Bill Casey' Iranian
Iranian banker Cyrus Hashemi was a mystery man of the 1980s, a
nexus point for scandal, from accessing vaults of the corrupt
BCCI to opening doors to the Iran-Contra Affair. But for years,
the FBI withheld key wiretaps of Hashemi's secret conversations.
Now, from a dusty box in a Capitol Hill storage room, a
classified summary of those incriminating calls has been
recovered. It fills in crucial missing pieces of the history
of the Reagan-Bush era: another chapter of the October Surprise
By Robert Parry
- October Surprise X-Files (Part 3): Bill Casey's Iranian
WASHINGTON -- On Sept. 23, 1980, in the midst of the
Reagan-Carter presidential race, two men from Houston placed
phone calls to an Iranian banker at his swank office in a
mid-town Manhattan skyscraper. The two men had a cryptic
message. They informed the banker, Cyrus Hashemi, that "a Greek
ship captain" would be delivering a $3 million deposit from
Beirut to Hashemi's offshore bank headquartered in the
Hashemi was told the "Greek ship captain" would use the name
"Fibolous." One of the Texans, a former judge named Harrel
Tillman, considered himself a 30-year friend of George Bush, the
Republican candidate for Vice President. Hashemi, in 1980, was
acting as a principal intermediary for President Carter's
frantic efforts to free 52 Americans held hostage in Iran.
On Nov. 20, after President Carter failed to spring the hostages
and lost to Ronald Reagan, Tillman was back on the phone with
Hashemi, this time about the "purchase of [a] refinery,"
according to a "secret" FBI wiretap summary. Tillman said he
had been in touch with Vice President-elect Bush and had
consulted with "the 'Bush' people" about the troubles that Hashemi
and his business associate, John Shaheem, were having
with a bankrupt oil refinery in Newfoundland.
"Bush people would be cooperative with this matter and make it a
showcase," Tillman said, according to the summary. "But the
'Bush' people would not act on it until after the Inauguration"
in January 1981.
Interviewed this past week about those 1980 phone calls, Tillman
said he recalled nothing about either the $3 million deposit or
the promises from the "Bush people." "I don't remember having
that conversation," Tillman told me. He acknowledged, though,
being questioned about the calls by congressional investigators
in 1992, but added that he could not recall the substance of
that interview either. "I'm not trying to be evasive," he
But the ex-judge did add another twist to the mysterious phone
calls. Tillman said that besides supporting the Reagan-Bush
ticket in 1980, he was working as a consultant to Iran's radical
Islamic government. Tillman also felt President Carter had
bungled the hostage crisis.
Still, whatever the reason for the $3 million deposit -- whether
it was a payoff or an unrelated business deal -- it added to
Hashemi's already-deep dependence on the Republicans. Hashemi
worked closely with former Nixon administration official Stanley
Pottinger and was a business associate of John Shaheen, a
Republican businessman who counted among his best friends
William J. Casey, then in charge of the Reagan-Bush campaign.
A Madrid Meeting?
Hashemi's ties to Casey and Shaheen would be central to
allegations that the Reagan-Bush campaign sabotaged President
Carter's hostage talks. Hashemi's older brother, Jamshid,
claimed that Cyrus and Casey began collaborating secretly on the
Iranian hostage issue in the spring and summer of 1980.
According to Jamshid Hashemi's sworn testimony, Cyrus arranged a
clandestine meeting in Madrid between Casey and a radical
Iranian mullah, Mehdi Karrubi, in late July 1980. At the meeting,
Casey allegedly opened a back-channel to Iran that
disrupted President Carter's hostage negotiations and ensured
Ronald Reagan's resounding victory that November.
As many as two dozen other Iranian, European and Middle Eastern
officials made similar assertions of GOP interference. But in
January 1993, after a year-long investigation, a special House
task force concluded that "no credible evidence" existed to
support allegations of a Republican dirty trick. One of the
task force's principal arguments for the debunking was that a
careful review of secret FBI wiretaps on Cyrus Hashemi's phones
from September 1980 to February 1981 found nothing to support
the so-called October Surprise charges.
So when I gained access to boxes of the task force's raw records
in an obscure Capitol Hill storage room (see The Consortium,
Dec. 21), I was startled to discover a "secret" FBI wiretap
summary that revealed a much more complex story than the House
task force's sanitized version of events.
For instance, while the task force was aware of the $3 million
"Greek ship captain" deposit and the potential conflict of
interest it represented for Cyrus Hashemi, no mention was made
of it in the House report. Nor did the task force explain
financial connections that tied Shaheen and Hashemi to wealthy
figures from the Philippines, the Middle East, the corrupt Bank
of Credit and Commerce International, and the ousted royal
family of Iran.
All those links gave Hashemi powerful motives to betray
President Carter -- and, in each one, William Casey was in the
The wiretap summary showed almost daily contacts between Cyrus
Hashemi, a worldly financier in his 40s whose phone calls
included chats with high-priced prostitutes, and John Shaheen,
the fast-talking former officer in World War II's Office of
Strategic Services. Shaheen and Casey, who met in the OSS, also
had worked together on the failed Newfoundland oil refinery that
Hashemi and Tillman discussed in the wiretapped conversation.
Indeed, on Sept. 22, the day before the first calls from
Houston, Hashemi was on the phone discussing how to line up a
$40 million loan to help Shaheen regain control of the refinery.That same week, Hashemi and Shaheen hashed over schemes for
opening a bank together, possibly in Asia with some Philippine
On Sept. 25, Hashemi and Shaheen discussed a "Hong Kong deal,"
according to the wiretaps. On Oct. 14, the two men were
arranging a meeting with Philippine bankers and businessmen.
Hashemi expressed concern because he had already deposited "a
large sum of money in a bank in the Philippines."
In mid-October 1980, even as Hashemi supposedly was helping
President Carter's last-ditch effort to resolve the hostage
crisis, the Iranian banker began work with other Republicans
lining up arms shipments to Iran, including parts for helicopter
gunships and night-vision goggles for pilots.
The FBI wiretap summary also contained references to Hashemi
lying about the hostage issue. On Oct. 22, 1980, the FBI bugs
caught Hashemi's wife, Houma, scolding her husband about his
denials that he had discussed the hostages with Iranian Prime
Minister Mohammed Rafsanjani. "It is not possible to be a
double agent and have two faces," Houma warned Cyrus.
The next day, Oct. 23, Shaheen again was in Hashemi's office at
9 West 57th St., using one of the bugged phones to brief a
European associate, Dick Gaedecke, about the latest developments
in the hostage negotiations. Hashemi was keeping Shaheen,
Casey's pal, fully informed about President Carter's hostage
A Reagan Link?
On Oct. 24, the FBI recorded another cryptic note suggesting
Hashemi's close ties to another prominent Republican. Using
Cyrus Hashemi's initials, it read: "CH-banking business about
Reagan overseas corp.," according to the wiretap summary.
The possibility of a Reagan-Hashemi link was not entirely new.
It arose initially in 1992 when Reuters news agency quoted FBI
sources in New York as saying that agents heasrd Ronald Reagan on
one Hashemi tape. But the congressional investigators said
Reagan was not recorded speaking on the 548 tapes made available
to Congress, except for some television background noise.
But the investigators were unable to explain an eight-day gap on
one tape. Eleven others were blank, a condition possibly caused
by intentional erasure, according to tape experts. Still, the
House task force found nothing suspicious about this pattern.
In clearing the Republicans, the House report also left out
testimony from Iran's former Defense Minister, Ahmed Madani, who
stated that he, too, had chastised Hashemi for collaborating
secretly with the Republicans behind President Carter's back.
Madani testified that Hashemi offered to bring Casey to a
hostage discussion during the campaign.
"We are not here to play politics," Madani said he responded.
The discussion convinced Madani that "Casey wanted to fish in
troubled waters" and that Hashemi was "double-dealing" President
In the transition period after Ronald Reagan's victory, the FBI
picked up more conversations about Hashemi's GOP ties. On Nov.
20, the same day as Tillman's call about the "Bush people,"
Hashemi boasted to fellow Iranian Mahmood Moini about ties to
Casey, who was then running President-elect Reagan's transition
office. "I have been, well, close friends ... with Casey for
several years," Hashemi told Moini.
Although the Carter administration had finally frozen Hashemi
out of the hostage talks because of the arms dealing, the shrewd
Iranian banker kept his hands in. On Jan. 15, 1981, Hashemi met
with Iranian Revolutionary Guard officials in London and opened
an account for them with 1.87 million pounds (roughly equal to
$3 million), according to the FBI wiretaps. The money
apparently was to finance arms sales.
On Jan. 19, 1981, the last day of the Carter Presidency, Hashemi
was back on one of the bugged phones, describing to a cohort
"the banking arrangements being made to free the American
hostages in Iran." Hashemi was also moving ahead with military
shipments to Iran. "How should we proceed with our friend over
there?" the associate asked Hashemi. "I'm just a little bit
nervous that everyone is trying to move in on the action here."
The hostages were released the next day, immediately after
Ronald Reagan's Inauguration.
BCCI Flies the Concorde
Over the next weeks, unusual deposits continued to flow into
Hashemi's offshore bank, the First Gulf Bank and Trust Company.
In early February 1981, the FBI recorded a call alerting Hashemi
that "money from BCCI [is] to come in tomorrow from London on
Within days of the BCCI-Concorde call, the new Justice
Department ordered the wiretaps pulled from Hashemi's office.
Though the FBI and field prosecutors wanted to use the wiretap
information immediately to mount an arms trafficking case
against Hashemi, the proposed indictment languished for more
than three years. Even then, in May 1984, when the evidence
finally went to a grand jury, the Justice Department insisted on
tipping off Hashemi, allowing him to cancel a flight from London
to New York and avoid arrest.
Less than a year later, in early spring 1985, Israeli arms
dealers, Albert Schwimmer and Ya'acov Nimrodi, arrived at a
luxury London hotel to meet with Cyrus Hashemi, Saudi financier
Adnan Khashoggi and an Iranian intelligence man named Manucher
Ghorbanifar. Hashemi was proposing more weapons sales for Iran.He was working again with John Shaheen and Bill Casey, who was
President Reagan's director of the CIA.
A year later, still in London, Hashemi fell suddenly ill with
what was diagnosed as acute leukemia. He died on July 21, 1986.
But what Hashemi had started in that London hotel room would
become known a few months after Hashemi's death as the
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