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RIYADH: The 1986 Iran-Contra affair remains one of the most controversial episodes in modern US history, revealing a complex web of clandestine operations, legal violations and political intrigue. 

The scandal, which unfolded during Ronald Reagan’s presidency, revolved around covert sales of arms to Iran and the illegal diversion of the profits to fund right-wing Contra rebels in Nicaragua. It challenged the very principles of transparency, accountability and the rule of law in democratic governance. 

The backdrop to the events was shaped by Cold War tensions and volatile Middle Eastern geopolitics. On May 17, 1985, Graham Fuller, the CIA’s national intelligence officer for the Near East and South Asia, wrote a memorandum to CIA Director William Casey on the options for US policy toward Iran. 

“Events are moving largely against our interests, and we have few palatable alternatives. The US has almost no cards to play; the USSR has many,” Fuller wrote. 

To provide the US with “some leverage in the race for influence in Tehran,” Fuller suggested Washington should “remove all restrictions on sales — including military — to Iran.” 

In Nicaragua, meanwhile, the Sandinista government, which in 1979 overthrew a US-backed political system, aligned itself with socialist policies and the Soviet Union. This development alarmed the Reagan administration, which supported the Contra rebels, a group accused of widespread human rights abuses. 

Simultaneously, the US faced complex challenges in the Middle East. Iran was engaged in a protracted war with Iraq (1980-1988), and Washington sought to limit Soviet influence in the region while securing the release of US hostages held by pro-Iranian groups in Lebanon. 

Despite its public stance of refusal to negotiate with terrorists, and its own arms embargo on Tehran, the Reagan administration saw an opportunity to leverage arms sales as a means of influence. It wanted to secure the release of US hostages held by Hezbollah in Lebanon, and attempt to open a channel for dialogue with more-moderate elements in Iran. 

The Iran-Contra scandal involved two distinct yet interconnected operations. Firstly, senior US officials facilitated the secret sale of arms to Iran, ostensibly as a gesture of goodwill to moderate factions within the Iranian government and to secure the release of US hostages. This violated an arms embargo imposed by Washington on Iran, and contradicted Reagan’s public statements condemning terrorism. 

Secondly, profits from these arms sales were diverted to fund the Contras in Nicaragua. This contravened the Boland Amendment, a series of laws passed by Congress between 1982 and 1984 that explicitly prohibited US military assistance for the group. 

The plan was orchestrated by a small group of officials within the National Security Council, including Lt. Col. Oliver North, with the knowledge and support of senior figures such as National Security Advisor John Poindexter.  

At the same time, the CIA and the Department of Defense conducted Operation Tipped Kettle, which involved secret negotiations with Israel on the transfer of armaments captured from the Palestine Liberation Organization in Lebanon to the CIA and, ultimately, to the Contras. 

In May 1983, Israel duly handed over several hundred tonnes of weapons, valued at $10 million. This was repeated in 1984. 

In 1985, Israel began shipping US weapons to Iran, in an attempt to curry favor with Tehran and pave the way for the release of American hostages, with the approval of Poindexter’s predecessor as Reagan’s national security adviser, Robert McFarlane. 

On Nov. 2, 1986, within days of the delivery of 500 antitank missiles to Iran, US hostage David Jacobsen was released by his captors in Beirut. North anticipated the release of other hostages would follow but this did not happen. 

In response to media inquiries, White House Chief of Staff Donald Regan publicly acknowledged, for the first time, the ongoing negotiations with Iran. 

The Iran-Contra affair fully came to light in late 1986, after Lebanese publication Ash-Shiraa revealed details of the arms deals with Iran. On Nov. 3, 1986, it published an account of a secret visit to Tehran by McFarlane in May 1986. Subsequent investigations by journalists and Congressional committees uncovered the broader plan, which raised serious questions about executive overreach, the subversion of Congressional authority, and the ethical conduct of government officials. It sparked outrage among lawmakers and the public. 

Televised hearings in 1987 captivated the country, with key figures, including North, testifying about the operation. While some viewed North as a patriot simply following orders, others considered him emblematic of an administration willing to circumvent the law to achieve its goals. 

The hearings also revealed a culture of secrecy and deception within the Reagan administration, damaging the president’s credibility and eroding public trust in state institutions. 

The fallout from the Iran-Contra scandal included several criminal prosecutions. North, Poindexter and other officials were charged with crimes such as obstruction of justice, conspiracy and lying to Congress. 

The affair was also a major blow to the Reagan administration’s credibility. It raised questions about the extent of presidential knowledge and oversight, as Reagan maintained he was unaware of the transfer of funds to the Contras. Politically, the scandal tarnished his legacy, though his approval ratings remained high until the end of his presidency in 1989. 

The affair remains a cautionary tale about the dangers of unchecked executive power and the ethical dilemmas inherent in foreign policy. While it did not lead to lasting reforms in intelligence oversight, it did underscore the need for greater vigilance to prevent abuses of power, and serves as a case study in how the pursuit even of well-meaning objectives can result in unintended consequences if legal and ethical boundaries are crossed. 

• Dr. Mohammed Al-Sulami is head of the International Institute for Iranian Studies (Rasanah).