On an evening in late August, 1979, a few months before Iranian militants seized the American Embassy in Tehran, a tall, slim man, slightly gray at the temples, would walk out the front door of the Tehran Intercontinental Hotel, carrying a bright orange Lufthansa flight schedule in his left hand. West to the corner, then south on a street called Amir Abad.

If anyone checked, the passport and credit cards in his pocket would identify him as an American businessman based in Europe, William A. Foster, representing Carver Associates, a Philadelphia consulting firm. If authorities checked with Philadelphia, Don Meads, president of Carver Associates, was prepared to vouch for Foster.

In addition to his business affairs, Meads is active in foreign policy issues. Two years later, as president of the Philadelphia World Affairs Council, he would host President Reagan for a major foreign policy address.

Only Foster wasn't quite real. Meads knew him as Guy W. Rutherford, a CIA officer provided "deep cover" by Carver Associates. In fact, he wasn't Rutherford, either. His real name is Vernon A. Cassin, a now-retired CIA officer active in Middle East espionage for nearly two decades.

The audacious script was written at CIA headquarters in Langley, and, half a world away in Iran, the players followed their parts faithfully.

These precise details of a major spy enterprise, derived from CIA documents, provide a rare glimpse inside the operational realities of America's intelligence agency.

To American newspaper readers Abol Hassan Bani-Sadr was known only as another leader in the Iranian revolution, a small, bespectacled man with a drooping moustache who spouted anti-U.S. rhetoric in tune with his leader, Ayatollah Ruhollah Khomeini.

To the CIA, Bani-Sadr seemed a promising recruit.

At the next intersection, Foster-Rutherford-Cassin was picked up by a bright yellow sedan whose driver he knew by the code name Paquin. Paquin was Thomas Ahern, the CIA station chief in Tehran. As they drove through the city Cassin delivered the message that Langley wanted to hear: the initial contact had been made to cultivate and recruit Bani-Sadr, prominent leader of the 15-man Revolutionary Council, as an informer or agent.

Identified in cable traffic only as "SDLure-1," Bani-Sadr ostensibly would be "hired" as a paid consultant to Carver Associates, but the real purpose would be to secure an extremely well-placed source inside Khomeini's revolution. In time, Bani-Sadr was elected president of Iran.

Ahern cabled the results to CIA headquarters: "Although the meeting was brief, there were a sufficient number of indicators to suggest that there may be an opening to obtain subject's cooperation."

But none of the above will be news to U.S. adversaries.

For months, these facts have been available to Soviet intelligence and to anyone on the streets of Tehran willing to purchase a set of 13 volumes of U.S. secret documents.

Hundreds of highly sensitive documents were captured and reconstructed after the 1979 embassy takeover, then published selectively in paperback with commentaries in Persian for popular consumption.

Other documents reportedly have not been deciphered or have been withheld because they might embarrass Islamic clerics the militants support. Although those published do not support the more egregious conspiracy theories of the militants, they have been used in an intensive campaign to arouse further distrust of the United States. Many Iranians reportedly assume that documents destroyed would have provided even stronger evidence of subversion.

The published documents, most of which have been authenticated by U.S. sources, detail the U.S. estimates of the regime of the late shah, Mohammad Reza Pahlavi, the fundamentalist forces which toppled him and the struggle to preserve American influence in Iran.

When free-lance journalist William Worthy and two colleagues shipped their books from Tehran in December, 1981, Customs officers in Boston seized them, contending that the reprinted documents were stolen government property. But the journalists shipped in another set, overlooked by Customs, and made it available to The Washington Post.

Did the CIA succeed in its effort to recruit the future president of revolutionary Iran? No, says Bani-Sadr, now in exile in Paris, though he confirms that an offer was made.

The captured documents describe three meetings between Cassin and Bani-Sadr, but do not indicate that the CIA ever paid him anything. None of the American participants in the episode would respond to requests for interviews. The CIA likewise declined to comment.

But the agency's recruiting effort did have one unintended result: it helped drive Bani-Sadr from power.

After the embassy takeover it took the Iranian militants many months to sort out the captured papers and piece together hundreds of documents which had been shredded by embassy staffers in the final hours of the assault on Nov. 4, 1979.

Then the militant students had to translate the papers and figure out the coded meanings. By the spring of 1981, when Bani-Sadr was the moderate president of Iran battling radical clerics for popular support, the captured U.S. documents were used in the political struggle against him.

The militant clerics claimed that the evidence showed that Bani-Sadr had agreed to accept $1,000 a month from the United States, a charge that helped undermine his position. In June of last year, fearing for his life, Bani-Sadr disappeared into the underground, and some weeks later he was smuggled out of the country to his exile at Auvers-sur-Oise, France.

In an interview with Washington Post correspondent Edward Cody, Bani-Sadr confirmed that a man matching the Foster-Rutherford-Cassin description did try to recruit him in the late summer of 1979 to consult on business opportunities in Iran.

"I told him, 'We have a ministry of foreign commerce. Go over there and get the information you need,' " Bani-Sadr said in an interview. "As I remember it, I don't really remember, he offered me $5,000 a month."

Bani-Sadr says he pleaded that he was busy with his own work, but that Cassin responded that the consulting would take only half an hour from time to time.

"I told him $5,000 for a half hour, that's corruption," Bani-Sadr said in the interview. "I told him to go away."

Hamilton Jordan, chief of staff for President Carter, expressed skepticism that the CIA would have conducted such a recruitment effort and not have told him of such contacts, particularly at the time he was coordinating negotiations with the Iranian government headed by Bani-Sadr.

"I'm not aware of any effort by anygovernment agency, the CIA or otherwise, to recruit Bani-Sadr," Jordan said yesterday. "Though I wouldn't have necessarily known, I would think that I would have been informed . . . . It would have been a very risky thing to do."

The documents published in Tehran indicate that the CIA, desperate for inside information about the governing mechanisms and priorities of the Iranian revolution, attempted to build personal relationships with several members of the Iranian leadership.

Amir Abbas Entezam, the former deputy prime minister, was convicted of espionage based on embassy documents describing his contacts with U.S. officials. Although his contacts were approved by his superiors in the government, he was nearly sentenced to death and is serving a life sentence.

According to the Persian commentary accompanying the published cables, by January, 1980, the militants had found an initial batch of seven CIA documents describing Cassin's planned arrival in Tehran and an attempt by the CIA to recruit an unidentified Khomeini confidant.

A reference to Bani-Sadr's sister's telephone number in one cable (according to Bani-Sadr, the number is off by one digit) led them to believe that SDLure-1 was Bani-Sadr. However, Bani-Sadr was by then a leading candidate for president. Since the militants had no evidence that Cassin had ever arrived or that Bani-Sadr had been contacted, they did not release the material.

Sometime later, the militants claim in the commentary accompanying the reprinted documents, they learned by interrogating hostages that Cassin had visited with Bani-Sadr and offered him a $1,000 per month consulting fee for business advice to Carver Associates.

The Persian commentary claims that militant investigators learned that Bani-Sadr accepted the offer, although he never received any money, since the embassy takeover ended all contact with him.

But, with the Iranian presidential campaign still under way, the militants' commentary explains that they feared this was misinformation and decided not to rely on the hostage answers.

The Iranian militants did, however, begin the laborious process of reconstructing some of the CIA cables, which CIA station chief Ahern had shredded into 1/16th-inch-wide strips. They painstakingly matched the edges and rows of type for each strip in order to piece together the documents.

By January, 1980, Bani-Sadr had been elected president of Iran. Although the newly reconstructed cables did not mention him by name, the militants immediately recognized that the details about SDLure-1 matched Bani-Sadr: his positions in the revolution, his birth in Hamadan, and his role as publisher of the newspaper Islamic Revolution. Still, they did not move against him.

According to the captured cables, Bani-Sadr passed on trivial information on the mechanics and future of the Iranian revolution to the CIA officer, but may never have been fully aware of Cassin's connection with the U.S. government.

One cable cites the "assumption that L/1 not recruitable in classic sense," and discusses how to induce Bani-Sadr to provide information on a regular basis to "a trusted friend in the U.S. Embassy who is interested in economic affairs."

The effort to recruit Bani-Sadr really began earlier, when the Khomeini revolutionaries were still in exile and preparing to return to Iran. Cassin had first met with Bani-Sadr in January, 1979, in Paris, and the initial contact had been promising. There was no opportunity to follow up on it during the revolutionary regime's chaotic seizure of power.

The effort to recruit Bani-Sadr apparently was revived in June, 1979, when another CIA source, code-named SDRotter, mentioned that his cousin had recently had dinner with Bani-Sadr, who had been complaining bitterly about the activities of Ibrahim Yazdi, then foreign minister, and Sadegh Ghotbzadeh, then director of national radio and television. SDRotter urged the CIA to get in touch with Bani-Sadr, who he said was very ambitious and considered "himself as ministerial, if not presidential, caliber."

During their three Tehran meetings in late August and early September, 1979, Cassin's efforts to solicit Bani-Sadr's reflections on the revolution do not seem to have elicited much that was not available in the press at the time.

Bani-Sadr noted, according to Ahern's paraphrase of Cassin in one cable, that the Revolutionary Council "is not operating as efficiently as it could and should be."

At one point Cassin took what he called an "opportunity to provoke," asserting "that all important decisions are left to Khomeini and that without him things would fall apart quickly." To this Bani-Sadr pointed out that "Khomeini's strength and power are exaggerated. He made it clear that Khomeini is not capable of running the country alone and must rely on others."

Bani-Sadr told Cassin that Iran was not interested presently in purchasing more arms, but that it was "interested in obtaining spare parts for previously acquired U.S. equipment," according to one cable.

Other conversations appeared to focus on economic matters, such as plans to impose foreign exchange restrictions (minimal), to increase tariffs (only on luxury items) and to nationalize industries and businesses (only those created as result of abuses of shah's regime). Cassin's assessment of Bani-Sadr was summed up in a cable after their third meeting: "An individual with the access he enjoys should be able to furnish information of value in the period ahead." Bani-Sadr has "a promising political future," is "ambitious and politically astute," and "appears to be playing his game cautiously with an eye to the day when Khomeini passes from the scene."

Cassin noted that, while the Bani-Sadr he had met in Paris "was a revolutionary working on the outside, he now finds himself dealing with the fine points of running the administration of a country . . . . He, in reality, appears to be more of a bureaucrat than a revolutionary. Although always a soft-spoken intellectual, he nevertheless seems to be mellowing now that he is ensconsed sic in Tehran.

"He has developed a bit of a paunch, wears carefully fitted tailored suits and exhibits an expensive-appearing new gold wrist watch. No longer does he seem to have a ragtag group of students in his home as during the days in Paris . . . . The above is not to say that subj sic has lost his drive as a reformer; it is to note that with each passing day he seems to be more entrenched in the bureaucracy of the revolution that succeeded and is now facing the challenge of making the state function smoothly."

In the same cable Cassin offered his pro and con estimates of Bani-Sadr's potential as an informer:

"A. Positive: (1) Being a long-time plotter he could see his way clear in the future to plot against the regime if either he feels it is drifting away from its revolutionary objectives or that it would be in his own interest to do so.

"(2) Although he probably has no financial problems at the moment, he has to bear in mind that he could be exiled with little notice and could need financial support at that time. (3) Although he respects Khomeini he does not regard him as infallible. (4) As an intellectual, he prefers to make up his own mind rather than to follow another blindly.

"(5) He is aware that cliques are developing within the regime and is probably aware that he must be cautious in dealing with those around him. For example, he stated that all members of the Revolutionary Council are not equally competent but that he has to live and deal with them. This uncertainty will probably cause him to keep a few doors open.

"(6) He has political ambition. He probably started his newspaper in order to use it as a power base for future political objectives. (7) Although pressed for time at busy periods in Paris and Tehran, he has gone out of his way to meet us . . . .

"Negative. (1) Being firmly entrenched in the present regime, subject really does not need us at the moment. (2) Disclosure of a clandestine relationship with us would probably end subject's political career. It is certain that he will not overlook this point.

"(3) Experience over the years tends to emphasize the tendency of newspaper publishers to be self-seeking and often unreliable. His decision to start up a newspaper may indicate that L/1 is concerned only with his own political future and is not about to cooperate with us along the lines we envision.

"(4) Although subject's comments against U.S. firms meddling in the internal affairs of Iran may have been a signal that he wants nothing to do with the USG U.S. government , Cassin is inclined to think otherwise."

Cassin suggested that an agent be assigned to pick up where he was leaving off. This agent could approach Bani-Sadr in deep cover, in this case as an associate of Cassin from Carver Associates, or under official cover as an embassy employe, interested in economics, introduced by Cassin. Cassin recommended the deep-cover option to protect the local CIA station, the cable said.

By the spring of 1981 the Iranian militants were convinced that the documents supported their suspicions about Bani-Sadr's collaboration with the Americans, but still they were instructed, by Khomeini, to hold off. According to the Persian commentary, the militants took the material to Khomeini in May, 1981, but "the imam said, 'Let it be a secret for a time.' "

Later, the text says, when Bani-Sadr's problems with the clerics of the Majlis, or parliament, reached a crisis, Khomeini stopped insisting that the documents be kept secret.

The material was then turned them over to Mohammed Moussavi Khoeini, the deputy speaker of the Majlis, who attacked Bani-Sadr on the floor of the parliament. The militant students later released the documents and they were published, along with hundreds of others.

Though the documents do not confirm the accusation and Bani-Sadr denies it, his attackers claimed that he had agreed to accept the monthly payment from Cassin posing as a businessman.

When journalist Worthy was in Tehran last fall he interviewed Bani-Sadr's former secretary in prison, and reports that she told him that Bani-Sadr had received $1,000 from a U.S. firm. Her comments must be weighed against the fact that she is being held in an Iranian prison.

In any case, Bani-Sadr's political problems did not originate with that accusation. Under increasingly threatening criticism, he was forced to flee his presidential office and seek asylum in France.

From exile, Bani-Sadr steadfastly denies ever accepting any money. He says that since 1973, when a political officer from the U.S. Embassy in Tehran tried to set up a meeting, he has refused consistently to meet any American official.

According to Bani-Sadr, he did first meet Cassin in Paris, on the recommendation of a friend who urged him to receive "an American of high level" who has "an important message for Khomeini."

"I thought it was somebody with a message from President Carter," Bani-Sadr told the Post's Cody. "I didn't imagine it was someone from the CIA." Bani-Sadr says he complained to his friend that Cassin was just an American businessman rather clumsily attempting to establish an inside track in Iran.

Cassin also showed up at Bani-Sadr's sister's house where he was staying in Tehran late that summer, Bani-Sadr says.

"He looked stupid," Bani-Sadr said. "Maybe he was very intelligent, but he seemed stupid to me."

Special researchers Jan Austin, Michael Meyer and Malcolm Byrne assisted in the preparation of this report.