Walsh Tells of Exposure to Testimony : But Denies He Heard Iran-Contra Remarks Directly or in Whole

Independent prosecutor Lawrence E. Walsh said today he was inadvertently exposed to protected testimony given to Congress last summer by three key figures in the Iran-Contra scandal.

But Walsh, who is pursuing criminal cases in the foreign policy scandal, told a pretrial hearing before U.S. District Judge Gerhard A. Gesell that he never heard the testimony directly and was exposed only to “fragments.”

The independent prosecutor testified for several hours today at the first of what are expected to be protracted hearings into the question of the protected testimony.

On March 16, a federal grand jury hearing Walsh’s case returned indictments against former national security adviser John M. Poindexter; his former White House aide, Lt. Col. Oliver L. North; retired Air Force Maj. Gen. Richard V. Secord and his business partner, Albert A. Hakim.

Diversion of Profits

Secord and Hakim were North’s private operatives in the U.S. arms sales to Iran and the subsequent diversion of sales profits to the Nicaraguan Contra rebels.

The indictments charged the men with various counts of conspiracy to defraud the government and obstruction of justice.

All four men testified last summer to the select House-Senate committees investigating the Iran-Contra scandal. Under agreements with Walsh, the panels granted limited immunity from prosecution to Poindexter, North and Hakim, which prevented Walsh from using their congressional testimony against them in building his criminal case.

Secord, who was the first committee witness, did not ask for or receive immunity from prosecution.

Heart of Defense Case

The immunity question currently is at the heart of the defense case, in which the lawyers for the accused claim that the indictments are based at least in part on protected testimony. If defense lawyers prove their case, they can ask Gesell to quash the indictments in question.

Walsh said today he himself was exposed to “fragments” of summaries and references to the tainted testimony three times before and three times after the criminal indictments last month.

However, he said, “I was never exposed to the testimony itself, so far as I know,” and his office kept a record of the “inadvertent” exposures.

Gesell ordered that information brought forward for review because the defense is entitled to “determine the extent the system (in Walsh’s office) failed to work perfectly.”

Shunned News Reports

During the congressional hearings, Walsh and a large portion of his investigative staff refrained from seeing any news reports about protected testimony; several other staff members were designated to monitor the reports and thus were “tainted.”

Walsh said 67 support staff members had no prohibition on listening to or reading news reports on the hearings, but they were instructed not to “communicate anything” to staff members who were to avoid immunized testimony.

Earlier, Gesell--who presided 14 years ago over much of the Watergate case in court--ruled that defense lawyers could not call witnesses at Monday’s hearing because they ignored an April 13 order outlining the scope of the hearing.

Gesell told defense attorneys it “doesn’t make any difference to me” whether they want to be cooperative, “but the court’s orders are going to be complied with” and the hearing would proceed even in an “atmosphere of confrontation.”