While Billy Carter was prospering from his Libyan connection, big brother Jimmy Carter accrued some financial benefits of his own from a Saudi Arabian benefactor.

The story of how President Carter became indebted to a Saudi-controlled bank was first revealed in this space. I reported that in 1978 the bank cheerfully renegotiated a Carter business loan, which was tantamount to handing him $60,000 at a time when he was financially strapped.

The transaction has now been spelled out by Thomas Parry, an investigator for the Senate Judiciary Committee, in a confidential memo to Sen. Orrin G. Hatch (R-Utah). The memo reports that Ghaith Pharaon, "the son of the man who advises the Saudi Arabian royal family how to deal with the United States," acquired 98.4 percent of the stock in the National Bank of Georgia.

Perry calls the purchase "a dubious investment in a bank that had been losing money and doesn't pay dividends." But he points out a possible attraction, which may have led to this strange acquisition.

"The assumption in financial circles," suggests the Parry memo, "is that Pharaon acted for the Saudi royal family in purchasing the National Bank of Georgia. The bank's biggest borrower just happened to be Jimmy Carter. Thus the Pesident of the United States found himself deeply in hock to a Saudi Arabian financier with close ties to the Saudi government."

The Saudis gained access, the memo relates, "to the bank's confidential files, which contained embarrassing information about the president's financial affairs. The files revealed that the Carter peanut business wrote $3 million in overdrafts and unprocessed checks to repay peanut commodity loans during 1975-77 period.

"While Carter was scrounging money for his 1976 presidential campaign, the business borrowed $1.5 million from the bank to buy peanuts, without a single peanut in bonded storage to secure the loan, in violation of the loan agreement. By Sept. 1, 1977, the business was insolvent to the tune of $410,000."

At the time, these facts had been successfully covered up by a president who had promised to bare his finances to the electorate. Presumably, he was not anxious to have the hidden details publicized at the time they became available to the Saudis in 1978.

"Of course," recounts the Parry memo, "the Saudis remained discreetly silent. The friendly Pharaon not only kept quiet about Carter's financial irregularities, but renegotiated the loan to Carter's advantage.

"According to a memo in the bank files, dated May 1, 1978, the bank resulted in a savings of $60,000 for the Carter family in 1978. The president owned 62 percent of the business and, therefore, was the biggest beneficiary."

He was also liable for 100 percent of the debt, as the only partner who had the money to pay. But the memo describes a business reverse, meanwhile, which "resulted in a severe strain on the president's finances in 1977 - a strain that was releived by the opportune $60,000 renegotiation."

Not until two years later did Carter's trustees move his financial obligation from the Saudi-controlled bank to the Trust Company Bank of Georgia, which was free of Arab taint. But that's another story.

Footnote: The Senate investigator winds up his confidential memo with a pertinent observation. "The press and the public have been conditioned by Watergate," he writes, "to expect a 'smoking gun -- a taped conversation, a full confession by one of the conspirators or some other dramatic evidence. I am not at all confident that a 'smoking gun' exists . . . Perhaps the American people need to be reeducated about scandal. It should be considered scandal enough that the president would allow himself to come under financial obligation to a foreign power or that he would permit his brother to be used by a Muammar Qaddafi, who arms world terrorists and condones an attack upon the U.S. Embassy in Tripoli."