On this day in 1986, Attorney General Edwin Meese reported that the returns from the illegal weapons sold to Iran were diverted to the anti-communist Contras in Nicaragua. This happened three weeks after a Lebanese magazine exposed that the United States had been secretly selling arms to Iran.
The Lebanese magazine called "Ash" on November 3, reported that the United States had been selling weapons to Iran secretly in order to secure the release of seven American prisoners held by Iranian groups in Lebanon. This came as a surprise to officials that were not part of the inner caucus of President Ronald Reagan's administration and against the stated policy of the administration. This act contradicts the U.S. arms ban against Iran, and the weapon deals opposed President Reagan's stance on not negotiating with terrorist.
Controversy over Reagan's administration undisclosed dealings with Iran worsened when on November 25, Attorney General Meese reported that the proceeds from the weapons sold was redirected to sponsor Nicaraguan rebels "The Contras" who were fighting a guerrilla tactics war against the elected radical government of Nicaragua. This revelation caused uproar in the Congress who in 1982 passed the Boland Amendment barring the use of federal money "to fund the toppling of the Nicaraguan government."
On that same day, the Iran-Contra link was exposed, forcing President Reagan to receive the resignation of Vice Admiral John Poindexter, the government's national security adviser and fired Poindexter aide Lieutenant Colonel Oliver North. Both men played key parts in the Iran-Contra deal. President Reagan claimed responsibility for the sold arms deals in exchange for the U.S. prisoners but claimed not to be aware of any funds diversion to sponsor the Contras.
Lawrence Walsh was given orders to investigate the matter in December 1986, and in the late spring of 1987 Congress held a TV broadcast of the hearings on the Iran-Contra deal. The investigations uncovered that North and other officials in Reagan's administration had tried to conceal their unlawfully dealings with the Contras and Iran.
Investigations further revealed that eleven White House, State Department, and officials of the intelligence unit were found guilty on charges ranging from perjury, to withholding evidence from Congress, and plan to defraud United States. Walsh final report explained that neither President Reagan nor Vice President George Bush disregarded any laws regarding the affair, though Reagan had first set the path for the illegal acts whereby others follow suit by his continued support for the Contras even after Congress had banned it.
President George Bush gave presidential pardon to six people who played a major role in the Iran-Contra scandal when he lost his reelection bid to Bill Clinton on Christmas Eve in 1992. Out of the six was the former defense secretary Caspar Weinberger and former head of CIA operations Duane Clarridge, both had trails for fabrication of truth pending.