The revelation raises questions about whether Iran may have used a small cabal of officials in the Pentagon and in Vice President Dick Cheney's office to feed bogus intelligence on Iraq and Iran to senior policymakers in the Bush administration who were eager to oust the Iraqi dictator.

Iran, which was a mortal enemy of Iraqi dictator Saddam Hussein and fought a bloody eight-year war with Iraq during his reign, has been the primary beneficiary of U.S. policy in Iraq, where Iranian-backed groups now run much of the government and the security forces.

The aborted counterintelligence investigation probed some Pentagon officials' contacts with Iranian exile Manucher Ghorbanifar, whom the CIA had labeled a "fabricator" in 1984. Those contacts were brokered by an American civilian, Michael Ledeen, a former Pentagon and National Security Council consultant and a leading advocate of invading Iraq and overthrowing Iran's Islamic regime.

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