Shadowy Ex-Spy May Hold Key to Iran-Contra Riddle : Intelligence: The testimony of former secret agent Clair George could reveal CIA’s true role in the affair.

His life, until last week, could have been spun from the pages of a John le Carre novel.

Variously described as brilliant, witty, vain, impatient and--above all--brave, Clair George was the consummate spy, an engaging man who was just as familiar with the back alleys of Beirut as with the corridors of power in Washington.

George came up through the dark side of the Central Intelligence Agency--the part that spy novels romanticize and that congressional committees seek to scrutinize, usually with only limited success.

Apart from a brief, miscast stint as the agency’s congressional liaison in the early 1980s, George spent his 32-year career in the cloak-and-dagger world of clandestine operations, working his way up via dangerous assignments in Asia, Africa, the Middle East and Europe.

In 1984, he became deputy director of operations, with supervisory responsibility for all of the CIA’s covert activities.

Now, nearly three years after retiring from the agency’s No. 3 post, the man who moved in the shadows most of his adult life unexpectedly finds himself under intense scrutiny by prosecutors and congressional investigators.

At the age of 60, with his shock of bright red hair beginning to gray and his waistline finally betraying a lifelong passion for fine food, Clair Elroy George has suddenly become the key that could unlock the last secrets of the the Iran-Contra affair.

His testimony also could help defeat President Bush’s nomination of Deputy National Security Adviser Robert M. Gates to be the new director of the CIA.

George was Gates’ deputy at the CIA when the Iran-Contra scandal broke. Investigators already have determined that the late William J. Casey, who was CIA director then, was involved in the Iran-Contra affair.

But Senate investigators say George could be the key to deciding if there was involvement of other officials such as former Assistant Secretary of State Elliott Abrams and former Bush aide Donald P. Gregg, who is now ambassador to South Korea.

Despite heavy pressure from the White House, the Senate Intelligence Committee last week announced that it would delay planned confirmation hearings on Gates’ nomination while it seeks information from George and Alan D. Fiers. Fiers, former head of the agency’s Latin American division, last week admitted in court that he and other senior CIA officials knew about the Iran-Contra funds diversion months before it became public.

While George’s name is sprinkled throughout the voluminous transcripts of the Iran-Contra investigations, until recently he had escaped the attention of the Iran-Contra prosecutors led by independent counsel Lawrence E. Walsh.

George’s reputation had been tainted by the affair. His retirement in November, 1987, was viewed by many as involuntary.

However, unlike other CIA officers implicated in the Iran-Contra scandal, George was never formally rebuked for his directorate’s complicity in the illegal diversion of profits from the arms sales in Iran to the Contras in Nicaragua.

But the 4 1/2-year-long Iran-Contra investigation took a surprising turn last Tuesday with Fiers’ testimony.

George told Congress he had only learned of the diversion when it was announced by the attorney general’s office on Nov. 25, 1986.

But Fiers, as part of a plea bargain with prosecutors, testified he told George about the diversion months earlier. He indicated that George had already known about it--and subsequently instructed him to cover up the scandal by misleading Congress.

Now, Walsh’s staff is homing in on George in the hopes of finding out how many higher-ups in the CIA knew about and were involved in the worst scandal of the Ronald Reagan presidency.

George, who is married and lives in the Washington suburb of Bethesda, Md., is not taking calls from reporters these days.

But friends and colleagues paint a picture of a man despondent and deeply embittered by what George Carver, a former CIA official who is now with a Washington think tank, says is an attempt “to make him the ham in a political sandwich served to hungry politicians.”

Many former colleagues who know and sympathize with George seem to share a deeply cynical view that those implicated in Iran-Contra are guilty only of failing to avoid political snares.

“Clair is a fine person and an excellent officer who got caught in something political,” asserts one former CIA official who now works as a security consultant in the Washington area. “It’s disgusting what they are doing to him,” he said.

But other former agents suggest privately that there was a reckless side to George--one that disdained bureaucracy and often appeared contemptuous of the oversight that Congress has been trying to exercise over the agency since the mid-1970s.

“He was not very forthcoming as far as relations with Congress were concerned,” said Robert Simmons, a former staff director for the Senate Intelligence Committee who knew George when the CIA officer served as the agency’s congressional liaison in the mid-1980s.

“He had the same mind-set as Bill Casey,” Simmons said.

George left that job after it was proven that the CIA lied to Congress about its role in the mining of Nicaraguan harbors the year before.

Another former colleague notes that George “was always very independent in spirit.

“More than most in the agency,” the colleague said, “he had a sense of being himself without worrying too much about what the system was going to think of it. . . . He didn’t suffer fools gladly, and he was always impatient with bureaucratic procedures.”

Born in Beaver Falls, Pa., and a graduate of Penn State, George served with the Army in Korea and joined the CIA in 1955, at the height of the Cold War.

He cut his teeth in covert action in Hong Kong, Mali and India and was chief of station in Beirut at the start of the Lebanese civil war in 1975.

When the Athens station chief, Richard Welch, was assassinated later that year, George volunteered to replace him and did what Thomas Polgar, another senior operations officer now retired, said was “an absolutely brilliant job in what was a very difficult situation.”

Ranked by an internal agency review panel as No. 1 among CIA officers in line for promotion to “supergrade” status in January, 1978, George was brought back from Athens to become director of the CIA’s Africa division.

He was later appointed assistant deputy director for operations, a post he held until Casey named him congressional liaison in late 1983.

“He and Casey always got along real well together,” another colleague said. “Casey respected his brains, the breadth of his knowledge and his cynicism about how Washington works.”

But not everyone got along with George. In “The Spy Who Got Away,” author David Wise quotes one former CIA official as calling George “ruthless, cunning, ham-handed, contemptuous of his underlings, toadying to his superiors.”

Still, even George’s critics agree that he has a keen intellect and a fine wit that, in the words of one of his friends, “offset his impatience with people.”

Carver recalls that George also has been something of a bon vivant, who wears loud ties, likes to dine well and is “not above a libation or two slipping easily down his throat.”

“He was a great raconteur and an engaging companion,” Carver said.

Given his sense of irony, George may even grimly appreciate one parallel that his current dilemma bears to another national scandal a decade before--Watergate. Then-President Richard M. Nixon’s involvement was revealed through tapes he secretly made of his own conversations.

In the George case, it was the transcripts from a similar monitoring system used to record all conversations on secure phones between CIA headquarters and field stations that may have helped lead prosecutors to Fiers, who subsequently put them on to George.

Carver, who was with the agency when the taping system was installed, remembers that it was meant to ensure accountability by maintaining a taped record of all instructions sent to agents in the field.

The man who thought up the idea--and ordered that the monitoring system be installed--was Clair George.