1991 Congressional Hearings
Intelligence and Security


[Page: S14799]

From the Washington Post, Sept. 7, 1991


Ex-CIA Covert Chief Indicted


Clair E. George, former chief of the CIA's covert operations directorate, was indicted yesterday on 10 felony counts accusing him of lying and obstructing congressional as well as grand jury investigations of the Iran-contra scandal.

A federal grand jury returned the indictment after a closed session with prosecutors from Independent Counsel Lawrence E. Walsh's office that lasted almost six hours. The charges were leveled little more than a month before a five-year statute of limitations would have started to come into play, barring prosecution of most of them. Each of the counts carries a maximum penalty of five years in prison and fines of $250,000.

George, 60, is the highest-ranking CIA veteran to be indicted in Walsh's re-energized investigation into the involvement of agency officials in efforts to cover up the Iran-contra scandal.

In a statement issued by his lawyer, George, now a security consultant after 32 years at the CIA, vowed to contest the charges vigorously. Later, he appeared on the front lawn of his Bethesda house and called himself `a pawn in a continuous drama of political exploitation.'

A major portion of the indictment rests on the testimony of Alan D. Fiers, former chief of the CIA's Central American task force and a one-time top deputy of George. In July, Fiers surprised prosecutors when he agreed to plead guilty to two counts of illegally withholding information from Congress and pledged to cooperate fully in winding up Walsh's 4 1/2 year investigation.

Prosecutors had hoped, in turn, to be able to get George's cooperation in moving against higher-ups who might have been involved in illegally covering up the Reagan administration's worst scandal. According to informed sources, George notified Walsh's office Thursday that he would not cooperate.

George's lawyer, Richard Hibey, said yesterday, `this prosecution should never have been brought' and went on to describe George's past contributions to the nation's security. Hinting at the kind of defense he plans to make. Hibey said George has `risked his life' and `has not profited one iota' from his service with the CIA. Echoing a theme that has been raised before on behalf of other Iran-contra defendants, the lawyer asserted that George was a victim of `complex and tortuous policy differences between Congress and the Executive Branch.'

Eight of the 10 charges against George stem from allegedly false testimony he gave to three congressional committees that were investigating early elements of what turned out to be the Iran-contra scandal. The last two counts charge that George lied again in an appearance last April before the federal grand jury and thus attempted to obstruct justice.

As deputy director for operations, George was one of the agency's top four officials and had charge of the CIA's worldwide activities in covert action, intelligence collection and counterintelligence. A favorite of the late CIA director William J. Casey, he held the post from 1984 until December 1987 when he was allowed to resign following criticism of his Iran-contra role by House and Senate investigating committees.

The first three counts against George involve a Senate Foreign Relations Committee hearing on Oct. 10, 1986, which inquired about the CIA's knowledge of the shootdown five days earlier of an aircraft carrying military supplies for contra rebels operating in Nicaragua.

According to the indictment, George ordered Fiers the day before that hearing to make changes in a draft of George's opening statement in order to prevent disclosure of the role that then-White House aide Oliver L. North was playing in the contra resupply effort.

The grand jury also accused George of lying about his knowledge of other Americans involved in the resupply effort, including retired Air Force Maj. Gen. Richard V. Secord, who played a role in both the resupply effort and the covert sale of U.S. arms to Iran.

Asked about U.S. citizens who were supporting the resupply flights for the contras, George told senators at the closed hearing that `we were not aware of their identities.' But according to yesterday's indictment, George had met Secord in a high-level staff meeting in the White House Situation Room on Jan. 20, 1986, and knew that Secord was involved with North `in efforts on behalf of the contras.'

The next three counts deal with George's appearance on Oct. 14, 1986, before the House intelligence committee which was also investigating the Oct. 5 shootdown. The indictment accused George again of obstructing a congressional inquiry and making two false statements about his knowledge of individuals involved in the resupply effort.

The third congressional hearing cited in the indictment was held Dec. 3, 1986, by the Senate intelligence committee. There, George was questioned specifically about Secord and said he could not tell the committee what role the general played in the resupply operation.

But the indictment said George had complained about Secord's involvement in the `Iran initiative' to both Casey and to then-White House national security adviser John M. Poindexter shortly after the Jan. 20 meeting with the general.

George is also charged with impeding the investigation by not disclosing that he knew of the diversion of Iranian arms sales profits to the contra cause before the diversion was publicly disclosed on Nov. 25, 1986. Fiers, in pleading guilty last July, said that he told George of the diversion in the late summer of 1986 after being told about it by North.

Another two counts against George involve his repeating to the grand jury some of the alleged false statements he first made at the Oct. 10, 1986, Senate hearing.



[Page: S14800]

From the Washington Post, Oct. 10, 1990


CIA Deputy Director Linked to Iran Arms, Testimony Shows


Thomas A. Twetton, recently named as the Central Intelligence Agency's deputy director for operations, was deeply involved in the secret arms-for-hostages dealing with Iran, according to testimony before the congressional Iran-contra committees and former CIA officials.

Twetton, who in 1985 and 1986 was deputy and then chief of covert activities for the CIA's Near East division, dealt regularly with former White House aide Oliver L. North as the agency `case officer,' handling the logistics and funds for the initial transfer of U.S. arms to Iran.

Twetton's 1987 testimony before congressional Iran-contra investigators was released to the public in 1988, but his name was deleted from the published version because he held a covert operations position. He was identified only by the abbreviation `C/NE,' representing his job at the time as chief of the Near East division.

In his testimony Twetton outlined how he:

Worked to try to prevent then-CIA director William J. Casey from getting involved in an arms-for-hostages scheme using Iranian middleman Manucher Ghorbanifar in the summer of 1985.

Informed North in September 1985 of Ghorbanifar's questionable record in CIA's files.

At North's direction, set up with the Pentagon in January 1986 the first shipments of U.S. TOW antitank missiles that were to gain release of U.S. hostages held in Beirut.

Carried North's message to the Defense Department that the price for each weapon should come down from $6,000 to $3,000 apiece.

Was with North and others when they met with Iranian middlemen in February 1986 in Frankfurt, March 1986 in Paris and April 1986 in Washington.

Briefed former White House national security adviser Robert C. McFarlane prior to McFarlane's secret trip to Tehran in May 1986.

Knew of the overlap that North created by using retired Maj. Gen. Richard V. Secord and businessman Albert Hakim in both the Iran arms sales and aid to the Nicaraguan rebels in Central America.

Twetton testified that although he was aware that excess money was being generated by the arms sales, `it never occurred to me . . . that North was raking it off [for the contras]. That was beyond the pale.'

Twetton's promotion, announced last month and effective Jan. 1, is not subject to Senate approval.

Robert M. Gates, who was Casey's deputy at the CIA for most of the Iran-contra affair, failed to get Senate approval to the Casey's successor, but was named by Bush as deputy national security adviser in the White House.

A handful of other CIA officials, linked to questioned contra activities, took early retirement or were penalized with reprimands or forced retirement when William H. Webster took over as CIA director.

Twetton's Iran-contra committee testimony includes several instances where he could not recall events that are still subject to dispute.

He could not, for example, remember a memo written by a CIA colleague in March 1986 that described how Ghorbanifar told North that the Iranian arms sales could be used in Central America for the Nicaraguan rebels.

`Well,' Twetton said upon being shown the memo. `I don't know whether I saw that or not. If I had, I assure you that I would have regarded it like everything else that Ghorbanifar said.'

Twetton also testified that he never tried to find out what caused the wide difference in the price charged the Iranians, about $20.5 million for weapons that had cost the CIA $6.5 million.

In the CIA announcement of Twetton's appointment, Webster said he was `very pleased that Tom has accepted this appointment. He has a very distinguished record of service, and I'm fully confident that he will do an outstanding job in leading the operations directorate.'



From the Washington Post, Jan. 8, 1987


CIA Sought Retroactive Approval


In late November 1985, CIA Director William J. Casey and his general counsel, Stanley Sporkin, proposed to the White House an intelligence authorization that would retroactively legalize any `prior actions taken by government officials' in the secret sale of weapons to Iran, according to two sources who have read the document.

When asked by the Senate Select Committee on Intelligence in a recent closed hearing about the legal reasoning behind the Central Intelligence Agency's proposal, Sporkin testified that the president has constitutional powers to grant pardons and therefore could declare an action legal after the fact.

Sporkin, now a U.S. District Court judge here, confirmed last night in a telephone interview that he had written such a draft intelligence order. `I was given fragmentary information at the time which led me to the conclusion that we needed a presidential finding to authorize the agency's activity, and ratify all action that had been carried out,' he said.

Sources said Sporkin testified before the Senate intelligence committee that it was not unusual in the corporate world for someone in authority to bless an activity retroactively. The alternative, Sporkin told the committee, would be to back date documents, which Sporkin said he would consider improper.

The proposed `finding,' as a presidential authorization for an intelligence action is officially known, was sent by Casey to Vice Adm. John M. Poindexter, who was then deputy national security adviser.

President Reagan never signed this draft; a revised version dated Jan. 17, 1986, was signed by the president, secretly authorizing the sale of U.S. weapons to Iran and ordering the CIA not to disclose the operation to Congress, which did'nt learn of it until last November.

Retroactive approval was not included in the Jan. 17 finding that Reagan signed, sources said.

Sporkin's draft finding regarding Iranian arms transactions was a one-page order dated Nov. 25, 1985, which said that `prior actions taken by government officials are hereby ratified.' The document was drafted after then-CIA Deputy Director John N. McMahon discovered that the agency had provided assistance to Lt. Col. Oliver L. North, then a staff aide of the National Security Council, in shipping missile parts to Iran as part of an attempt to free American hostages held in Lebanon.

U.S.-made missiles had first been shipped to Iran by Israel with secret White House approval in September 1985. Subsequent shipments of more than 2,000 TOW antitank missiles were made in 1986 until the operation was publicly disclosed last November.

The draft order written by Sporkin--which is documented in a lengthy but still unreleased report of the Senate intelligence committee--was indicative of what one former CIA official yesterday described as `bad legal advice' provided to Casey by Sporkin and the CIA general counsel's office during the early months of the Iran operation.

Sporkin testified that he wanted to ensure that the CIA was properly protected legally because he understood that the assistance provided North had been authorized by the White House and conformed with Reagan's wishes, according to informed sources. It is unclear whether Casey, who is recuperating from recent brain tumor surgery, was questioned about the document when he appeared before the Senate committee.

It was also learned yesterday that CIA officials at the operational level had `clues' earlier than has been publicly acknowledged that money generated from U.S. arms sales to Iran was moving into nonagency accounts abroad.

A former CIA official who has seen the stacks of documents and testimony provided to the Senate committee, said, however, that there was no indication in this record that the CIA was involved in the diversion of the funds or that intelligence officials knew that the money was being diverted to aid the contra rebels fighting the government of Nicaragua, as Attorney General Edwin Meese III said in November.

`Every so often there would be a glimpse of money moving into accounts other than CIA accounts,' the former agency official said. `They knew that outside the government, money was going somewhere.'

Information available up to now has suggested that the CIA's first knowledge that funds were being diverted abroad through the arms sales to Iran came early last October. Casey said last month that his first tip about this occurred at that time, when a Canadian business acquaintance, Roy Furmark, told him some of the profits earned by middlemen involved in the arms sales may have been diverted to aid the contras.

The CIA's role in the secret shipment of U.S. arms to Iran in 1985 and 1986 is detailed in the Senate committee's declassified report. On Monday, the report was caught up in partisan wrangling in the Senate, when Republicans on the intelligence committee were unable to muster enough votes to force its release, despite a plea from the White House..

Overall, according to the source, the report depicts the CIA, as too passive in not maintaining control of U.S. covert operations and relinquishing some of that responsibility to the National Security Council staff. Once Casey gave his backing to the Iranian initiative, the agency began to play an active supporting role.

The Senate report portrays the agency as providing logistical backup, such as setting up bank accounts into which money to reimburse the U.S. government could be paid, but apparently not raising serious questions about the NSC's covert program until at least the middle of 1986.

The agency's role in the covert Iranian program will be a prime focus of the coming House and Senate special inquiries into the Iran arms sales-contra aid affair. Under the 1989 law that gives Congress oversight of covert actions, the CIA is supposed to provide timely notification of all such clandestine operations; there has been bipartisan criticism of the administration in this episode for at least 10 minutes.

Accordingly to one source familiar with the Senate committee's report, the panel did not determine what happened to the funds raised privately on behalf of the contras. One reason was that the CIA was cut out of this knowledge under the system of middlemen through which the NSC carried out the arms sales to Iran.



[Page: S14801]

From the Washington Post, June 25, 1987


The Takeover of Stanley Sporkin


Fans of Stanley Sporkin during his time as the Securities and Exchange Commission's chief enforcer often wondered what happened to him after he followed William J. Casey over the river to Langley and became general counsel for the CIA.

Now, thanks to the Iran-contra hearings, they know more. Among other things in his days with the spooks, he took orders from Ollie North. Sporkin didn't blink an eye when in January 1986 North called him up and told him to stitch up an `expanded finding' on the arms sales to Iran.

Sporkin, a voluble and assertive man, whose name struck terror into malefactors in Wall Street, was cordially hated as a meddler, a stickler and a menace. His tenacity and zest for hounding people who jiggled their accounts and bribed their customers made him an ogre in the takeover set.

But Sporkin, who left the Central Intelligence Agency last year to become a federal judge, seems to have loosened up considerably at Langley. When he was leaving the SEC, there was much speculation that a man who had spent 20 years training bright lights on dark corners of American business would be out of sync with an agency that operates in secrecy.

Known as a liberal Democrat with a strict Republican view of law and order, Sporkin once said that `morality was going the way of detente.'

But he fitted in with the spooks better than anyone could have thought.

When, for instance, he was told on Nov. 25, 1985, that the Reagan administration was covertly selling arms to the ayatollah--and, in fact, had sent two batches--the only thing he thought of was that `this kind of activity . . . should have a finding by the president.'

A finding, he explained to the committees, `is a determination by the president of the U.S. that a certain activity in a foreign country, which is undisclosed, is necessary in the interest of national security.'

Not everyone in his then-new circle felt that a finding was necessary. There was no argument, of course, on not notifying Congress.

`It was stiff legal advice, believe me,' said Sporkin. He added with some complacency, `It's not the everyday legal advice I gave.'

It certainly wasn't the kind of advice he gave when he was reading the riot act to greedy brokers. But by Langley standards, apparently, it was tough stuff, and Sporkin saw himself at the barricades. `Some people think I might have pulled the trigger too soon.'

The committee lawyer who questioned him, Tim Woodcock, pointed out that the Hughes-Ryan law, which even spies are supposed to observe, calls for presidential approval of a covert action before it actually occurs.

Sporkin, who spoke in the loudest voice yet heard in the hearing room, obviously thought that the counsel was being picky and just a little bit unrealistic: `Well, I think it is important, obviously, in the perfect world. . . . to have the president authorize it, everything, in writing beforehand.'

But he didn't `flyspeck' it, and he retroactively authorized the third shipment, which had occurred within hours of his decision on the finding.

Sen. William S. Cohen (R-Maine) said that he had backdated the ratification of something that occurred without a presidential finding.

Said Sporkin, showing the cavalier spirit that informed the North-Casey orbit: `You can't straitjacket the president. . . . Someone can go out and do it, and later on you can do the paperwork.' Strains of Fawn Hall's seminal declaration that `sometimes you have to go above the written law.'

Sporkin gave the committee its second glimpse of backdating in 48 hours. The day before, another ex-official of the CIA had been on the stand telling how he had backdated two bills for North's security system.

The bill had already been paid by sorcerer North's apprentice, Richard V. Secord, but Glenn A. Robinette, a veteran of 20 years' service at Langley, didn't quibble. Without hesitating, he sent out two bills dated at appropriate intervals and got in return two fanciful missives from North, one typed on a machine that had its letters filed down to show the passing of time.

Robinette, who has an aureole of white hair and watery blue eyes, is the antithesis of Sporkin, being small, meek in manner and almost inaudible.

In the end, though, they sounded much the same. There was the same rueful, limited, situational contrition.

Asked if he did the right thing, Robinette said, `In sending the bills to Col. North? No, I wouldn't be sitting here. . . .' His voice trailed off.

Invited to voice second thoughts, Sporkin replied with a nervous laugh, `If this is what it has caused, obviously that is an easy decision.'

There must be something in the air at Langley.



From the New York Times, July 19, 1981


A Departure Leaves Few Regrets at the C.I.A.


Washington.--At the end of June, expressing confidence that his stewardship of the Central Intelligence Agency was progressing smoothly. Director William J. Casey sent a memorandum to all employees, notifying them that the agency was lowering its public profile. `The difficulties of the past decade are behind us,' Mr. Casey said.

He had spoken too soon. In a sudden upheaval last week, the director of clandestine operations, Max C. Hugel, was forced to resign amid charges that he had participated in fraudulent securities transactions when he managed an electronics business in the 1970's. Mr. Hugel called the allegations `unfounded, unproven and untrue.'

To many, the sudden departure of Mr. Hugel was a relief of sorts. By most accounts, he had disrupted the agency since arriving there in January as a special assistant to Mr. Casey. For some C.I.A. officials, Mr. Hugel's appointment, after his stint as a lieutenant in Mr. Regan's election campaign, raised questions about political directions the agency might be taking. Mr. Casey, before being named Director of Central Intelligence, managed Mr. Reagan's presidential campaign.

Even before his resignation, Mr. Hugel had been blamed for damaging the agency's relations with Congress and with foreign intelligence services. `Max Hugel was the wrong man for the job,' said one member of the Senate Intelligence Committee. `Every time he came up here for executive sessions, he seemed to lack a grasp of his business.' Consequently, Mr. Hugel won't be missed by many within the agency and on Capitol Hill.

The securities fraud charges, made by two former business associates of Mr. Hugel, did not involve any wrongdoing while he was at the intelligence agency. But there was some concern about the combination of the Hugel affair and disclosures last week that a Federal judge, ruling on an old lawsuit, had found that Mr. Casey had once knowingly misled investors in a business that went bankrupt in 1981. `If Casey's effectiveness is hurt,' said one official, `and he loses influence at the White House and on the Hill, then it's clearly a serious setback to the rebuilding of the agency.'


With the exception of Watergate-related abuses, including President Nixon's use of the C.I.A. to thwart Federal investigations of the original burglary at Democratic National Committee headquarters, the agency has remained relatively aloof from domestic politics. When Mr. Casey named Mr. Hugel Deputy Director for Operations, making him responsible for managing clandestine and covert operations, it appeared to some officials that the political contamination had spread to the agency's uppermost sanctum.

The timing could not have been worse. After taking over the C.I.A., Mr. Casey made the rebuilding of its clandestine services his highest priority. All the collection of intelligence by human agents, including American `moles' inside enemy governments, and covert actions by American agents, fall within the purview of the operations division.

The division has been drawn down over the years by budget cuts and has been plagued by a continual crisis of confidence that began in the mid-1970's with Congressional investigations that disclosed the use of violent and bizarre operations, including the assassination of foreign leaders.

Mr. Casey apparently thought that Mr. Hugel, a brash, hard-driving dealmaker, possessed the right qualities to inject efficiency and imagination into the clandestine services. Moreover, Mr. Hugel was unswervingly loyal to Mr. Casey. Colleagues described their relationship as much like that between a father and son.

Privately and publicly, Mr. Casey was an enthusiastic supporter of Mr. Hugel, repeatedly praising his deputy's abilities. `Bill thought Max would be great at developing and running covert operations,' said an intelligence official. `He forgot that half of Max's duties would involve dealing with Congress and foreign services. In the latter, his personal style couldn't have been less helpful.'

Mr. Hugel's tenure coupled with the manner of his departure, probably set back the operations division, officials at the agency said. Morale may be bucked up, however, by the rapid appointment last week of John H. Stein, a well-regarded agency veteran, as Mr. Hugel's replacement.

Liaison with foreign services has also suffered. Long distrustful of the C.I.A. because of uneven leadership and seemingly constant leaks of information, foreign intelligence agencies were apparently appalled at Mr. Hugel's lack of experience and finesse. Several Israeli officials were so shaken by their first encounter with Mr. Hugel, officials said, that they refused to provide him with the identities of colleagues in Israeli intelligence.

For some members of Congress, the Hugel affair has reawakened concerns about the management of the C.I.A. and prompted discussion about reasserting Congressional oversight. In recent years, the Senate Intelligence Committee has backed away from the kind of intense oversight favored in the period following the disclosure of C.I.A. abuses.

The departure of Mr. Hugel, once the controversy subsides, could ultimately work in Mr. Casey's favor. Assuming he survives the fallout, and recovers any influence lost at the White House and Congress, Mr. Casey may be better able to advance the agency's interests without the distraction and irritation generated by Mr. Hugel.

For example, Mr. Casey and Admiral Bobby R. Inman, the Deputy Director of Central Intelligence, have struggled for several months to gain agreement from other agencies and the White House on a new executive order to govern the activities of United States intelligence services. The issue, officials said, has often pitted C.I.A. leadership against the White House's National Security Council staff, with the C.I.A. generally favoring continuation of prohibitions against domestic spying, according to White House aides.

Mr. Casey has also attempted to improve the quality of intelligence analysis after discovering that many of his agency's analysts neither know the languages of the countries they watch nor have traveled to those countries.

For the moment, however, the main concern for officials at the agency's headquarters in Langely, Va., is to get the Hugel affair behind them. `Everybody, especially Bill Casey, is a little dazed,' said one official.



[Page: S14802]

From the New York Times, July 15, 1981


Ex-C.I.A. Deputy Is Viewed As lacking Professionalism


Washington, July 14: Before his resignation today, Max C. Hugel was in charge of the largest directorate in the Central Intelligence Agency, the branch responsible for covert action and clandestine counterintelligence overseas.

Mr. Hugel did not fit the mold for that job in two respects: He had not had a career in professional intelligence work; instead, he had been a businessman in New Hampshire and worked on the Reagan campaign staff in last year's Presidential election. And, unlike most of his predecessors, he did not come from an Ivy league-style `gentleman's club' background.

Mr. Hugel's title was Deputy Director for Operations. Before March 1973, the job bore the title of Deputy Director for plans. William E. Colby, who held the portion in 1973 before he became Director of Central Intelligence, said in an interview today that he had asked James R. Schleginger, then Director of Central Intelligence, to change the name because `plans' was a euphemism for what that part of the agency really did.

Besides Mr. Colby, two other men who had previously been in charge of the directorate for plans, or operations, were promoted from within the agency to Directors of Central Intelligence. They were Allen W. Dulles and Richard Helms. Mr. Dulles and Mr. Colby were graduates of Princton, and Mr. Helms was a graduate of Williams College, an old liberal arts college in north western Massachusetts.


`It would be very unusual to have a nonprofessional, a businessman, an ordinary civilian running the directorate for operations,' and Thomas Powers, author of a recent biography of Mr. Helms. `That's certainly never happened before. That's one position where you want a professional. That's where the heart of the agency always was, and that's the office in which Presidents were always most interested.'

President took an interest in the office because its covert agents could, at the President's behest, forment unrest in foreign countries. In addition, the Deputy Director for Operations supervised the recruitment of spies overseas, collecting minutely detailed information about low-level clerks in Soviet embassies aboard.

The Deputy Director also had authority over counterintelligence operations designed to learn about Soviet activities in general, and supervised all forms of psychological warfare conducted and information disseminated by the agency overseas.

Officials in the Reagan Administration said that William J. Casey, the Director of Central Intelligence, had recruited Mr. Hugel because Mr. Casey thought his rough-and-tumble style was exactly what was needed to rebuild the clandestine service. Some agency officials had become extremely cautious about conducting covert operations after years of Congressional investigations exposing unsuccessful and aborted projects, including plans to assassinate foreign leaders.


In addition, Mr. Casey was said by agency officials to have believed that Mr. Hugel would be adopt at helping develop commercial covers for American intelligence agents operating overseas.

Mr. Hugel, accordingly to a biography distributed by the intelligence agency, specialized in Japanese economics at the University of Michigan, from which he was graduated in 1953. Earlier, he established a company, Brother International, to sell Japanese-made sewing machines in the United States.

Former intelligence agency have criticized Mr. Hugel's appointment, saying he was an amateur in a job held in the pass by seasoned professionals. Their animosity was so strong that a White House official suggested today that former intelligence officials might have encouraged disclosure of the information about Mr Hugel's stock dealings, which forced him to resign.

All of Mr. Hugel's predecessors had experience in intelligence work before they took charge of clandestine operations. Those who have held the position since Mr. Dulles are Frank G. Wiener, from 1952 to 1958; Richard M. Biseal Jr. 1958 to 1962; Mr. Helms, 1962 to 1965; Desmond FitzGerald, 1965 to 1967; Thomas Karameesines, 1967 to 1973; Mr. Colby, 1973; William E. Nelson, 1973 to 1976; William Wells 1976-77, and John McMann, 1977 to 1980.



From the New York Times, May 22, 1981


The Company Mr. Casey Keeps

A certain skepticism is in order when the intelligence brotherhood complains that amateurs are taking over the Central Intelligence Agency. The Bay of Pigs wasn't exactly an amateur production, save in its humiliating outcome. Nor were the abortive attempts to assassinate Fidel Castro in the 1960's. But in the matter of Max Hugel, a New Hampshire businessman now turned spymaster, the consternation among old C.I.A. hands is surely understandable.

Mr. Hugel's most visible qualification is has long-time friendship with the C.I.A.'s Director, William Casey. According to his official biography, Mr. Hugel served as a junior Army intelligence officer during World War II. He has had three months' experience as a middle-echelon administrator at the agency's Langley headquarters, a.k.a. The Company. With only this background, he has now been promoted to head the agency's directorate of operations, which controls covert actions and clandestine intelligence overseas.

Plainly, Mr. Casey wants a loyal associate in this peculiarly sensitive post, which has been described as the most difficult and dangerous in the Government after that of the President. And Mr. Hugel earned that confidence when he resigned as an electronics company executive to help win the crucial New Hampshire primary victory just as Mr. Casey assumed command of the Reagan campaign. Mr. Hugel's political skills impressed old hands in that state, though they otherwise know little about him.

Still, winning votes in New Hampshire is one thing. Knowing the national security byways of Washington is quite another. And presiding over spy networks requires even more sophisticated knowledge and experience. Mr. Hugel's appointment is not subject to Senate confirmation, unlike the positions of C.I.A. Director and Deputy Director. So as a matter of law, Mr. Casey has every right to appoint a chum as spymaster. As a matter of policy, the appointment is questionable.

The C.I.A. is unlike any other agency in the degree of trust it demands from Congress and the public. That trust was grievously abused in a period not long ended. Who can be surprised if there are fears of a replay in an Administration that talks loosely about `unleashing' the C.I.A.? These fears are fanned when an outsider with tenuous credentials is given command of The Company's most free-wheeling division.

For security reasons, the Senate Intelligence Subcommittee has been reluctant to delve too deeply into the agency's secret operations. But the command structure is a different matter. Mr. Casey--even the President--have an obligation to explain what prompted the Hugel appointment, and to spell out the constraints on covert operations. That much light won't compromise the agency and would allay justifiable fears. In a double sense, The Company that Mr. Casey keeps is the public's business.



From the Washington Post, July 15, 1991


The Hugel File

The Max Hugel file, it turned out, was a little thicker than the CIA realized when it signed up the erstwhile New Hampshire businessman and Reagan campaign aide as deputy director of operations in May. The check that the agency ran on Mr. Hugel failed to pick up the tangled skein of certain of his business affairs that this newspaper brought to light yesterday morning. In the story, two former associates, tapes in hand, accused the nation's chief spymaster of engaging in improper or illegal `insider' stock market practices. Mr. Hugel denied all charges and, within hours, resigned.

The episode is a pie in the face of the CIA and its director, William J. Casey, who had rocked the agency's old-boy network, and raised eyebrows elsewhere, by choosing as his aide for covert operations and clandestine intelligence-gathering someone with no previous experience in those fields. The CIA is not the first organization to hire a bit hastily. Still, it has better reason and resources than most to proceed carefully. It is not hard to imagine scenarios--several novelists are probably at it already--with far graver endings than the resignation of an official whose difficulties lay entirely in his business past. That these difficulties were of a sort unquestionably familiar to Mr. Casey, a former chairman of the Securities and Exchange Commission, sharpens the question of how Mr. Hugel passed through the CIA screen.

In some quarters, Mr. Hugel's departure is being taken, and even celebrated, as vindication of the folly of bringing in an outsider to run the country's agents and spies. But, the tinge of social snobbism aside, this is a narrow view. His trouble came not in intelligence, in which he was an outsider, but in business, in which he was an insider. It has to be put down as a moot question whether the street-smart, free-wheeling Mr. Hugel would have done better or worse as a spymaster than those intelligence insiders whose shortcomings had made it seem sensible enough to install an outsider in the first place.