendan V. Sullivan Jr., who is regarded as one of Washington’s more aggressive, imaginative defense attorneys.

Barring such developments, Walsh is expected to seek a grand jury indictment by late February that will allege a far-reaching conspiracy to violate a congressional ban on military aid to the Nicaraguan rebels, to defraud the government and to obstruct justice.

No Comment on Charges

Walsh would not discuss the grand jury’s work or comment on the likelihood of charges, but the case was outlined by sources outside his office familiar with the investigation. Besides McFarlane, Poindexter, North, Secord and Albert A. Hakim, a business partner of Secord, several other people are likely to be charged, those sources said.

The timetable is based on Walsh’s acquisition last month of Swiss bank records he had long sought and which were said to provide “a gold mine” of information on the financial paper trail behind the Iran arms sales and the diversion of funds to the Contras.

Walsh’s timetable could change if any prospective defendants decide to plead guilty and cooperate with prosecutors in hopes of being treated leniently. But there is no sign that any are weighing such action, which would parallel breakthroughs that the Watergate prosecutors scored in their investigation.