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Yet in his congressional testimony and in an interview with TIME several days later, Casey professed to know little about the clandestine arms shipments to Iran, or who had placed money in the CIA account to pay for them. He claimed to be unaware that profits from arms sales had been diverted to the contra forces until shortly before Attorney General Edwin Meese disclosed this to a startled nation on Nov. 25. "I don't know anything about diversion of funds," Casey told TIME. "The NSC was operating this thing; we were in a support mode."
He knew even less, Casey claimed under oath, about who had funded the flights that airdropped arms to the contras inside Nicaragua. The CIA had gathered intelligence on the contras, he says in the interview, "but we didn't know and they weren't telling us about their funding and about their procurement."
Is this mixture of involvement and ignorance credible on the part of the nation's top spook? One former high CIA official aware of the Company's procedures doubts it. Casey, this source speculates, must have been involved in the secret arms deals with Iran "from the beginning." The role of Marine Lieut. Colonel Oliver North as the National Security Council's point man, says the former official, gave the CIA "plausible deniability." According to this theory, the CIA played its role without leaving a paper trail. Casey, he says, could have told his key people, "If you get a call from Ollie North, do what he asks."
Going beyond theory, this CIA veteran claims that he had been asked by several middle-level CIA officials whether "opening a bank account on oral authority makes them vulnerable to prosecution." He has advised them to "get whatever protection they can" from the congressional committees. Members of the intelligence oversight committees confirm that they have received such inquiries from a number of deeply troubled CIA agents.
Minnesota Republican Senator David Durenberger, chairman of the Senate Select Committee on Intelligence -- which has also grilled Casey in closed session -- is less certain that the Director is concealing his own knowledge of the affair. "A whole lot of guys in the CIA knew a little something about this," he says. "They all had pieces of it. I suspect Casey had most of it . . . but nobody (at the CIA) understood the big parameters of it," a reference to the diversion of the arms profits.
On one crucial matter of timing, Casey's congressional testimony seemed candid -- up to a point. The White House credibility on the scandal has come to rest on Meese's Nov. 25 contention that no one in the Government was aware that funds had been diverted to the contras except North and his boss, then National Security Adviser John Poindexter.
The hearing room grew deathly still as the Foreign Affairs Committee listened to Casey drop his one bombshell. He told the Congressmen that on Oct. 7, seven weeks before the Meese revelation, he had a brief meeting with New York Businessman Roy Furmark, a longtime acquaintance and a man for whom Casey had provided legal advice in the 1970s. Furmark had informed Casey that two Canadian businessmen had backed a heavy investment in the weapons deals, had not been repaid, and were threatening to file lawsuits that would expose the whole affair.