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The selling of weapons to Iran during the Iran-Contra affair was controversial because it violated U.S. arms embargo policies and contradicted the government's official stance of not negotiating with terrorists, as Iran was perceived as a state sponsor of terrorism. Additionally, the profits from these sales were secretly diverted to fund Contra rebels in Nicaragua, circumventing Congress's prohibition on such aid. This operation raised significant ethical and legal concerns, leading to widespread public outcry and investigations into the Reagan administration's actions.

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