Washington DC, December 1984

BY NOW the Contras were virtually defeated by the Sandinistas, both militarily and politically. But the election results and reality on the ground meant nothing to the Sandinistas’ opponents in the White House, Langley and the Pentagon, who were determined to stop the spread of what they saw as communism in Central America – even if these communists were now democratically elected in a vote which British politicians regarded as free and fair.

With a congressional ban on US funds for the Contras, the right-wing hawks had to formulate a more elaborate plan. The Contras would be supported through unofficial channels. Plausible deniability was key. A web of shell companies would be needed to administer the scheme without anyone being able to prove that the US government was involved. The proceeds of secret US arms sales to Iran, whose ayatollahs were America’s sworn enemies, would be diverted to bankroll the shell companies.