Lawrence Walsh : Iran-Contra Prosecutor Feels Pressure as Clock Runs Out

<i> Ronald J. Ostrow has covered the Justice Department for The Times since 1966, and began covering special prosecutors in 1973 when Archibald Cox took the job during Watergate. Ostrow interviewed Walsh in the independent counsel's conference room</i>

Despite the steam of a Washington summer, Lawrence E. Walsh shows not a wrinkle in his pin-collar shirt, dark tie and three-piece charcoal suit. He seems unchanged by the years. He still has the look of the highly successful 55-year-old Wall Street lawyer he was--23 years ago. Although facing imminent, crucial decisions as independent counsel prosecuting the Iran-Contra crimes, he talks of them with the tone and distance of a keen observer rather than a central participant.

The “backbone of steel” that one longtime colleague says runs through Walsh’s frame is covered by old-style courtliness, geniality and precision in responding to questions. Only occasionally does the hard core surface, as when Walsh explains why he won’t throw in the towel, despite receding public interest in the scandal that rocked the Reagan Administration, increased congressional criticism and a highly critical reversal on July 20 of former White House aide Oliver L. North’s conviction by a 2-1 vote of the U.S. Circuit Court of Appeals here.

That reversal represented a setback as dramatic as the milestone of the April conviction on all counts of North’s former superior, John M. Poindexter, President Reagan’s national security adviser. At this stage, Walsh won’t say whether and how he will appeal that ruling. But most legal observers believe he wants to go directly to the Supreme Court to prevent immunity granted during congressional hearings from giving witnesses a free pass from any future prosecution for their acts.

Walsh’s steel was tempered during the Great Depression when, fresh out of law school, he joined a state special prosecutor’s staff probing corruption among Brooklyn prosecutors. Then came more racket-busting and gangster-chasing as an assistant district attorney under the newly elected New York district attorney, Thomas E. Dewey. Later, he served Gov. Dewey as chief counsel in Albany and was the first director of the Waterfront Commission of New York Harbor.


A lifelong Republican, Walsh was named a federal judge by President Dwight D. Eisenhower, but stepped down after three years to become deputy attorney general under his colleague on the Dewey prosecution team, Atty. Gen. William P. Rogers. Then came the blue-chip private law practice in Manhattan for 20 years--and six-figure annual income--though he found time to serve as chairman of the American Bar Assn.'s judge evaluation panel and as ABA president.

In 1981, he left New York for Oklahoma City, his wife’s hometown. But he still handled cases coming from the East. He is now past the 3 1/2-year mark as independent counsel--a job Walsh had thought would take two years--and there is no end in sight. But he seems vitalized by the need to establish principle.

Question: Rep. William S. Broomfield (R-Mich.), a member of the former Iran-Contra Committee, has called for you to fold up the tent and end the investigation. Are you considering that?

Answer: It’s sort of an overhanging consideration and has been for some time. The alternatives are . . . to leave matters, not to conclude it; or to refer matters to the Department of Justice; or to have a new independent counsel take over these matters. Balancing these alternatives, we have concluded that the matters that we’re now working on are best handled by our continuation. If we tried to give them to someone else, there would be a substantial waste of accumulated education. And, second, they are still subject to the same sensitivity and potential appearance of conflict of interest that caused the original referral to this office. So although just about all of us would like to go to something else, we haven’t reached a point where we think we can do that with responsibility.


Q: Critics have said the effort here is really a left-right contest: What’s being re - fought here is the dispute over aid to the Nicaraguan rebels. How do you respond?

A: I don’t think there’s a left-right aspect to it. We think that our work, in addition to dealing with crime generally, has a particular importance because of its effect in preserving the checks and balances which the Constitution provides for and which are unique and essential to our form of government. It simply comes down to establishing illegal or criminal deception of Congress. That’s the central concern. That isn’t a left or right thing. It wouldn’t make any difference which party was in control of which branch. The two branches are a check upon each other, and all we’re interested in is establishing the precedent that false statements will not go unprosecuted.

Q: Should a precedent as important as that be established through the mechanism of an independent counsel rather than the regular prosecutive arm of government?

A: It seems to me it is very likely that it should. If there is a conflict (within) an Administration . . . and if there are several people holding high office in an Administration who are subjects of such an investigation, the whole idea of the independent-counsel statute was that this investigation be conducted by someone who is not affiliated with that Administration--whereas the attorney general, of course, is an important member of the Administration, regardless of his contact with the activities under investigation.


Q: Do you sense, though, that the American people seem barely interested in Iran-Contra these days? Whereas if you look back at the same juncture in Watergate, there was still a rather intense interest.

A: I try to remember Watergate. I don’t remember how long it went on, and even there I think there was a waning interest as it broke down into individualized prosecutions--important though they were. Lawyers followed them. But here, I’m continuously surprised by stray expressions of interest from just people I run into. They seem aware of the work, they’re very aware of the difficulty caused by the immunity grants and sort of give a sense that although it’s been drawn out they’d like it completed. Not abruptly terminated.

Q: Do you have any feeling that you are losing--to borrow the words of a former target of another special prosecutor--your political base, your political support?

A: No. Losing might be too strong a word. A gradual diminution, perhaps, because of the intrusion of other things. But it seems to me that the political base is, one, in the interest of the press; the interest of Congress, and third would be a more generalized interest of lawyers and the public. I haven’t felt a loss of interest. Indeed, with the (former National Security Adviser John M.) Poindexter conviction I had a feeling that it peaked up again.


Q: How has the reversal of the Oliver North conviction affected your office’s work? Is it such that you have to now concentrate on the appeal and forgo other prosecutions that you might have brought?

A: They’re not mutually inconsistent. There is an intense concentration on the opinion because we have to decide what to do in response to that, but the other work goes on, too. There’s some distraction from it because we’re not a large staff any more. If we concentrate on one thing we have to slight something else.

Q: At the time of the Poindexter conviction on all counts, you said that it probably would be fall before it was clear whether there would be additional charges, or whether you then would be shifting to concentrating on the final report. Does that timetable still hold?

A: This reversal may interrupt that by a diversion of manpower, or person power I should say. It doesn’t have to be taken into account as a matter of law on any of these matters, but it can have an indirect effect on them, I guess, in ways that I can’t describe without getting into matters that are internal to the investigation or the grand jury.


Q: Are there statute of limitations problems?

A: I don’t think there are any critical statute of limitations problems that we have to worry about.

Q: But there are some other problems you can’t get into because they would reveal the nature of the investigation?

A: Or witnesses or something like that.


Q: Has the North decision, the necessity of appealing or whatever you choose to do made it less likely that you will try to scrutinize the conduct of several executive-branch agencies that may have supported the work of the National Security Council in Iran-Contra?

A: It’s hard to give a categorical answer to that. Legally, it’s no impediment insofar as the subjects of these potential targets or these investigations or concerns. But as I indicated, there are matters that I can’t discuss where there might be an indirect effect.

Q: What comes to my mind when you mention that is the willingness of North to continue to go before a grand jury.

A: I can’t discuss that.


Q: When we talk about several executive-branch agencies that supported the work of the NSC in Iran-Contra, what we’re talking about is the CIA, the Defense Intelligence Agency and the FBI and the State Department and the Defense Department?

A: I think you left out one of the intelligence agencies.

Q: The National Security Agency.

A: When I talked about supporting agencies, those were the agencies that were generally in mind without attributing any misconduct to any of them.


Q: The diversion question--the diversion of funds from the Iran portion of the alleged conspiracy to support the Contras--seems to have taken a back seat in the investigation. Does this mean that you’ve sidestepped a central issue in the scandal?

A: It wasn’t a deliberate sidestep. It was a limitation of the trials that were forced upon us by the intelligence agencies, which claimed that information which the court held relevant could not be made available for the trial without identifiable danger to the national security. Those claims, for whatever they were worth, were supported by the attorney general, and there is no way the court can overrule that decision, nor can the independent counsel. So that was the reason the diversion wasn’t prosecuted publicly.

To say that it took a back seat is to overstate it. It’s always there as a dramatic indication of what can be concealed once we tolerate false statements to Congress. It was not just aid to the Contras that was concealed, or even attempts to release the hostages. There was a concept of covert action being carried out by private persons, without authorization or knowledge of Congress and without appropriation by Congress, using funds obtained from foreign countries or from private persons--but carried out under the aegis of executive-branch officials. So it’s never in a back seat. It’s a glaring example of an evil that becomes attainable if false statements to official inquiries by Congress are to be tolerated.

Q: Do you think this may be a tip of the iceberg? That this goes on in the executive branch’s relations with Congress and that it happens that your investigation has uncovered it and established it?


A: I think it’s important that we make certain distinctions. Having served in the executive branch of government, it’s very understandable that many things being done in the executive branch are not made public and are not disclosed to Congress voluntarily or even informally. And that in the informal give and take between Congress and executive branch officers there is a certain amount of horse-trading that’s gone on in which all the facts aren’t always stated accurately.

But when Congress, through its committee, formally makes an inquiry of the executive branch, or any officer of the executive branch, it’s acting under its oversight powers and its appropriations powers. It’s entitled then to an honest answer. If the executive branch feels an answer shouldn’t be given to Congress, it must claim its executive privilege and refuse to answer openly and take the consequences. Or it must tell the truth. It can’t lie to conceal something it doesn’t want to tell Congress and not be prosecuted for a crime. That’s our analysis.

Q: But doesn’t that ability to claim executive privilege then blunt what you’ve established here?

A: Whenever an executive officer--and there are very few who can claim it to begin with--but when that’s done, that is a public acknowledgement that they are unwilling to tell the facts and Congress may withhold support just on that basis. Congress at least is on notice that something is going on and the executive officer is unwilling to tell them about it. They may take the kind of action that Congress has available to it to protect against such undisclosed activities.


Q: In the wake of the Poindexter conviction, you spoke of a pattern of deceit being uncovered by your investigation. Deceit by whom against whom?

A: That’s one of the questions to which answers are still being sought. What I was saying was that in focusing narrowly on just who knew or didn’t know about the particular diversion in this case, it overnarrowed the inquiry. And a more appropriate question is that if Congress was being deceived, who were parties to this broader activity of deceit as distinguished from the narrower activity of the diversion itself.

Q: When you took this job on, you had already entered your 70s. Had you had any expectation that it would go on this long?

A: No, I thought it would be over in two years. And I think we might have made it if it hadn’t been for the delay of trying to get the Swiss records, and also the delay that came when Judge (Gerhard A.) Gesell severed the cases so that each defendant had to be tried separately. That added a full year. . . .


Q: Have you got any regrets about taking the job?

A: No, I’ve certainly found it stimulating. It may be exasperating, but it’s been a very interesting professional experience, if nothing else. I’ve had a good staff to work with. If you’re in your 70s, it’s very good to be surrounded by young lawyers who are hard working, to say nothing of the non-lawyers. (Laughter.)