Barbara Honegger worked as a researcher at the Hoover Institution before joining the Ronald Reagan administration as a researcher and policy analyst in 1980. Honegger headed Reagan's gender discrimination agency review before resigning in August, 1983.
While working for Reagan she discovered information that convinced her that George H. W. Bush and William Casey had conspired to make sure that Iran did not release the U.S. hostages until Jimmy Carter had been defeated in the 1980 presidential election.
In 1987 Honegger began leaking information to journalists about the Reagan administration. However, it was not until Reagan left office that Honegger published October Surprise (1989). In her book, Honegger claimed that in 1980 William Casey and other representatives of the Reagan presidential campaign made a deal at two sets of meetings in July and August at the Ritz Hotel in Madrid with Iranians to delay the release of Americans held hostage in Iran until after the November 1980 presidential elections. Reagan’s aides promised that they would get a better deal if they waited until Carter was defeated.
Probably the most interesting and most important version of events is that of Robert McFarlane, who was then an aide to Senator John Tower on the Senate Armed Services Committee. In an interview on August 25, 1988, a journalist from a major news weekly informed the author that his magazine had been told by sources that the Iranian emissary who met with McFarlane, Allen, and Silberman in early October 1980 in Washington, D.C., had first approached Senator John Tower himself. If this is true, it would make sense of why Houshang Lavi says he flew from New York to Washington after first talking with James Baker, the top aide to then vice-presidential candidate George Bush. Senator Tower had been a personal friend and avid political supporter of George Bush for over twenty years. Tower had endorsed Bush in his congressional race in 1962, worked actively on behalf of his Senate bid in 1964, and publicly backed Bush in his contest for the 1980 Republican presidential nomination against Ronald Reagan when it was politically unpopular in their home state of Texas to do so.62 According to the San Francisco Chronicle: "At critical junctures," Tower's friends and associates said, "Tower was there to help Bush. "63 If Lavi, or any other "Khomeini emissary," did first contact Senator Tower, it makes sense that Tower would have asked his aide Robert McFarlane to put the emissary in contact with James Baker, the aide to Tower's close friend George Bush, to set up a meeting with officials of the Reagan-Bush campaign. This, of course, is precisely what Houshang Lavi claims happened.
Donald Gregg has an interesting alibi for October 18, 19, and 20, 1980. He told the Boston Globe and the Portland Oregonian that his private calendar for those days shows that he and his wife spent October 17-19 at a beach house in Bethany Beach, Delaware, which he said had been lent to them by a neighbor. Mr. Gregg, however, did not produce copies of his alleged calendar, and the neighbor, Mr. John Davis, told the Oregonian that, though he did sometimes lend the beach house to the Greggs, he had no records or memory based upon which he could confirm the dates."' The owner of the beach house also told Der Spiegel that he had no recollection of having given the keys to the Greggs, or of their having used the cottage.
Gregg told the Oregonian that he had "played tennis and run on the beach" during their stay at the vacation house. A check of the weather that day, however, revealed that it was cold, damp, and rainy. When asked whether anyone had seen him during the stay, rather than mentioning his wife, Mr. Gregg responded, "I have no recollection of that. -13' This is a surprising answer in light of the fact that Gregg's own daughter, Lucy Gregg Buckley, told the paper that she recalled spending time that weekend with her parents. Whether that was just on the 17th, the day before Heinrich Rupp's plane left Washington, D.C., for Paris, or also on the 18th and 19th, was not reported. If Mr. Gregg was in fact at the beach house, and if his daughter saw him that weekend, as she recalls, it is curious that he told the Boston Globe there were "no witnesses" to he and his wife having been at the cottage. "
On October 20, 1980, when Richard Brenneke claims Mr. Gregg was at a meeting with him taking notes in Paris, France, Mr. Gregg claims to have been at work in Washington, D.C., presumably at the White House National Security Council where he was employed at the time. His only evidence for this, however, is that he claimed to have had three memoranda assigned to him for action that day and to have, he says, "originated" a memorandum on the 20th. 139 Mr. Gregg has not produced any such alleged memorandum, however, nor has he said what "action" he was to have taken on October 20, 1980, whether he took it, or where.
Wheaton claims that the "French Connection" to the U.S. "Irangate" includes then Senator Dan Quayle, President George Bush's choice for vice-president in 1988. According to Wheaton, a major source of Quayle's political power in Indiana, his home state, is a longtime associate of former CIA director William Casey, Beurt SerVaas. SerVaas, Wheaton says, was on the Executive Board of the Veterans of the O.S.S. (the predecessor organization to the CIA), which "runs the CIA from behind the scenes. " SerVaas's daughter, Joan, according to Wheaton, is married to an "off-the-books" French intelligence asset and Indiana resident, Bernard Marie. In 1982, Wheaton claims to have introduced Marie to Defense Intelligence Agency (DIA) officials who then played a key role in the Reagan-Bush Administration's secret deliveries of U.S. arms to Iran in the 1980's.54 DIA was one of the military intelligence agencies that was uninterested in prosecuting Colonel Ralph Broman for his arms dealings with the Khomeini regime out of Paris in the early to mid 1980's.
Oliver North's courier in the Iran/Contra operation, Robert Owen, was introduced to another Indianan, John Hull, and to Contra commander Luis Rivas in Senator Dan Quayle's office on July 21, 1983, when Owen was Quayle's legislative aide. Senator Quayle reportedly stayed for the beginning of the meeting.55 That summer, Quayle authorized Owen to travel to Hull's ranch in Costa Rica at Hull's expense. The ranch was being used by the CIA as a military supply site for the Nicaraguan Contra rebels, a relationship that continued throughout the period during which "profits" from the administration's secret arms sales to Iran were illegally diverted to the Contras. In November 1983, Robert Owen left the staff of Senator Dan Quayle and went to work for Oliver North's "Project Democracy," which oversaw secret U.S. arms shipments to both the Contras and to Iran.
Considering Senator Quayle's reported link to French intelligence through Beurt SerVaas and Bernard Marie, and his link to Oliver North's "Project Democracy" through their mutual aide Robert Owen, it is more than likely that Mr. Quayle had also been made aware of secret U.S. arms shipments to Iran in the first years of the Reagan-Bush Administration. If so, it is probable that he was also privy to the genesis of those early arms deliveries to the Khomeini regime in alleged pre-1980-election meetings among future CIA director William Casey, Iranian representatives, and French intelligence agents. According to Gene Wheaton, "SerVaas brought Quayle into the Casey network early in the game."
William Casey, CIA Director, who reportedly attended meetings in Paris, France, on October 19 and 20, 1980, with Iranian officials and agents of French intelligence to arrange an arms-for-hostages-delay deal with Iran. The morning of his first scheduled under-oath testimony before the Senate Intelligence Committee on the secret Iran initiative he was struck by seizures in his CIA headquarters office in Langley, Virginia, and underwent speech-incapacitating left brain surgery shortly thereafter. Had he lived to testify, according to life-long friend and counsel Milton Gould, Casey would have told the "entire truth." He died on May 6, 1987.
"Y" claimed that the $40 million from the $60 million Mexican CREEP fund from the Shah of Iran had been wired, in two parts, to separate accounts in Bank Leu in Zurich, Switzerland-one account controlled by Iran and the other by the Czechs-by Merrill Lynch, whose chairman and chief executive officer was Donald Regan, President Reagan's future White House chief of staff. Regan had gotten to know and like William Casey when Casey was head of the Securities and Exchange Commission (SEC), also during the Nixon Administration.98 The Czechoslovakian connection is confirmed by Richard Brenneke's records, which show that he had had numerous dealings with Czech arms manufacturers in the early 1980's, and by reports that Brenneke's friend Robert Benes, whom he said also attended the Paris meetings, was a double agent for France and the Czechs.
Probably not coincidentally, a subsidiary of Merrill Lynch, Merrill Lynch Futures, reportedly loaned between $400,000 and $500,000 to Dr. Cyrus Hashemi, one of the Iranian arms dealers who had reportedly attended the Paris meetings, shortly after Reagan and Bush gained office, to finance both the transport of arms to Iran and activities against anti Khomeini dissidents abroad. This amount is comparable to that reportedly loaned to now-imprisoned ex-CIA covert operative Edwin Wilson in 1979: $500,000. With the loan, Wilson and George Bush's longtime CIA associate Theodore Shackley became 49 percent partners in EATSCO, the Egyptian American Transport and Services Corporation, which reportedly received an exclusive contract from the Pentagon to ship U.S. arms to Cairo following the signing of the Camp David Accords between Egypt and Israel in 1979. According to Wilson, silent partners in EATSCO were indicted Iran/Contra co-conspirator, Richard Secord, "off the reservation" CIA operative Thomas Clines, and Erich von Marbod who was then Deputy Director of the Pentagon's Defense Security Assistance Agency which, in an obvious conflict of interest, had recommended approval of the EATSCO contract. The reported president of EATSCO was Hussein K. Salem, an Egyptian. In 1983, EATSCO's partners, including Secord, were indicted for overcharging the U.S. government $8 million-intriguingly the same amount that Secord and his Iranian-American partner Albert Hakim are charged with having illegally skimmed from the Reagan-Bush Administration's secret operation to ship U.S. arms to Iran. In 1982, State Department advisor Michael Ledeen intervened in the case, suggesting to Assistant U.S. Attorney E. Lawrence Barcella that any alleged "billing abuses" in the EATSCO matter may, as in the Iran/Contra scandal, have been used to fund covert operations. The implication of the above reports is that Cyrus Hashemi's $500,000 loan may have gone to start what we will call "IRANSCO" in 1981, just as Edwin Wilson's $500,000 loan went to start EATSCO in 1979, with the same $8 million figure ending up in contention in U.S. courts and involving almost the same cast of characters. When Richard Secord retired from the Pentagon in 1983 in the wake of the mini-scandal, which had developed over his involvement with EATSCO, he became partners with Iranian middleman Albert Hakim, to whom he had been introduced by none other than Wilson, in another military equipment trading company, Stanford Technology Trading Group. The cycle then repeated itself, with Iran instead of Egypt being the recipient of arms. According to Informant "Y," EATSCO was in fact a "shake down cruise" for the far larger IRANSCO operation that followed it. "They used EATSCO to get the `bugs' out of the system," he said. "The Egyptian operation was used as a model for future operations. The $500,000 in both instances was needed to get things going-as deposits for the shippers."
When asked how his account regarding the transfer of the $40 million to Bank Leu in Zurich, Switzerland, squared with Richard Brenneke's claim that it had been wired to Banque Lambert in Brussels, Belgium, "Y" said that the reports were "not necessarily inconsistent" because the money from the Mexican account had long since been moved to an account or accounts in Europe, perhaps at Banque Lambert. The funds, he contended, may have been wired from Banque Lambert to the two accounts at Bank Leu. Alternatively, he said, after eight years his memory of the French intelligence report may have been incorrect, and the funds may have originated in Bank Leu in Switzerland and been transferred to Banque Lambert, as Brenneke claimed. This latter account squares better with one given by the former U.S. chief of the Shah's secret police, Mansur Rafizadeh.