The Obama administration has admitted paying $1.7billion to Iran entirely in cash to settle a decades-old aborted arms deal.
Article by Associated Press and Chris Pleasance
The payments were made on January 22 and February 5, officials said, weeks after the release of four American prisoners detained in Tehran.
Officials previously admitted flying $400million in pallets of Euros, Swiss francs and other currency to Iran on January 17, the same day the prisoners were released.
While administrations officials have denied the money was paid in ransom, they have admitted the payment was contingent on the prisoners being freed.
Now sources have told the Associated Press that the remaining $1.3billion was paid in cash too.
Treasury Department spokeswoman Dawn Selak blamed the unusual payment on ‘the effectiveness of US sanctions’, which she says mean Iran is completely isolated from the international banking system.
But opponents say the untraceable cash could easily be funneled to terrorist organizations such as Hezbollah, which Iran is known to support.
The news emerged at a closed-door briefing held for officials from the State, Justice and Treasury departments on the payments, according to a Capitol Hill aide familiar with the session.
The $1.7billion represents money America owes Tehran following a 1970s arms deal with the shah’s government that fell apart following the revolution there.
America refused to deliver $400million in arms to the new Islamic government, but held on to the money as well.
The remaining $1.3billion is interest that Tehran has charged on the money over the past 30 years.
The money came from a little-known fund administered by the Treasury Department for settling litigation claims.
The so-called Judgment Fund is taxpayer money Congress has permanently approved in the event it’s needed, allowing the president to bypass direct congressional approval to make a settlement.
The U.S. previously paid out $278 million in Iranian claims using the fund in 1991.
On Tuesday, Republicans announced their support for legislation that would bar payments from the Judgment Fund to Iran until Tehran pays the nearly $55.6 billion that U.S. courts have judged that it owes to American victims of Iranian terrorism.
‘President Obama’s disastrous nuclear deal with Iran was sweetened with an illicit ransom payment and billions of dollars for the world’s foremost state sponsor of terrorism,’ said Marco Rubio, the bill’s primary sponsor.
Ed Royce, representative from California and the chairman of the House Foreign Affairs Committee, also introduced a bill that prohibits cash payments to Iran and demands transparency on future settlements.
‘All of this was done in secret, hidden from the American people and from Congress,’ Royce said of the cash payments to Iran.
Both the House and Senate are planning to hold hearings on the payments.