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Memo Describes Meese Meeting With Israeli Prime Minister on Pipeline

March 13, 1988

WASHINGTON (AP) _ A memo by a longtime friend of Attorney General Edwin Meese III describes the two men joining in a 10-minute ″briefing″ of Israeli Prime Minister Shimon Peres on a proposed $1 billion Iraqi oil pipeline.

The memo by E. Robert Wallach, first disclosed in Sunday editions of The Washington Post, says Peres ″literally dragged me off into a corner″ and began discussing the pipeline ″intensely″ at an Israeli embassy reception in Washington on Oct. 16, 1985.

The document says that in the crush of activity at the reception, Peres then asked Wallach to wait until after the event to discuss the pipeline further.

″Fortunately, as the time approached, my friend (Wallach’s usual phrase for Meese) arrived and there was a three-way discussion which took approximately 10 minutes,″ said Wallach’s memo.

″He (Peres) is very quick and we went right to the point and he was agreeable in all respects. It wasn’t the kind of briefing I would have preferred, but it seemed to be effective,″ the memo said.

Meese, interviewed Sunday on ABC-TV’s ″This Week With David Brinkley,″ denied the story, while Foreign Ministry officials in Israel refused to comment on the latest report.

The attorney general, asked if the report was correct, responded: ″No it’s not. It’s the usual thing you expect these days from The Washington Post, taking a small fact that is well known and trying to blow it up into a new news story.″

″Many times, at that particular reception I had brief conversations with Prime Minister Peres,″ Meese said. ″There’s nothing new to it.″

Meese also reiterated that he will not resign his post despite the growing controversy.

″Obviously I shouldn’t step aside because if honest public officials can be hounded out of office by partisan political attacks, by media barrages, then no one as a public official is safe,″ he said.

The attorney general said that ″at no time has this (investigation) detracted from my ability to do my job.″

Asked if he should step aside for President Reagan’s sake, Meese said, ″I think it would hurt him. And I think it would hurt the cause of good government more if I didn’t stand up and fight these false allegations because to leave would acknowledge that maybe there’s some truth to them.″

On Sunday, James Rocap, one of Meese’s lawyers, said that ″Wallach’s account totally exaggerates″ the discussion ″in order to impress his (Wallach’s) client.″

Wallach was legal counsel to Swiss oilman Bruce Rappaport, a partner in the proposed project. Two months before the embassy reception, Rappaport had paid Wallach $150,000, which Wallach directed be sent to an account owned by W. Franklyn Chinn, an investment manager at the time for both Wallach and Meese.

Wallach’s money was in effect pooled in several stock trades with Meese’s funds, sources familiar with a criminal investigation of Meese, speaking on condition of anonymity, said Friday.

Meese, asked about reports that he had profited from stock trades involving $150,000, said, ″I knew nothing about this money being paid.″

Chinn’s company had a separate financial arrangement with Meese. The attorney general said that in any event his financial arrangements with Chinn were set up as a limited blind partnership so that ″I had no way of knowing what was being done or how it was being managed.″

Meese described Wallach as ″my friend″ and said he ″never asked me to do anything that was wrong. ... In this case, a lot of people are taking a simple situation where I turned something over to the National Security Council staff and then for political reasons or media attack reasons they’re trying to make a big deal out of it.″

In a statement issued Feb. 1, Meese said that his total involvement with Peres on the pipeline consisted of ″only two contacts ... each was brief and limited and neither was initiated by me.″

A second memo by Wallach, also described in Sunday editions of the Post, recounts a meeting in New York - a few days after the embassy reception in Washington - involving Peres, Wallach, then-National Security Council aide David Wigg and the Israeli ambassador to the United States.

Wallach said the meeting lasted about 15 minutes and that the four discussed two proposed letters for Peres to sign, the first committing Israel not to disrupt the pipeline and the second dealing with the concepts of using U.S. foreign aid to Israel as insurance for the project.

Peres has said he recalls having met Wallach only twice, on social occasions with others present.

Peres eventually signed a later version of the first letter. Peres said he could not act on a second letter without additional consultation in Israel, Wallach’s memo said.

The pipeline project collapsed shortly thereafter for lack of an insurance package. The Justice Department saw legal impediments to using Israeli aid money.

Finally, National security adviser John Poindexter, on the advise of former NSC adviser William Clark, killed U.S. involvement in the project.

Meese’s involvement with the proposed pipeline is under criminal investigation by Independent Counsel James McKay, who launched a probe of Meese’s activities last May 11.

The two memos were obtained from Wallach’s files recently by McKay’s investigators, said sources familiar with the probe.

The sources outlined the memos contents following the account in the Post.

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