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00:00It was one of America's most notorious presidential scandals
00:04that must cost Ronald Reagan his presidency.
00:08The Iran-Contra Affair.
00:15In the early 1980s, the U.S. was still in a cold war with Russia,
00:19and anti-communist sentiment was strong.
00:22During his presidential campaign, Reagan promised to assist anti-communist insurgencies around the world.
00:27For a brief time under Reagan, the CIA trained and assisted groups fighting communist leaders abroad.
00:34Reagan was particularly interested in a group called the Contras and their battle in Nicaragua.
00:40The Contras were a group battling the Cuban-backed Sandinistas,
00:43a communist group who had seized power in 1979.
00:46Reagan called the Contras the moral equivalent of our founding fathers.
00:52But much of the Contras' funding came from the cocaine trade.
00:56Because of this, Congress passed the Bolin Amendment,
01:00specifically aimed at keeping American money from funding the group.
01:03That happened in 1982, shortly after Reagan took office.
01:07The amendment restricted the CIA and Department of Defense from using funds
01:10to provide military assistance to groups that were trying to overthrow Nicaragua's government,
01:16groups like the Contras.
01:18This didn't stop Reagan.
01:32The president told his national security advisor, Robert McFarland,
01:35to help the Contras anyway, regardless of the cost.
01:38McFarland found opportunity in Iran.
01:41In 1985, an Iranian-backed terrorist group held seven American hostages in Lebanon.
01:52Reagan insisted his advisors find a way to bring the hostages home, saying,
01:56I want you to do whatever you have to do to help these people keep body and soul together.
02:01So, with permission from Reagan, McFarland made a deal.
02:06The U.S. would give Iran weapons, and Iran would broker the release of the hostages.
02:11This happened even though Reagan publicly insisted he would not negotiate with terrorists,
02:15and despite the fact that there was a trade embargo with Iran.
02:19But that was just the tip of the iceberg.
02:22The deal with Iran didn't just secretly secure the release of the hostages in exchange for weapons.
02:27There was money involved.
02:28While $30 million had been allocated for the weapons,
02:32the CIA funneled a portion of that money to the Contras in Nicaragua,
02:37the group Reagan supported in their guerrilla fight against the Sandinista government.
02:42In 1986, the Lebanese newspaper Al-Shara reported the arms deal,
02:47and everything began to unravel.
02:49That prompted an investigation by the U.S. Attorney General,
02:52who discovered that only $12 million of the $30 million
02:56actually went toward weapons for Iran.
02:59The rest of the money was sent to the Contras in Nicaragua.
03:01The revelations were explosive.
03:19Reagan denied the allegations that he had negotiated with terrorists.
03:23But Lieutenant Colonel Oliver North came forward
03:25and acknowledged that he diverted funds to the Contras.
03:29North also said Reagan knew about it.
03:35North's testimony would inspire the press and Congress
03:38to launch investigations against Reagan for the rest of his presidency.
03:42Texas Senator John Tower led the investigation into the scandal.
03:46The Tower Commission determined it was Reagan's lack of oversight
03:49that allowed Iran-Contra to happen,
03:52but did not implicate Reagan directly.
03:54It wasn't until another congressional investigation in 1987
03:58that Reagan finally testified.
04:01On May 5, 1987, joint hearings were televised
04:05investigating the covert arms deal with Iran
04:08and the assistance to Nicaragua.
04:11The hearings would go on for 41 days.
04:14Reagan was never charged but McFarland,
04:17Oliver North, four CIA officers,
04:19five government contractors
04:21and Reagan's National Security Advisor John Poindexter
04:25were all found guilty.
04:27Yet, speculation about Reagan's involvement lingered on.
04:31Press investigations would go on for years to follow.
04:34While Reagan's image suffered a bit,
04:36he still left office with one of the highest approval ratings
04:39of any president in U.S. history.
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