364. Memorandum From the President’s Assistant for National Security Affairs (Scowcroft) to President Ford 1

SUBJECT

  • Suspension of Covert Action Program in Italy

Leaks about our planned covert action program in Italy as well as changing political circumstances there, have led us to reexamine the program you approved last December. We had recommended a three-stage $4.8 million program [less than 1 line not declassified]. On 4 December, you signed a Presidential Finding pursuant to Section 662 of the Foreign Assistance Act that this operation was important to our national security. You instructed the Director of Central Intelligence to brief the required six committees of the Congress, and Bill Colby did this during 8–16 December.

In late December, leaks about this program began to appear including leaks from the final draft report of the House Select Committee on Intelligence dealing with past covert action in Italy. [less than 1 line not declassified] It was alleged that CIA had funneled at least $6 million in secret payments to Italian politicians since 8 December. Colby denied this and declared that not one cent had been spent.

In addition to the publicity and the aura of suspicion generated in Italy, there has been a dramatic change in the Italian political scene. The Socialists withdrew from the governing coalition and Premier Moro was forced to resign. An effort to form a new government is under way. National elections by June are a possibility. These developments alter the proposed covert action timetable, and adverse publicity restricts our ability to mount successful operations.

The 40 Committee reviewed this situation at a meeting on 3 February and recommends that implementation of the covert action program should be deferred. A working group would continue to monitor developments closely to recommend appropriate resumption of activity when or if it comes to appear feasible and desirable in support of our [Typeset Page 1117] continuing overt activity. Your approval would be sought prior to resumption of any covert political action under this program.

RECOMMENDATION

That you authorize the suspension of the Italian program.

  1. Summary: Scowcroft sought Ford’s approval of the suspension of the covert action program in Italy.

    Source: National Security Council Files, Ford Intelligence Files, Italy—GRF 1974–1977. Secret; Sensitive; Eyes Only. Outside System. Sent for information. Ford initialed his approval of Scowcroft’s recommendation on February 9. The 40 Committee discussed the suspension of the Italian covert action program on February 3. (Memorandum for the record, February 3; ibid., 40 Committee Meetings, Minutes/Approvals, 1975 GRF)