I found this Google-ating
Quote:
"Interestingly, Iver Johnson Arms reportedly built lower receivers and parts for M16's to be supplied to the Contras as part of a CIA plan after it's move to Arkansas in the late 1970's.
Under federal law, arms companies must create a paper trail for tracking and control of weapons, especially for components that go into fully automatic weapons. All international sales require an End-User Certificate, which traces the weapon from origin to destination. The Boland Amendments, which banned sales to the Contras, effectively forced the CIA to find a source of weapons without such certifications.
The secrecy required to produce the nontracable parts posed an immediate problem for Iver Johnson. Iver Johnson was working on a classified contract with the United States Navy to product a .50 caliber sniper rifle. This required government inspectors' scrutiny of the company's operations in it's location in Jacksonville, Arkansas, where it was then producing copies of the M1 carbine.
To circumvent this scrutiny, a decision had been made to cast critical, and untraceable, parts at a location other than the Iver Johnson plant in Jacksonville, Arkansas. A group lead by Barry Seal, who supposedly worked for Oliver North, set up shop that would contain the casting operation in the isolated town of Mena, Arkansas, nestled in the Ouachita Mountains. Because Iver Johnson was an established firm, it provided instant cover for the clandestine work that was slated to be done in Mena. On paper, Philip Lynn Lloyd, a wealthy Arkansas businessman with close ties to the Arkansas bond industry, was listed as a principal in the company and the man responsible for the relocation from New Jersey to Arkansas. Lloyd was later convicted in federal court in Little Rock in 1990 for bankruptcy fraud and conspiracy when his financial empire collapsed.
The plan was to build lower receivers for full auto M16's that had no serial number that could not be traced back to anyone in the United States. Obviously, the CIA did not want serial numbers on weapons going to the Contras during a period when Congress had banned the sales.
It appears the deal did not work out when security became an issue. Insiders and cronies from the administration of then Governor Bill Clinton learned through a security leak what Iver Johnson was really doing in Arkansas and demanded a piece of the action themselves. POM, a parking meter company in Russellville, Arkansas, was owned by a Clinton crony and leveraged it's way into the underground arms-manufacturing loop to make certain M16 parts alongside parking meters.
I'ver Johnson's participation in the Iran/Contra issue is a very compicated and interesting story that ended up ruining the company in bankruptcy in 1993."
(Information from the book Compromised by Terry Reed and John Cummings)