Contra Fund-Raiser Agrees to Talk About North Deals : Bargains a Plea on Tax Fraud
WASHINGTON — Conservative fund-raiser Carl R. (Spitz) Channell pleaded guilty today to the first criminal charges filed in the Iran- contra scandal and named Lt. Col. Oliver L. North as a co-conspirator in a scheme to defraud the government.
Channell agreed to cooperate with federal prosecutor Lawrence E. Walsh’s investigation of the Iran-contra affair.
Channell, 41, appearing before U.S. District Judge Stanley Harris, pleaded guilty to one count of conspiracy by illegally claiming tax-exempt status for his effort to raise funds to arm the Nicaraguan contras.
He appeared in court just hours after Walsh charged him with the felony--resulting in the first conviction in the scandal.
North, Miller Named
The conservative fund-raiser named as co-conspirators North, the aide fired Nov. 25 from the National Security Council for his role in the U.S. arms sales to Iran and diversion of profits to the Nicaraguan contras, and Richard Miller, a Channell associate with his own public relations firm, International Business Communications, which has been linked to the private aid network for the rebels.
Harris found Channell, the head of a vast fund-raising network for conservative causes, guilty of a single conspiracy charge but withheld sentencing at the request of Walsh’s attorneys until after Channell completes his cooperation in the investigation.
Channell, who assured Harris repeatedly that he understood the agreement and wished to plead guilty, was released on his own recognizance. He faces up to five years in prison and a $250,000 fine.
Three Others to Cooperate
David Zornow, an assistant to Walsh, told the judge that three other members of Channell’s organization, the National Endowment for the Preservation of Liberty, had signed written agreements with Walsh’s office to cooperate with the continuing investigation.
Walsh, in a felony information filed in U.S. District Court, said Channell conspired to defraud the Internal Revenue Service and the U.S. Treasury by falsely filing for tax-exempt status for his conservative fund-raising group. The charge itemized more than $2 million in contributions raised for “military and other types of non-humanitarian aid for the contras.”
Such aid is not deductible under federal regulations.
Praised by Administration
President Reagan and Vice President George Bush have praised Channell’s fund-raising activities. On several occasions, Reagan met with Channell’s top contributors at White House gatherings.
In a statement afterward, Walsh said, “Today’s guilty plea and Mr. Channell’s agreement to cooperate is a significant step forward in our continuing investigation of the Iran-contra matter.”
Outside the U.S. Courthouse, Walsh’s assistants were asked whether North would eventually be charged with the same offense that Channell pleaded guilty to.
“We’re not prepared to do that at this time,” said Michael Bromwich, another prosecutor in Walsh’s office.
Research Status Claimed
The criminal information filed earlier in the day against Channell by Walsh’s office pointed out that in his reports to the IRS, Channell described the endowment as an education and research foundation devoted to “study, analysis and education” on American socioeconomic and political systems.
A criminal information is a charge filed by a prosecutor without going before a grand jury.
In another development today, Senate and House investigators announced that Retired Maj. Gen. Richard V. Secord, a key figure in the Iran-contra affair, will be the first witness at congressional hearings into the scandal that begin Tuesday and will testify without immunity.
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