return the money to the Contra slush fund. Suspi-
cious that the activity might not have official U.S. ap-
proval, Israel ceased its cooperation after three ship-
ments. As an alternate plan, the NSC approved the
direct sale of a massive amount of missiles and other
arms to Iran at greatly inflated prices. The proceeds
would go directly to the Contras without arousing
congressional suspicions. As a secondary motive,
it was believed that the arms shipments would gain
the cooperation of the Iranian Shiite government.
Six Americans were being held as hostages by the
Lebanese Shiite paramilitary group Hezbollah, and
members of the Reagan administration hoped that
Iran might pressure its fellow Shiites to release those
hostages.
Contragate Swings Open For a time, the covert
funding plan worked flawlessly. However, the down-
ing of a plane in Nicaragua that was carrying arms
for the Contras resulted in a Lebanese magazine
publishing a story on November 3, 1986, that arms
were being shipped to Iran in exchange for the re-
lease of the hostages held in Lebanon by Hezbollah.
Iran soon confirmed that it was receiving arms ship-
ments from the United States. President Reagan was
forced to give a televised address on November 13,
admitting that weapons were being supplied to Iran
but denying that the sales were made in return for
the exchange of hostages. Rather, he claimed that
they were designed simply to breed goodwill be-
tween the two nations—and that the best way for
Iran to demonstrate its goodwill would be to secure
the release of the hostages.
In the meantime, North and his secretary, Fawn
Hall, were busily shredding documents in their of-
fices. Finally, on November 21, the day in which
Admiral Poindexter submitted his resignation and
Lieutenant Colonel North was unceremoniously
fired, Attorney General Edwin Meese III revealed
that the purpose of selling arms to Iran was to create
funds to aid the Contras. As questions reverber-
ated through the press and congressional criticism
mounted, President Reagan created a presidential
commission headed by Senator John Tower. The
Tower Commission was to investigate the Iran-Contra
affair (which would come to be known as both
Contragate and Irangate, an allusion to the Water-
gate scandal of the previous decade). It was also
tasked with investigating the general operations of
the NSC. Meanwhile, a variety of congressional com-
mittees held hearings of their own. By the end of
1986, Lawrence E. Walsh was commissioned by Con-
gress as a special prosecutor with the power to inves-
tigate and prosecute crimes committed during theIran-Contra affair
The Tower Commission worked with consider-
able speed and completed its report on February 26,- Both North and Poindexter, as well as Defense
Secretary Caspar Weinberger, were severely criti-
cized for their roles in the affair. Reagan came under
criticism for not properly supervising the NSC. This
failure was blamed, however, on his general disen-
gagement from his administrative officials. Little was
said in the report about the former director of cen-
tral intelligence and then-vice president, George
H. W. Bush. One week after the issuance of the
Tower Report, President Reagan held a press confer-
ence in which he expressed his regrets for the Iran-
Contra affair. He admitted that covert arms sales had
taken place to create funds for the purchase of weap-
ons for the Contras. Indeed, of the $30 million paid
by Iran for weapons, $12 million had been returned
to the government and $18 million went to support
the Contras. He pointed to both Poindexter and
North as the individuals responsible for the opera-
tions. Both men were questioned extensively by Con-
gress during the summer of 1987, but they were
granted immunity in return for their testimony, as
Congress was seeking to establish the responsibility
of their superiors for the affair. The hearings were
nationally televised, and North in particular became
a media celebrity.
Indictment, Conviction, Absolution In 1988, North
was indicted by a grand jury on twelve counts and
was convicted of three. However, his convictions
were overturned on appeal. The prosecution claimed
that no information used in the trial had been
obtained from North’s testimony before Congress,
which would have been a violation of his immunity
deal. The appellate court, however, ruled that his na-
tionally televised testimony had tainted the prosecu-
tion irremediably, as there was no way to prove that
the jury had no access to the information revealed in
the congressional hearings or that the prosecution
had not used that information to develop its investi-
gation. Poindexter was convicted in 1990 of felonies
such as obstruction of justice, conspiracy, and lying
to Congress. His conviction was also overturned as a
result of his immunity deal and public testimony.530 Iran-Contra affair The Eighties in America