Created by the National Security Act of 1947, the NSC advises the president of the United States on security, intelligence, and foreign policy issues and consists of the vice president, the secretary of state, and the secretary of defense. The NSC is headed by the national security adviser, who is supported by a staff on temporary assignment from other departments.
Although the NSC has no operational capability, in 1985 Director of Central Intelligence William Casey opted to circumvent congressional oversight by using the NSC staff to undertake a complicated series of transactions that could not be completed legally by the Central Intelligence Agency. His objective was to free the CIA station chief in Beirut, William Buckley, who had been abducted by Tehran-controlled Hezbollah terrorists in March. The scheme, later known as the Iran-Contra affair, was intended to arrange through intermediaries for the sale of embargoed weapons to Tehran and to divert the windfall profits to the Nicaraguan Contra rebels who had been barred from CIA financial support since the passage of the Bolland Amendment in December 1982. Almost coincidentally, in January 1986, CIA pilot Eugene Hasenfus was captured in Nicaragua when his supply plane was shot down, apparent proof of violations of the Bolland Amendment. A subsequent investigation conducted by Senator John Tower revealed the extent to which Casey, who succumbed to a brain tumor in January 1987, had masterminded the operation, and consequently Col. Oliver North and two of the president’s national security advisers, Adm. John Poindexter and Robert McFarlane, were convicted of various offenses connected with the arms sales, diversion of funds, and misleading Congress and were fined.