PAPER SAYS POINDEXTER MAY LINK REAGAN TO FUNDS
President Reagan's denial that he
knew proceeds from Iran arms sales were diverted to Nicaraguan
contra rebels might be challenged by his former national
security adviser, according to the Washington Post.
    The paper said yesterday that John Poindexter, who resigned
last November when the illegal transfer of up to 20 mln dlrs
was disclosed, was ready to break the silence he has so far
maintained over the affair.
    The Post said he might tell a special Senate committee
investigating the Iran scandal that he told Reagan twice in
1986 that money from Iran sales was being used for aid to the
contras.
    It said the panel was considering granting Poindexter
immunity from prosecution over the fund diversion, which was
illegal under a Congressional ban in force at the time against
aid for the contras.
    Poindexter has so far invoked the Fifth Amendment to the
Constitution which protects people from giving evidence which
could be self-incriminating.
    Reagan has said he authorized the sale of arms to Iran in
the hope of establishing links with Iranian moderates, but has
denied knowing that proceeds were ending up in Nicaraguan rebel
hands.
    A White House spokesman had no comment on the Post story,
but David Abshire, who is coordinating White House handling of
the affair, said Reagan would never approve any illegal action.
    Abshire, on the CBS television show "Face the Nation," did
not comment directly on the Post story, but said: "He (Reagan)
is deeply honest, he is deeply dedicated, he tells the truth
and when he says he has no knowledge, he has no knowledge."
    The Post quoted a source close to Reagan as saying the
White House expected Poindexter "will say he had direction and
authority, directly or indirectly," from the president for the
diversion of funds.
    The paper said the former security adviser's testimony
could damage the president's claim he was unaware of the funds
diversion.
    It quoted a legal source as saying Poindexter and his
lawyers planned to contend that twice in 1986 he told Reagan
that the arms sales were generating money for the "contras."
    The paper quoted the source as saying Poindexter did not
tell Reagan there was an illegal diversion of funds, but that
help for the contras was "an ancillary benefit" of the sales.
    The Post's sources also said the Senate committee could
grant immunity from prosecution this month to Oliver North, who
was fired from the National Security Council on the same day
that Poindexter resigned.
 Reuter
