In the mid-1980s, President Ronald Reagan saw the Nicaraguan contras, who he had referred to as the equivalent to America's Founding Fathers, struggling to repel the Communist Sandinistas for control of the country.
At the same time, the Reagan administration had a problem in another part of the world. Iran, a U.S. enemy following the Iranian hostage crisis, needed arms to fight a war with Iraq and made a request to the United States to supply them, despite an arms embargo.
Killing two birds with one stone, the U.S. secretly supplied arms to Iran via Israel in exchange for American hostages and cash. That money was then funneled to the contras in Nicaragua.
In 1986, a Lebanese newspaper exposed the scheme, forcing the president to appear on national television to deny such an arrangement ever took place. The Tower Commission, appointed by Reagan, investigated, as did Congress. Although Reagan and Vice President George H.W. Bush were never directly linked to the Iran-Contra program, 14 administration officials were indicted, resulting in 11 convictions, all of which were either overturned on appeal or pardoned.
Negotiating With Terrorists: What's the Big Deal?