Iran Arms Sales

DOD's Transfer of Arms to the Central Intelligence Agency Gao ID: NSIAD-87-114 March 13, 1987

Pursuant to a congressional request, GAO reviewed the Department of Defense's (DOD) transfer of missiles and spare parts to the Central Intelligence Agency (CIA) for shipment to Iran.

GAO found that: (1) DOD properly treated the transfer as an interagency transfer under the Economy Act, rather than as a foreign military sale under the Arms Export Control Act; (2) the Arms Export Control Act's pricing and congressional reporting requirements were not applicable to the transfer; (3) DOD bypassed its normal review and approval channels because of the covert nature of the transfer; (4) DOD undercharged CIA $2.1 million for the missiles; and (5) while DOD covert arms transfers are ordinarily subject to congressional notification requirements, in this case a presidential intelligence finding that initiated the transfer ensured that the responsibility for meeting such requirements lay with the President.


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