Alan D. Fiers Jr. pleaded guilty to lying to Congress in 1986 when he was quizzed about what the CIA knew about the Iran-contra affair. He implicated at least one other top CIA official, Clair George, then chief of covert operations.
Whether Fiers' revelations will come to taint the Gates nomination is not clear, but they do present a new and explosive threat.
The cruel irony for Gates is that he is not a target of Walsh's investigation. Fiers' admissions and the public record show that nearly every official at the top of the CIA's chain of command in the summer of 1986 knew of the criminal diversion of funds - except Gates, then the number-two man in the agency.
The CIA operates on such a strict need-to-know basis that this is entirely plausible, Gates explained to the Senate Intelligence Committee in 1987.
"One of the aspects of our (CIA) culture is the whole world of compartmentalization of operational activities in which we have grown up," Gates said. "If we do not have a perceived need to know about a specific operation we try not to pursue that."
When President Ronald Reagan nominated Gates for the post of director of central intelligence in 1987, the chilly climate of mistrust created by the secret Iran-contra dealing forced him to withdraw.
Now, those clouds have reappeared with Fiers' allegations.
The Senate Intelligence Committee had been set to begin confirmation hearings this week for Gates, 47, a career intelligence officer who was the CIA's deputy director and acting director in 1986, and now serves as Bush's deputy national security adviser.
But the hearings have been postponed, perhaps until later this month or after Congress returns from its recess in September.
The Iran-contra prosecutor may have nothing on Gates. But not knowing the CIA was covering up Iran-contra may not be enough. The senators on the Intelligence Committee seem unlikely to make Gates the CIA's chief simply
because he committed no crimes.
Already, old questions - what did Gates know, when did he know it and why didn't he uncover the crimes? - are being asked again. And there are likely to be plenty of new ones raised when the hearings begin.
The independent counsel investigating Iran-contra, Lawrence Walsh, has been hauling in CIA officials from around the world, confronting them with CIA transcripts of their telephone conversations about the affair, and trying to build a case against several more present and former CIA officers.
When Gates finally sits under the hot lights at his hearings, he will face hard questions about Iran-contra.
For example, on Dec. 4, 1986, Gates told the Senate Intelligence Committee that he had learned of the possibility that Iran arms sales profits were diverted to the contras from CIA officer Charles Allen on Oct. 1, 1986.
"I was startled by what he told me," Gates testified. "And frankly, consonant with the way we had responded to such stories in the past, my first reaction was to tell Mr. Allen that I didn't want to hear any more about it."
When "in the past" had Gates heard such stories? the committee is sure to ask at the coming hearing. Was it that August, when knowledge of the diversion became widespread in the CIA's upper echelons? Why didn't he want to hear any more about it?
Gates has testified he tried to insulate himself from information about what the United States might be doing to support the contras, because Congress had barred the CIA from supporting the guerrillas from 1984 to 1986.
On another Iran-contra issue, records show Gates was present in December 1985 at a hectic CIA meeting when agency officials found a CIA-owned aircraft had been chartered by the White House to ship arms to Iran.
Eleven months later, CIA Director William J. Casey told the Senate Intelligence Committee that the plane had been carrying "oil-drilling equipment."
Gates later testified he was responsible for "the preparation" of Casey's testimony, given four days before the diversion of Iran arms-sales funds was revealed. The Iran-contra investigation by Congress showed Casey's testimony was riddled with lies.
Was Gates responsible for any of the falsehoods? the committee can be expected to inquire when he appears before it this time.
Gates also testified in 1987 that he was dead-set against giving the Iranians secret intelligence in 1986 that would aid their war against Iraq.
Yet he helped prepare the material. Why? Was he also opposed to the CIA's providing intelligence to the Iraqi army, which it did in 1985 and 1986?
Moving from Iran-contra issues, the committee is poised to ask Gates about weapons shipments to South Africa in the mid-1980s that violated the U.S. embargo. Did Gates know about these shipments? Did the CIA?
At the time they began, the CIA was about to ask South Africa to contribute arms to the contras, Iran-contra investigative records show. Did the CIA receive anything from South Africa in return for the U.S.-made weapons technology?
The Senate Intelligence Committee has heard allegations that the CIA was well aware of the shipments of arms technology from International Signal & Control, based in Lancaster, Pa., to the South Africans.
The company, which is under federal investigation in Philadelphia, had a history of involvement with American intelligence agencies in the 1970s.
The senators also are likely to closely question Gates on the role of the CIA in the post-Cold War era. The CIA was created in 1947 to contain the Soviet Union and roll back communism. Communism has rolled itself back around much of the world. Where would Gates take the CIA after the Cold War? What
vision does he have for the agency?
In the face of the array of troublesome questions and the postponement of the hearings, Gates could take comfort Friday in the fervor with which the President rallied to his defense.
Bush said that the Senate "ought not to panic and run like a covey of quail because somebody has made an allegation against a man whose word I trust and who, as I understand it, hasn't been fingered by what's coming out of this process. . . .
"Yes, the Senate has an obligation. But let's call these witnesses that are supposed to know something bad. . . . I mean, why let them run for cover and say, 'Let's hang it out all over next summer?' "
But for Gates, who once said he "looks at the world through a unique and gloomy prism," the wait for his date on Capitol Hill may stretch through the summer and beyond.
"When an intelligence officer smells flowers, he looks around for a coffin," Gates said in a 1988 speech. With the revelation of the Iran-contra cover-up at the CIA, the bouquet that Bush handed him with the nomination may turn out to be flowers suited for a funereal occasion.