With the indictment yesterday of four key figures, the Iran-contra affair enters a new phase - pretrail wrangling. A federal grand jury called by Iran-contra special prosecutor Lawrence Walsh issued charges of conspiracy to defraud the government against retired Rear Adm. John, who was director of President Reagan's National Security Council until he resigned under fire; Marine Lt. Col. Oliver North, who headed up a network to divert profits from Iranian armed sales to the contras; retired Air Force Maj. Gen. Richard Secord, who was the principal private sector operator in the sale of arms to Iran; and Albert Hakim, General Secord's business partner.
``We're looking at months and months and months before any trial is a realistic possibility,'' says one source familiar with the investigation. Besides pretrial maneuvering, the United States Supreme Court must rule on the validity of the special-prosecutor law before a trial can begin.
On April 26 the Supreme Court will hear oral arguments on the law, following a federal appeals court ruling that it is unconstitutional.
If the justices agree with the lower court, or if they render a 4-to-4 vote - Justice Anthony Kennedy has recused himself - then much of the evidence against Colonel North, retired Navy Rear Admiral Poindexter, and Mr. Hakim could be in jeopardy.
The defendants would likely argue that the evidence gathered against them in the initial weeks of the investigation was ``tainted,'' on grounds it may have come from immunized testimony.
The Supreme Court is expected to rule in early July.
Former national-security adviser Robert McFarlane, who pleaded guilty last week to four misdemeanor charges that he misled Congress in letters and testimony about arms sales to the contras, is expected to be a key witness, if there is a trial.
If similar deals are to be struck with others involved, the next few months are the time to strike them, sources say.
A source familiar with the case, but who asked not to be identified, says that the most likely candidate for plea bargaining is Secord. Unlike North, Poindexter, and Hakim, he was not granted limited immunity for testifying before the joint Senate-House committee last summer.
``Secord may not have the claim that others had - that their testimony `taints' the process,'' the source says. ``He may be more interested in a plea bargain.''
Mr. McFarlane's testimony could be helpful to prosecutor Walsh in seeking to prove a conspiracy case before a jury. Prosecutors could lead him through a narrative that would be more coherent to a jury than a case built piece by piece using different witnesses.
But the source, noting that ``it's hard to prove a conspiracy case without the testimony of one of the co-conspirators,'' says: ``I doubt Judge Walsh will get a lot from McFarlane about the conspiracy.''
The Iran-contra affair has political ripples as well. Vice- President George Bush, during his campaign for president, has denied knowledge of the illegal diversion of profits from the Iranian arms sale to the contras.
The indictments yesterday do not appear to implicate him. Another source familiar with the investigation doubts Mr. Bush will run into serious trouble in the future.
But a legal land mine - 21 mines, in fact - may be ticking away in the office of North's attorney, Brendan Sullivan. Those are North's 21 notebooks, which could open up entire new areas of investigation.
The four indicted in the Iran-contra scandal
Indicted yesterday by a federal grand jury on charges stemming from the Iran-contra scandal were:
John M. Poindexter. Navy Rear-Admiral Poindexter (ret.) was President Reagan's national-security adviser, and as such, the director of the National Security Council (NSC), from December 1985 to November 1986, when he resigned under fire. In testifying under limited immunity from prosecution before the House and Senate Iran-contra committees, he assumed responsibility for authorizing the diversion of proceeds from arms sales to Iran to help arm and supply the Nicaraguan contras. He also admitted in testimony that he withheld information from Congress and destroyed documents on diversion of funds to the contras because of the ``explosive nature'' of the plan.
Oliver L. North. Marine Lieutenant Colonel North was dismissed from the NSC in November 1986. He now serves as a project officer for plans with the Marine Corps. Testifying before the Iran-contra committees, he described his activity in arranging for secret sales of US weapons to Iran and in diverting profits from those sales to supplying aid to the contras in Nicaragua. Testifying under limited immunity, he also told of his role in using profits from arms sales to Iran to supply the contra forces. But he said his activities were known and approved by his superiors.
Richard V. Secord. Retired Air Force Major General Secord was North's chief link to the private sector in the sale of arms to Iran and the supplying of the contras. Testifying before the Iran-contra panel, Secord - who did not testify under immunity - denied he joined in what he called ``the enterprise'' for profit. He insisted that as a private individual he had a right to profit from such activity but renounced $1 million set aside for him by associate Albert Hakim (below) because he wanted to return to government service.
Albert Hakim. An Iranian who is a naturalized American, Mr. Hakim was a middleman in the sale of US arms to Iran. A business partner of Secord, he served as an interpreter-negotiator in meetings between the Americans and Iranians. He set up an elaborate financial network, including secret Swiss bank accounts, for handling the arms payments and the profits from the sales. He also admitted, in testifying before the congressional committees under grant of immunity, a role in the delivery of money and supplies to the contras.