Iran-Contra: The Reagan Scandal · 29 Sep 2026 · 13 min

Two Illegal Schemes, One Basement: How Iran-Contra Worked

The Reagan White House secretly sold arms to Iran and funneled the profits to the Nicaraguan Contras — both illegal, both running out of a basement NSC office. This is the full story of how Iran-Contra actually worked, and why it remains the biggest scandal since Watergate.

Iran-Contra: The Reagan Scandal
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Two Illegal Schemes, One Basement: How Iran-Contra Worked

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What's covered

The Setup Nobody Saw Coming

Here's something worth sitting with. At the height of the Cold War, the United States government was secretly selling weapons to the Ayatollah Khomeini's Iran, a regime it publicly called a sponsor of terrorism, while simultaneously funneling the profits to a rebel army that Congress had explicitly made it illegal to fund.

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Two Laws, Two Violations

To understand Iran-Contra you need to understand the two separate schemes that collided inside it. The first scheme involved Iran.

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The Basement Operation

North ran this out of the NSC's offices with minimal documentation and maximum compartmentalization. His boss, National Security Advisor John Poindexter, knew what was happening.

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Fawn Hall and the Shredder

When the operation began to unravel in late nineteen eighty-six, the response inside North's office was immediate. North and his secretary, Fawn Hall, began destroying documents.

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The Hearings, the Uniform, and the Icon

Congress launched formal hearings in nineteen eighty-seven. The joint House and Senate committee hearings ran through the summer and became one of the defining political spectacles of the decade.

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Walsh, the Tower Commission, and the Pardons

The Tower Commission delivered its report in February nineteen eighty-seven. Former Senator John Tower led the panel, with Edmund Muskie and Brent Scowcroft.

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What It Established

Iran-Contra established several things that remain relevant. The NSC is not a covert operations agency.

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