Decoy in a Deadly Game : TERRY WAITE AND OLLIE NORTH: The Untold Story of the Kidnapping--and the Release, <i> By Gavin Hewitt (Little, Brown: $19.95; 230 pp., illustrated)</i>

In his best-selling book, “Under Fire,� Oliver North of Iran-Contra fame makes one brief reference to Terry Waite, the special envoy of the Church of England. Noting Waite’s presence among those on hand to welcome released hostage David Jacobsen in Beirut on Nov. 2, 1986, North adds, “Terry had risked his life to gain the release of all the hostages, but not long afterward, in January, 1987, he too would become a hostage.�

Risked his life, true. But contrary to the charade created for the world by impresario North, Waite had nothing to do with obtaining the release of any hostage in Lebanon. His assigned role, apparently largely unwitting, was to be the decoy, diverting attention from the real negotiations. These involved arms sales to Iran that purchased the freedom of three Americans but led to the captivity of six others, once the hostage-takers realized how lucrative their operation could be.

All this we learn from a remarkable piece of investigative reporting by a British journalist who is apparently intent on confronting Americans with the cynical manipulation that brought down a British folk hero. We might have thought that after five years of official and unofficial American probing we knew all the terrible truths about Iran-Contra. Having promised some of his sources to wait for the Anglican envoy’s release from captivity, however, Gavin Hewitt of the BBC’s Panorama news series is only now able to reveal one of the worst episodes. Waite won his freedom last month, after spending 1,763 days as a hostage of those from whom he sought the release of other hostages.

Ably setting this story of an idealistic church envoy and his trickster against the vivid backdrop of the long hostage crisis, Hewitt does not hesitate to name some of his sources--American and British officials, clerics and intermediaries. Other information was obviously gleaned from a careful examination of the hundreds of thousands of pages of documents released in official investigations, including North’s notes and diaries. Hewitt’s technique, similar to that successfully employed by journalist Bob Woodward, is to synthesize this into a narrative so compelling as to suggest that the author saw it all. If you ask whether I take this account at face value, lacking as it does many specific attributions, the answer is that it is hard not to, given the wealth of color and corroborative detail.

The British journalist’s quest commenced in the summer of 1987 when, in the course of researching a documentary on the mystery surrounding the disappearance of Terry Waite, an American “Senior Administration Official� confided that “our treatment of Waite was shameful� and that “Ollie North� was the one to ask about it. North, who was then achieving fame and future fortune as a witness in the televised Congressional hearings, was not available. But four years of patient inquiry paid off.

You feel like a spectator at a drama from the moment you read of Waite’s first meeting with a leather-jacketed North on May 18, 1985, in the Manhattan penthouse apartment of the Presiding Episcopal Bishop, where he also met the wife of hostage Benjamin Weir. Everyone present is named except “a State Department official� who was probably a source for a comprehensive account of the conversation. Waite found North “sincere� and “very American.�

From this meeting between two extroverts, sharing an Episcopalian background and a sense of adventure and mission, there developed a partnership in which Waite agreed to work for the release of American hostages in Lebanon, as he had previously done for British hostages in Iran and Libya. Waite did succeed in making contact with the captors of Americans, and even persuaded them to provide him with a current photograph of a few of the captives, but he had no success in negotiating the release of any of them. North encouraged him (in direct violation of Reagan policy) to talk to the hostage-holders about a possible exchange for 17 Lebanese terrorists in prison in Kuwait, but it soon became clear that Kuwait would not be moved.

When the Rev. Benjamin Weir was freed in September, 1985, in return for a shipment of missiles from Israel to Iran, Terry Waite flew to New York to hold a press conference with him; the British press called Waite “the secret negotiator behind the release.� North was said to have bragged to his colleagues about how well Waite was serving as a “cover.� So with the subsequent releases of Father Laurence Jenco and David Jacobsen: In order to suggest a totally nonexistent involvement in their release, Waite was asked to be on hand for picture-taking and interviews.

North also persuaded the Anglican envoy to conceal a tracking device in his belt buckle. It was, said North, for Waite’s own protection when he went into West Beirut to meet with the holders of hostages, but Hewitt writes that the miniature transmitter was also seen as a way to locate hostages in case a rescue mission was decided upon. (When Waite was taken hostage in January, 1987, Tehran radio noted the electronic device and denounced him as a spy.)

Each time a hostage release was expected--as in May, 1986, when North and Robert MacFarlane flew to Tehran on their ill-fated mission--Waite was asked to be on hand in Beirut, Jordan or Damascus to receive the liberated men. Why a release succeeded or failed Waite never knew. On one occasion, North referred to Waite as “our only access to events in Lebanon.� A National Security Council official said that North “ran Terry Waite like an agent.�

One would have thought that the exposure of the arms deal and the firing of North in November, 1986, would free Waite from the damaging connection with his American friend. When Waite returned to Beirut two months later, however--determined to recover his dignity and role as an independent intermediary--he found that his position had been thoroughly compromised. The holders of hostages knew of his frequent meetings with North, and that he had been serving as a front man for arms deals between the Reagan Administration and Iran.

Hewitt managed to interview North three weeks before Waite’s release. The Iran-Contra point man conceded that he had used the Anglican envoy in some ways that might have been “less than desirable.� Asked if he felt any guilt about Waite, North said, “Guilt? I have a problem with the word.�

Waite, himself in retreat since his liberation, remains to be heard from. Meanwhile, we have this outstanding piece of British investigative journalism to help us become outraged all over again.