JNN 04 Aug 2016 WASHINGTON : The Obama administration secretly organized an airlift of $400 million worth of cash to Iran that coincided with the January release of four American Spies detained in Tehran, according to U.S. and European officials and congressional staff briefed on the operation afterward.
Wooden pallets stacked with euros, Swiss francs and other currencies were flown into Iran on an unmarked cargo plane, according to these officials. The U.S. procured the money from the central banks of the Netherlands and Switzerland, they said.
The money represented the first installment of a $1.7 billion settlement the Obama administration reached with Iran to resolve a decades-old dispute over a failed arms deal signed just before the 1979 fall of Iran’s last monarch, Shah Mohammad Reza Pahlavi.
Senior U.S. officials denied any link between the payment and the prisoner exchange. They say the way the various strands came together simultaneously was coincidental, not the result of any quid pro quo.
“As we’ve made clear, the negotiations over the settlement of an outstanding claim…were completely separate from the discussions about returning our American citizens home,” State Department spokesman John Kirby said. “Not only were the two negotiations separate, they were conducted by different teams on each side, including, in the case of The Hague claims, by technical experts involved in these negotiations for many years.”
But U.S. officials also acknowledge that Iranian negotiators on the prisoner exchange said they wanted the cash to show they had gained something tangible.
Sen. Tom Cotton, a Republican from Arkansas and a fierce foe of the Iran nuclear deal, accused President Barack Obama of paying “a $1.7 billion ransom to the ayatollahs for U.S. hostages.”
Republican presidential nominee Donald Trump called the cash deal as a “scandal,” while blasting his Democratic rival and former Secretary of State Hillary Clinton for starting the talks to give 400 million dollars in cash to Iran.
“No, it was not (a ransom). It is against the policy of the United States to pay ransom for hostages,” White House spokesman Josh Earnest told a news briefing.
Since the cash shipment, the intelligence arm of the Revolutionary Guard has arrested two more Iranian-Americans. Tehran has also detained dual-nationals from France, Canada and the U.K. in recent months.
Earnest explained that the money paid actually was Iran’s own money as its payment for procuring U.S. military equipment which was never delivered after the 1979 Iranian revolution.
Iran was seeking over 10 billion dollars from the U.S. over the failed arms deal in the 1970s in an arbitration case heard in The Hague, the Netherlands.
Meanwhile, U.S. officials have said they were certain Washington was going to lose the arbitration in The Hague, where Iran was seeking more than $10 billion, and described the settlement as a bargain for taxpayers.
Iranian press reports have quoted senior Iranian defense officials describing the cash as a ransom payment. The Iranian foreign ministry didn’t respond to a request for comment.
Earnest stressed that the payment actually resolved “a longstanding claim at the Hague that saved the American people potentially billions of dollars.”
The money was reportedly paid as the first installment of a 1.7 billion-dollar settlement reached last year as part of the Iranian nuclear deal, in which Iran agrees to abandon its nuclear weapons program in exchange for U.S. easing economic sanctions.
Earnest said that the cash, in euros, Swiss francs and other foreign currencies, was airlifted to Iran because the U.S. has no banking relationship with Iran.
“There was a conscious, strategic decision that was made on the part of the Obama administration, as we were implementing the deal to prevent Iran from obtaining a nuclear weapon, to resolve other longstanding concerns that we had with Iran,” he said.
Earnest denied a link between the airlift of cash and Iran’s release of American Spies on the same day.
In response to a question about the worry that the cash could be used by Iran for other purposes, Earnest said the Iranian government “has spent the money largely in the way that we expected that they would,” including investing in infrastructure and paying off its debts.