Saudi Arms Link to Iraq Allowed : Mideast: Under Reagan and Bush, U.S. weapons were secretly provided to Baghdad, classified documents show. The White House kept Congress in the dark.

The Bush and Ronald Reagan administrations secretly allowed Saudi Arabia to provide American-made weapons to the Iraqi regime of Saddam Hussein and other nations over a period of almost 10 years in covert operations designed to sidestep legal restrictions imposed by Congress, according to classified documents.

Among other materiel, the Saudis transferred an undisclosed number of 2,000-pound American-made bombs to Iraq in 1986 and, after the end of the Persian Gulf War last year, allowed Syria and Bangladesh to take American-made weapons, according to classified documents and interviews.

The transfers were made with wink-and-nod approval from the White House beginning in the mid-1980s and continuing until last year, documents and sources close to the affair make clear, but Congress was not notified.

Under the federal Arms Export Control Act, the President is required to notify Congress when a foreign nation transfers American-supplied arms to a third country without formal U.S. authorization. Congress can retaliate by canceling future arms sales to the country or taking other punitive steps. Congress was not told about a number of the arms transfers by Saudi Arabia, sources say.

But classified government documents show that this notification was not provided because Reagan and Bush Administration officials feared it would lead to congressional opposition and upset other pending proposals for arms transfers to Saudi Arabia itself.

Two Administration officials acknowledged that the transfer of American arms and spare parts to Iraq by Saudi Arabia in the 1980s was part of a covert policy by the Reagan and Bush administrations to arm Iraq by sending U.S. arms to Arab allies who transferred them to Iraq.

The officials, who spoke on the condition their names be withheld, said notification of the transfers to Iraq might have led to disclosure of the covert authorization by the two administrations.

Authorizing Saudi Arabia to provide bombs to Iraq would have violated the Reagan Administration’s public policy of not sending weapons to Baghdad. It also would contradict numerous statements by officials of the Reagan and Bush administrations to Congress that such U.S.-origin munitions were not supplied to Iraq.

The new disclosures come in the midst of a high-level debate within the Bush Administration over whether to propose to Congress the sale of 72 F-15 fighter planes to Saudi Arabia. Earlier this month, 236 congressmen wrote President Bush opposing the proposed F-15 sale, saying it would fuel a new arms race in the Persian Gulf.

“The sale of additional F-15 aircraft to Saudi Arabia is incompatible with any meaningful arms control policy,” the congressmen wrote. “Such an F-15 sale would represent a significant escalation of the regional arms race.”

Since Iraq’s invasion of Kuwait in August of 1990, the Bush Administration has sold $14.8 billion in sophisticated arms to Saudi Arabia, ranging from Patriot missile batteries to fighter planes and tanks.

The transfer of bombs to Iraq was disclosed in a secret State Department cable in August, 1986. The cable said Prince Bandar ibn Sultan, the Saudi ambassador to the United States, had explained to U.S. officials that the Saudis had provided Iraq with the one-ton, MK-84 bombs.

In addition, classified U.S. intelligence reports show that Saudi Arabia transferred American-made armored vehicles to Syria without formal American approval after the end of the Gulf War, according to two sources familiar with the reports.

Last January, U.S. officials learned that Saudi Arabia also had provided American-made armored personnel carriers to Bangladesh after the war ended, according to classified documents and interviews. The disclosure came after the Bangladesh government asked U.S. authorities to provide spare parts for the carriers, according to documents.

A senior diplomatic official said the bombs were provided to Iraq with informal approval of U.S. authorities as part of the joint U.S.-Saudi effort to keep Iraq armed and fighting during the Iran-Iraq War.

The official said troops from Syria and Bangladesh were allowed to retain American-made vehicles they had used in fighting as part of the allied coalition in the Gulf War with the approval of U.S. military authorities.

Attempts to obtain comment from the Saudi Embassy in Washington were unsuccessful. A spokesman at the State Department declined to comment.

The new disclosure of Saudi transfers to Iraq, Syria and Bangladesh follows recent reports that Israel sold American weapons to third countries without U.S. approval.

On April 1, the State Department’s inspector general made public a report charging that Israel had potentially violated the Arms Export Control Act through “sales of sensitive U.S. items and technology to countries prohibited by U.S. law from receiving such items.”

The report said the violations “show a systematic and growing pattern of unauthorized transfers by (Israel) dating back to about 1983.” It also said the Reagan and Bush administrations did not inform Congress of the potential violations by Israel, as required by law.

In the earliest instances of Saudi Arabia’s transfers to Iraq, the Reagan Administration also took no steps to provide formal notification to Congress, though the Administration possessed detailed information about the incident involving the MK-84 bombs, according to classified documents and interviews.

At the time, the Reagan Administration was about to begin delivery to Saudi Arabia of five sophisticated airborne radar and command planes known as AWACS worth $3.5 billion. Administration officials feared the unauthorized transfer of bombs to Iraq would jeopardize the sale.

The secret 1986 State Department cable reported that Bandar had acknowledged that the Saudis had transferred “U.S. origin MK-84 bombs to Iraq.”

The cable admonished officials in Washington: “Whatever the explanation for this transfer, we are required by the Arms Export Control Act to report promptly--repeat promptly--to Congress upon receipt of information that such an unauthorized transfer may have taken place. We shall be forwarding such notification in the next few days in classified letters to the Speaker of the House and the chairman of the Senate Foreign Relations Committee.”

But a senior staff member of the Senate Foreign Relations committee said last week that a thorough review of the committee’s records turned up no such notification of the arms transfer from Saudi Arabia to Iraq.

Only two months before Bandar’s admission, the Senate had sustained by a single vote President Reagan’s veto of legislation that would have blocked a $265-million weapons sale to Saudi Arabia. At the same time, Reagan had notified Congress that he intended to begin transferring the first of five AWACS planes the Saudis had bought from the United States in 1981.

Congress had only approved the $3.5-billion sale of the AWACS after the Saudis agreed not to transfer sensitive U.S. military hardware and technology to other nations.

Disclosure of Saudi transfers of American-made arms to Iraq would almost have certainly led to congressional opposition of the delivery of the AWACS, a former Reagan Administration official said in a recent interview.

Indeed, the secret State Department cable warned of political fallout, saying: “We are concerned, naturally, about possible reactions to this unauthorized transfer.”

The secret cable also warned that Congress could use the transfer to declare Saudi Arabia ineligible to buy American military goods, noting that the Arms Export Control Act provides Congress with the opportunity “by joint resolution, to declare a country ineligible for” further U.S. military sales. “This is a possibility we must treat seriously given the previous debate on arms sales.”

A number of former and current Administration officials said monitoring of arms transfers by recipient countries has not been strict because some countries transferred the weapons with the secret approval to carry out covert foreign policy initiatives.

Israel, for example, sold hundreds of millions of dollars of arms to Iran throughout the Reagan presidency as part of a covert policy to gain influence in Iran and obtain the release of Western hostages.

Similarly, Saudi Arabia transferred arms to Iraq as part of a covert policy by both the Reagan and Bush administrations to arm Iraq during the Iran-Iraq War and after the end of the war in the summer of 1988, according to some officials.

Proposals to arm Iraq through American allies in the Middle East originated in 1982 with Jordan’s King Hussein, an ally of Iraq who feared an Iranian victory during the Iran-Iraq War, classified State Department cables indicate.

In a classified October, 1983, State Department cable, William L. Eagleton, then the senior U.S. diplomat in Baghdad, recommended to his superiors: “We can selectively lift restrictions on third-party transfers of U.S.-licensed military equipment to Iraq.”

Eagleton was initially told that his proposal could not become official policy because of legal restrictions as well as potential opposition by members of Congress. But The Times reported in February that classified documents showed that the Reagan Administration later began a covert campaign to ship U.S. arms to Iraq through Arab nations allied with the U.S. in the Middle East.

Three countries were identified as the conduits--Egypt, Jordan and Kuwait. A New York Times account last January also identified Saudi Arabia as being involved in the covert program.

Other efforts by the United States to encourage Arab allies to arm Iraq are detailed in other classified records obtained by the Los Angeles Times.

For instance, Richard Murphy, then assistant secretary of state for Near Eastern and South Asian affairs, wrote in a 1984 secret cable that Egypt could be used to transfer its Soviet tanks to Iraq in exchange for selling new U.S. tanks to Egypt.

The covert policy to arm Iraq through Arab allies continued after George Bush was elected President, according to documents and interviews.

Waas is a special correspondent and Frantz is a Times staff writer. Times researcher Aleta Embrey contributed to this story.